At first glance, the property management industry may appear to be in a favorable moment. According to one survey, nearly three-quarters of United States renters are satisfied with their property management companies or landlords. The rental market is also heating up: In Q3 2022, there were nearly 44 million rental households in the U.S., marking an increase of 400,000 units since 2021. A deeper look, however, reveals that all is not as well as it seems.
Having already declined by 4% in 2022, the industry’s market size is expected to shrink another 0.4% in 2023. This decline could be made even worse as rising rent prices threaten renters’ and companies’ ability to keep up. A 2022 survey found that 62% of renters are worried about being unable to pay for housing this year, and even some major companies are closing offices to save money. The industry is also becoming more competitive. In the U.S., there are now an estimated 296,254 property management companies, an increase of 2.1% since 2018. Considering this fierce competition and economic challenges, property managers must improve their services.
The “Money Mobility Tracker®” explores how property managers can step up their games by improving their payment processes.
Around the Money Mobility Space
Small businesses are feeling the rent-related strain. According to a poll, 41% of U.S. small businesses were unable or struggling to make rent in November, a new record for 2022. The survey findings indicate what is fueling these difficulties: Of the small businesses surveyed, 52% reported higher rents, while 41% reported that monthly revenue is half or less than before the pandemic.
Even major businesses are struggling. Major companies, including Microsoft, Meta, Salesforce and Alphabet, are reportedly looking to move out of leased offices in London and Dublin as part of cost-cutting measures. Meta also explored terminating leases for California, Texas and New York offices.
For more on these and other stories, visit the Tracker’s News and Trends section.
An Insider on Why Online Payments Are Critical for Property Managers
As is the case across the business world, there is a growing interest in and need for digital payments technology among property managers. Operating a property management business requires the proper facilitation of and visibility into payments, and online payments platforms can enhance these capabilities.
To get the insider point of view, we spoke with Adam Feinstein, vice president at AppFolio, to learn more about how a fully-digital payments process can drive better outcomes for employees and tenants alike.
Money Mobility Boosts Owner and Tenant Satisfaction
From collecting rent to paying employees, maintenance workers and business partners, property managers are always handling payments. Therefore, online platforms that facilitate fast, frictionless payments can have tremendous benefits for property managers, resulting in a surge in their interest.
These platforms can also help improve tenant satisfaction. According to a report, 28% of tenants said it has become more important since the pandemic began for property managers to offer digital tools to manage rentals. Mobile payments are also popular, with a recent survey finding that mobile overtook online portals as consumers’ most preferred payment channel. Online payment platforms can also improve the landlord’s back-office experience. One property manager estimated that adopting an online payments system saved his team 15 to 20 work hours per week.
To learn more about money mobility’s benefits in the property management space, read the Tracker’s PYMNTS Intelligence.
About the Tracker
The “Money Mobility Tracker®,” a collaboration with Ingo Money, examines why property managers are under pressure from macroeconomic conditions and how adopting online payments platforms can help them gain an edge.