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Property Manager | Key Factors Investors Need to Track For Their Rental Properties

Property Manager | Key Factors Investors Need to Track Their Rental Properties

A rental property owner needs to understand how their single-family rental homes are performing if they want to know what their profits are. There are a few key performance indicators that a property owner or property manager needs to track to get the full picture of how well their rental is doing. It comes down to more than just rental income vs. expenses. Make sure your property management company is looking at these financial and operational indicators:

Financial Key Performance Indicators

The financial key performance indicators will tell a property manager how the rental property is doing on a financial level. The rent falls into this category, along with expenses, but you need a much more in-depth financial ledger if you plan to file business taxes, apply for a loan, grant, or need to make other significant financial decisions.

These are the financial key performance indicators that a property manager needs to track:

  • Gross Rent
  • Average rent increase
  • Average rent per square foot
  • Profit margin
  • Vacancy rate
  • The average cost to turn a home
  • The average cost of monthly repairs
  • Cash on cash return
  • Cashflow
  • Return on investment
  • Depreciation
  • Vacancy losses
  • Delinquency losses
  • Eviction losses
  • Property tax
  • Capital improvements
  • Insurance
  • Utilities
  • Marketing
  • Background and credit checks
  • Property management software subscriptions
  • Rental website subscriptions
  • Legal fees
  • Accounting fees
  • Manager fees
  • Mortgage interest
  • Vendor payments

Operational Key Performance Indicators

Knowing the operational key performance indicators will allow an owner to see how effective their property manager is and how the property manager is affecting the overall return on investment.

A property manager should be tracking these operational key performance indicators:

  • % successful renewals
  • Average rent increase per year per lease
  • Rent increase for new tenants vs. the previous tenant
  • Applications that come in
  • Percent of applications denied and approved
  • Average day to process an application
  • Percent of lease breaks
  • Percent of evictions
  • Delinquency rates
  • Average days rent late
  • Percent of leases terminated each year
  • Average days vacant units are on the market
  • Number of days a home takes to turn
  • Days a unit is vacant
  • Number of work orders entered and days to complete
  • Tenancy Duration

A property management company who can track these key performance metrics will better understand the property and increase profits for owners quickly.

If you need a property manager that effectively manages your property across all metrics, give Scott Properties a call at 843-202-4274.