Condos and other communities can be extremely expensive to manage, lets look at a few things you can do to cut costs.
How Property managers & board members can reduce Condo/HOA management costs
Date Published: Sept 26, 2019
Managing a condo or HOA association takes a lot of time, energy and money. You have to manage unit owners’ expectations of what the community should be like, oversee regular maintenance of common areas, and manage payments and collections.
The good news is, you don’t have to do it all on your own. Property management software is designed to automate most of the important tasks involved in managing an association. This software will save you time and money while improving your performance.
Read on to find out how to minimize HOA and condo association running costs without sacrificing quality or performance.
Deal with delinquent owners
It’s important to develop clear consequences for delinquent owners. One way to do this would be to limit access to association facilities until the delinquent owner makes payment.
Condo Control Central’s amenity booking feature is a great way to regulate access to amenities. The software also enables you to view payments and see progress on collections straight from the cloud interface which you can access from your smartphone, tablet or PC.
Consult with an attorney before enforcing any rules related to delinquency to ensure that they’re in line with state laws.
Going green can significantly lower your running costs, and it’s easy to implement eco-friendly upgrades nowadays. Start by looking at the most energy and paper consuming areas so you can cut them out of your monthly expenses or at least reduce them.
Try going paperless by sending your residents documents electronically instead of printing them out. When our clients combine the electronic consent and announcement feature, they see a 40-60% decrease in printing cost and the amount of paper used.
You’ll have the option to go completely paperless which will decrease labor, increase productivity and improve our environment.
You can also go green by reducing the amount of energy your community consumes. You don’t have to install solar panels and wind turbines because that’s not for everyone. But, there are simple changes that you can apply to help you see quick results.
For instance, you can install water-saving irrigation systems or an energy-saving HVAC. Replacing your street light bulbs with LED versions can lower your electric bill by up to 50% and LED bulbs have a longer lifespan than regular units. So, you’ll save energy and lower your replacement costs by making one simple change.
Making sure that your openings are tightly sealed will lower your heating cost in the winter. Check your doors and windows for holes or gaps that might cause loss of air. If your openings are due for replacement, opt for weatherproof models this time around.
Use timers to control the time at which your lights switch on and off. That way, you won’t waste money by keeping the lights on when they’re not in use.
If you can, hire a professional engineer to help you weigh the costs and benefits of each solution as it relates to your community. While these upgrades have a high capital cost, they offer a tremendous return on investment.
Reduce tax expenses
Property tax is one of the biggest expenses for property managers and the prospect of reducing it can seem daunting or virtually impossible. While we’re not tax experts, there are certain common strategies that we can recommend in helping reduce your tax expenses.
For instance, look into maintenance costs that are tax-deductible including:
– Pest control
– Cleaning supplies
– HVAC filters and light bulbs
Insurance premiums are also tax-deductible, as are operating expenses like professional services (i.e. accountants and lawyers.)
Money that’s used in advertising is also tax-deductible, whether you advertise through print media, radio or online methods.
It’s important to make deductions during the same year that you paid the expense. Don’t forget to keep all of your receipts and file them through an efficient and well-organized system. You’ll enjoy the File Library feature from Condo Control Central which allows you to store all of your important files in a safe, reliable and accessible central location.
Lower your vacancy rates
The best way to lower vacancy rates is to keep your tenants or unit owners happy. The key to doing so lies in your ability to respond swiftly to maintenance requests. It’s also important to keep the property in ship-shape throughout the year. Failure to do so can cost you dearly in vacancy days and the expense of getting the property tenant-ready again.
Make sure the common areas are in good working condition and take care of landscaping. The exterior paint can also affect your property’s image so it’s important to keep it looking fresh.
Find creative ways to communicate
Look for cost-effective communication methods that’ll simplify the process. People don’t have time to read lengthy letters, emails, and newsletters. They’re also less inclined to pay attention to fliers and bulletin boards.
It’s better to state your point swiftly using short and concise messages that are delivered through an agreeable channel.
Texting is one way to do this, and we have found it to increase engagement with unit owners by a significant amount. Sometimes you need to change the delivery and format of your communication to garner attention from the community, so don’t be shy to switch things up by using different types of communication.
With Condo Control Central, you’re spoilt for choice with various modern communication methods to choose from. The platform allows you to stay connected with your community through announcements which you can send via text, push notification, email and lobby display. All of this is available on the software’s cloud interface, which you can access through your mobile phone or PC.
There’s also a discussion forum feature that unit owners can use to communicate about important topics that affect the community. Not forgetting the budget mail-out and website builder features for added communication options.
Reduce trash bill with a compost container
Incorporate a compost bin to reduce your annual trash bill. You must educate your community about the benefits of composting because some people might be apprehensive about separating their organic trash from the rest of their rubbish.
You’ll need the community’s approval before you implement a compost container so it’s in your best interest to make sure that unit owners are well-informed.
Post educational signs on the notice board and send out an email blast informing unit owners about the types of waste they can place in the compost bin.
The best part about using a compost container is that it reduces the amount of plugged drain incidents you deal within a year.
Apply innovative security measures
Property managers no longer need to settle for low-grade security cameras with grainy footage and a lone guard at the security gate. You now have access to high-tech gate-entry systems and HD cameras that provide you with clear footage of all your common areas. This helps you monitor the tennis courts, swimming pool, playgrounds, gym and other areas 24/7.
Most modern surveillance cameras are available at affordable prices and you can monitor them remotely using a smartphone app. They also come with cool features like a voice box and infrared vision that allows you to make out clear details in low light conditions. Not only will this lower your risk of criminal activity but you’ll find that it’s easier to identify who’s responsible for damaging common property.
Condo Control Central’s security and concierge features include security guard patrol technology. Your on-site security personnel can use it to create routes and checkpoints as they patrol around the property. The best part about this feature is that you can access it straight from your smartphone. Since it stores everything in the cloud, you’ll get real-time alerts about upcoming patrols and incident reports as well.
Plan for annual assessments
If your budget for next year includes an increase in assessments, you’ll do well to include them when adjusting New Year payments. Use Condo Control Central’s convenient digital payment system to make system changes and send alerts to unit owners simultaneously using the budget mailout feature.
This feature simplifies the payment process for unit owners, and you can generate transaction reports effortlessly to monitor monthly and annual trends.
It’s also worth noting here that you should have your yearly budget ready by the 1st of December so you can inform unit owners about payment increases before they go on annual vacation.
However, it doesn’t matter how much you plan, some people might not receive your messages, or ignore them altogether. That’s why it helps to have a contingency plan in place that’ll keep you afloat during January. The goal is to ensure that the association has enough funds in its coffers to pay the bills at the beginning of each year, while you collect payments from delinquent owners.
Review HOA contracts
Most HOA boards and property managers have multiple agreements with different vendors. This includes the maintenance provider, the security company, landscaper, etc. But, sometimes these contracts are outdated and have been in place for 5 to 10 years!
If this sounds like you, consider doing a review of all your vendor contracts and track your purchases. You could be wasting money on something as simple as trash collection or landscaping. Re-negotiating your agreements with vendors can help you reduce wastage and curtail maintenance costs by a significant amount.
It’s possible to reduce and even eliminate payroll costs by using property management software like Condo Control Central which has accounting integrations with leading accounting software like TOPS. CCC allows you to manage every aspect of your condo community on the go and from any of your devices. It operates according to cloud technology where all of your data is stored and it allows for paperless operation.
Some of the many solutions offered by CCC include:
– Manages administrative tasks
– Facilitating online payments
– Online amenity booking
– Online service requests
– Multiple digital communication channels
– Convenient record keeping solutions
Besides these great features, CCC offers ongoing support and an informative website with a regularly updated blog. With so many functions on offer, why would you need to hire an assistant or administrator?
Cut costs and eliminate the need for payroll by switching to property management software.
– Budget for maintenance expenses before they happen. For instance, if you’re dealing with an older building then you should expect maintenance costs to increase by 1.5% each year per unit. Make sure your operating fund account is well funded by budgeting accordingly and collect dues on time.
– Look into your insurance premiums and if you’re paying too much, negotiate a lower rate. If that doesn’t work, consider getting quotations from different providers.
– You can also cut costs by limiting the frequency at which you perform certain maintenance tasks like gardening and landscaping. You can definitely get away with doing less landscaping without sacrificing the property’s aesthetic beauty. As long as the area is weed-free, you don’t really need frequent landscaping.
– Evaluate all the services you’re paying for to ensure you’re not paying for a cable line or phone line contracts you’re not using. A service audit can be a real eye-opener and will help you get rid of unused facilities.
From going paperless to going green, there’s no shortage of ways to cut costs when running an association. All it takes is a bit of creative thinking and lots of automation. Luckily, you have access to Condo Control Central, property management software that offers a smooth transition to the digital world.
You can move all of your operations into its cloud interface today and start reaping the benefits of going digital. You can use this software to achieve paperless operations, manage maintenance, security, amenity bookings, budgeting, collections and so much more.
Unit owners can book amenities, make payments and maintenance requests online. Not to mention the wide variety of communication channels offered by the software, which benefit both owners and the board.
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