Mrs. Woo was my first introduction to property managers. Back when I was fresh out of college, she’d knock on the door once a month for the rent check. When there was a leaky faucet or a tree that needed trimming, she’d call someone to fix it.
For decades, I assumed that was what all property managers were like—somewhere between Mrs. Woo and Mr. Furley, the crotchety landlord on the ‘70s sitcom Three’s Company. But it turns out that my dated ideas had little to do with property management, especially today: It’s a profession that’s both highly in demand and evolving fast.
Demand for property managers is set to spike by 10% in the years ahead as renting becomes a way of life for bigger chunks of the population. And as the renting population diversifies, so has the skill set required of property managers. Knocking on doors has given way to navigating software platforms. In place of wrangling renters for late checks, managers are finding themselves offering customized customer service to residents and owners alike.
There’s just one problem. As older property managers contemplate retirement, a critical talent gap has opened up, with a smaller percentage of young people entering the profession. Our recent survey of more than 1,700 property managers found that while two years ago 23% of the property manager workforce was new to the job, last year only 11% were new faces. Ironically, what was once thought of as a behind-the-scenes role is now tailor-made for digital natives with an entrepreneurial, service-minded spirit. That’s right: Property management is now the hot job no one has heard of.
Prime Time for Property Managers
Multiple factors underlie the surge in demand for property managers and the fast-paced evolution of the profession. For starters, renting has become increasingly common across demographics—a majority of the 22 million households expected to form by 2030 will be renters. And it’s not just millennials priced out of the housing market—people aged 55 or older make up the largest growth in the rental population, while the number of senior renters is expected to grow to 12.2 million in the next 12 years.
Meanwhile, institutional investors have jumped into the rental industry. Big private-equity firms and real-estate speculators spent more than $36 billion between 2011 and 2017 on homes for rent. With that has come a need for more qualified managers.
At the same time, in the era of apps, Yelp reviews, and instant online gratification, consumer expectations have changed dramatically. Taking care of the property itself is just the bare minimum, as residents and owners have grown to expect an expanding array of services. Indeed, today’s property manager has a job that would in some instances be unrecognizable to predecessors from generations past.
Not Your Grandfather’s Property Management
In a short time, property managers have dramatically expanded their purview and expertise. New research shows they’re increasingly relying on technology, turning to digital platforms for everything from leasing and rent collection to community building and maintenance task management—80% of property managers now rely on property management software, 70% on online rental listings, and 80% on digital communications.
Property managers are also being called on to play a role that is strategic as much as tactical, juggling the needs of demanding residents and involved owners insisting on rising returns. The same survey revealed that property managers are increasingly being sought as trusted advisors on matters regulatory, financial, and more, not just as the feet on the street.
With these shifts have come new ways to make money. Services like property brokering and investment advice have grown in popularity 14% over the past three years, as savvy property managers find ways to diversify their revenue streams and boost efficiency using technology. While the role has always been diverse and results-oriented, the nature of responsibilities and type of results expected has fundamentally changed.
Fresh Faces in an Evolving Industry
All this has culminated in a sea change in the field and an increasing appreciation that property management is a hospitality-based, tech-driven career, ripe with opportunity for entrepreneurial-minded people. For many next-gen “PMs,” the profession weds business hustle with a level of flexibility and freedom rarely found in corporate roles, key criteria among a millennial workforce raised in the age of startups and the gig economy.
Millennial-run Zen Real Estate in Rhode Island, for example, is totally cloud-based, with team members collaborating on rental listings, client care, and maintenance tasks remotely. Other independent entrepreneurs have made project management their side hustle with the help of technology.
Mission and purpose—two other ideals associated with millennials and Gen Z—are also part of the appeal. For all of the changes, property management remains at heart a hands-on service role, involving working with people and creating community in real life, not on some virtual platform. That being said, technology has minimized many of the rote and labor-intensive facets of the profession (i.e., everything from background checks to rent collection), freeing project managers to double down on higher-value and more rewarding services.
But for all the potential and latent demand, there remains a lingering knowledge gap. Old perceptions persist and awareness of the field and its potential remains low. Certification programs exist (like those offered by the National Association of Residential Property Managers), as do a handful of degree programs at U.S. universities, but these are few and far between.
Property management has a long, venerable history of attracting bootstrappers and DIY aficionados. While the job has changed, that part hasn’t. In the end, the key to attracting and training the next generation of project managers—and servicing the booming rental stock—may come down to a long overdue image makeover. Today’s property manager has a whole lot more in common with resourceful entrepreneurs like Elon Musk and Sara Blakely than Mr. Furley.