Being a property manager, there’s nothing more exciting than the prospect of expanding your business to another location. But, is it that simple?

Indeed, the monetary benefits associated with this expansion are great. At the same time, one must create an actionable plan to go about this process, or everything might fall apart.

So if you are a property management software company looking to add a few more locations under your precious area coverage, keep reading. Here’s how you can do it in a step-by-step manner:

1.Decide How Would You Spend: Create a New Company or Buy an Existing One?

The first step is to decide how you are going to spend your business. It could be buying an existing company operating in an area where you want to create your presence, or starting a company there from scratch.

If you go with the first option, you’d have to do ample research to find a company up for sale or for a potential partnership. The company must be trustworthy, not under any debt, and have a clear background.

And if you choose to create a company your best option would be to create a franchise and sell it – let others manage it while you get your monthly share without any delay.

Both options have their pros and cons. Consider them before you decide to implement one.

2.Research The Areas You Seek To Expand Into

This step is somehow interconnected with the first step. Once you have decided to expand, you must decide what are your target areas – or in which areas you see the potential for exponential growth in the coming years.

You must have a few locations in mind, look at the opportunities there, and market trends. Do you see the property prices going up there, or maybe it’s a lavish area where more house owners seek property managers to take care of their homes?

Since we are in 2022, in the middle of a pandemic, observe the pre-pandemic and current trends. If there’s a rise in the demand of property managers or prices of the property, make sure it’s not temporary due to the pandemic.

Also, consider the management requirements as they differ from location to location – rental, marketing, and maintenance processes vary greatly. In a nutshell, do a deep dive into an area before considering expanding into it.

3.Set Up a Budget

When it comes to the property price, the difference can be stark between two lands of the same size but a slightly different location. This is why budget impacts your strategy in the property management business.

And by all means, expanding requires a hefty investment. The new income you are expecting will come at a cost. If you are starting a project or buying land, assess all the impending expenses: Infrastructure, new staff, marketing, etc.

Also, perform a calculator regarding the estimated investment and operating margins. How much growth can you expect in the coming years? This way, you will not be in the dark regarding the ROI and have your expectations well set for the best possible outcome.

Include a property management software in your estimated budget as it will help you to automate tasks.

4.Familiarize Yourself with Local & State Regulations

It’s extremely important to familiarize yourself with the local and state regulations before you step into a known area. As mentioned above, the state regulations might vary, and this might require you to alter your operations.

If possible, get a consultation from a real estate expert. Or find out what are the legal requirements there to start a real estate company. Neglecting this aspect can lead you to legal troubles, leading to a fiasco.

For example, in some countries, you can place an ad and ask the tenant to come in as soon as you agree on a certain rent. But some laws require you to screen the tenant before you let them live in your house/apartment.

Likewise, there are zoning laws, occupancy laws, and maintenance and safety-related laws that need to be complied with at all costs.

So developing an understanding of the local real estate market is a must.

5.Set Up a Limit

How much area you can cover depends on your investment. Of course, you will play it sensibly. You would prefer to put 80% of your money in a safe and reliable location – even if the expected ROI is not much.

Plus, the more you expand the tricky it gets to manage properties. So always have a predefined stopping point. It could be a virtual boundary you have set, the number of rental profits you are going to acquire, or how far apart you can afford your properties to be.

Once done with it, make sure you have a solid plan. Fill gaps in staff, marketing, and infrastructure to get all the bases covered.

6.Go to Networking Events

You are new to an area, nobody knows you. How would you find clients or prospects to kick-start your business in the beginning? So you need to join a networking group and attend all sorts of marketing events to make your presence in the area count.

In these events, you will learn valuable information and create connections that will benefit you in the longer run.