More and more, property management professionals and property management companies are looking for services that they can add to their offerings in order to capture more business without adding too much overhead. These ancillary services can increase net operating income and help you elevate your business.
Let’s take a look at what kinds of ancillary services are available to property managers, the factors you should be considering as you look to add them to your offering, and how you can add them without stretching your team too far.
There are plenty of examples of ancillary services that property managers can offer, some more popular than others. When you step back and look at the expertise you already have, it becomes pretty clear: you’re sitting on a goldmine of services owners need.
Here are some of my favorite (and profitable) ancillary service opportunities I see PM companies offering:
If your company is already doing the hard part (running properties well), there’s no reason not to package that expertise into additional services that deepen relationships, drive retention, and unlock new revenue streams.
The key to adding ancillary services is making sure that they:
Even though these added services can be great for your bottom line, you can never prioritize them over the core of your management business. Your PMA is the scope of work you’re promising you’ll do for a client and should always take precedent.
That said, most property management businesses have seasons where operations are running smoothly and there is additional capacity. When that happens, you may look for ways to grow without simply stacking more doors into the portfolio. Strategic ancillary services can help you increase revenue, create deeper client relationships, and build a more resilient business model during those windows of opportunity.
The first step is making sure that whatever additional services you’re considering adding make financial sense for your company. In particular, if you’re going to need to add additional headcount to be successful, there’s some math to be done. How much money do you need to charge for an ancillary service in order to justify bringing on an additional team member to manage it? Do you have the lead flow to make this a viable part of your offering? How long will it take to recoup any investment you’re making?
Ancillary services can help you go beyond just adding more and more doors as your only lever of growth, but you need to make sure the numbers add up before you dive in.
The next factor to consider is what kind of capacity your team currently has. There’s only so much that an individual team member can do. You don’t want to stretch people so thin that they become unhappy in their roles, or you’ll quickly find yourself losing staff.
Consider the skills that you currently have in-house—oftentimes your existing staff are capable of doing these things, but you have to look at whether they have time. Ask yourself, is there anyone who’s currently not at maximum capacity? They might be able to take on additional services.
Even more importantly, is there anyone whose capacity is highly seasonal?
There are many property management roles that are highly seasonal, and leasing agents are the perfect example. They’re super busy during the busiest times of year and not busy during the slower seasons.
Seasonality leaves you with a couple of different options to optimize your business. First off, you can adjust processes to try to balance their work. If you know that, from May to September, your leasing agents will be swamped, how do you plan ahead for October to April? Maybe you can break the inspection cycle apart from the leasing cycle so that they’re performing inspections in the slow season, giving them a more balanced schedule year-round.
The other option is to take advantage of the slower months to give them ancillary work. If they have capacity to focus on real estate sales or coaching residents on homebuying skills, you can leverage these added services without needing to increase payroll.
Remember, like everything in property management, there will be variation based on your local market. I already mentioned that different markets have differing levels of demand for things like renter brokers, but there’s also the question of regulation.
Regulations and licensing play a big role in how many of these ancillary services you can provide, and you need to make sure you’re protected legally. Some roles, like real estate sales, require licensing in almost all jurisdictions. In some areas, insurance shopping may or may not be considered insurance brokering, which also requires a license. Other functions might not require licensing, but do have certification requirements or training requirements.
The good news is that these requirements can be a strategic advantage rather than a barrier. Certifications and licenses create professional development opportunities for your team, helping them grow while strengthening your company’s competency. They also become a differentiator in a competitive market. When you are the company that understands property management and insurance better than anyone else, your value becomes far more obvious to investors.
Knowing your market keeps you compliant, profitable, and positioned as the expert worth partnering with.
Growth in property management rarely comes from giant leaps. It comes from small, intentional moves that build capability and confidence over time. Start with what you can execute well today, then refine and expand once you’ve proven demand and established the right systems.
One way to start is by looking at bigger, more established companies for ideas, and determining how you can adapt those ideas on a smaller scale. If the enterprise company in your market has an entire maintenance business on the side, you don’t have to do the same thing, but you can pull one team member to take on outside vendor work part-time.
Focus on a realistic starting point and define how you will measure success before growing the initiative. When companies try to launch at full scale right out of the gate, they tend to overwhelm their team and dilute what already works. Getting started, learning, and adapting will take you much further than trying to be perfect before you begin.