Property Manager | Key Factors Investors Need to Track For Their Rental Properties
January 4, 2020
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
Auben Realty a call at .