The property management industry is thriving globally, with companies of all sizes and types. However, to succeed in this competitive field, it’s essential to track and manage key business metrics effectively. One way to do this is by monitoring four critical real estate leasing metric KPIs. In this blog, we discuss these KPIs and how tracking them can help you enhance your efficiency, make informed decisions, and boost your profits.
Lead Conversion Rate
This KPI measures the number of prospective tenants who become actual tenants due to your marketing efforts. If your property management company is underperforming in this metric, it’s time to reassess your marketing strategy. The industry average is 3-5%, and anything below this is a cause for concern.
Tenant Retention Rate
This KPI indicates how long tenants stay in your property. A lower retention rate could mean your property is being mismanaged, leading to overdue repairs, poor amenities, or high rents. Renewing an existing lease is more cost-effective than finding a new tenant, so focus on improving your retention rate.
The longer a unit stays vacant, the more money you lose. Monitoring how long it takes to lease a unit is critical to optimize your leasing process. You want to keep your days-to-lease comparable to the market average, typically two weeks in hot markets, and analyze them against other KPIs such as market rents.
Tenant Acquisition Cost
Acquiring new tenants can be expensive, including advertising and tenant screening costs. Calculating tenant acquisition costs will help you evaluate your marketing strategy’s cost-effectiveness and identify areas where you can reduce expenses.
Benefits of managing these metrics
Benchmarking your performance against your company’s previous years and your competitors will help you adjust your marketing strategy to improve your business’s overall value. By collecting data and leveraging it to make data-driven decisions, you can streamline your operations and enhance your existing and prospective tenant relationships.
Data collection is critical to the success of your property management business, and a CRM tool can help you collect and leverage data more effectively. If you’re looking to modernize and optimize your approach to property management, consider one of the leading real-estate-specific CRMs, such as Convert by RealSage. With the right tools and data, you can optimize your leasing process and enhance your business’s overall success.