Board Members and Condo Residents: Is your condo property management experience leaving you with more questions than answers? Are you wondering where it all went wrong? Look no further. In this article, we will explore the common pitfalls and challenges faced by condo property management and provide insights into what might have caused things to go astray!
Operating a condo property effectively requires a delicate balance of several crucial factors – maintaining the property, enforcing rules and regulations, managing finances, and keeping residents happy. Unfortunately, condo property managers may struggle to find this equilibrium, leading to conflict between condo property management versus board members and/or residents,and a decline in the condo community’s satisfaction.
To get to the root of the problem, let’s explore the various aspects of condo property management that often go awry. From poor communication and lack of transparency to inadequate maintenance and ineffective financial management, understanding these areas of failure can help shed light on potential solutions.
If you've been left feeling frustrated and disillusioned by your condo property management experience, join us as we uncover the underlying issues and explore ways to set things right. It's time to regain control and set a course for a successful condo property management future.
Common Challenges Faced in Condo Property Management
The Race to the Bottom: You Get What You Pay For
Property management companies are stuck between a rock and a hard place; they’re suffocated by rising costs (as we all are!), and the pressure from condo boards to keep management fees low (such as not increasing contract prices, also known as a CPI increase) in order to keep the condo maintenance fees low for condo owners.
Overall, the condo industry is involved in a “race to the bottom”, where many property management companies are undercutting bids in order to gain contracts… but at what cost? In order to meet the demands of condo boards for rock-bottom prices, property management companies experience challenges in finding and keeping reliable staff and condo managers, may end up cutting back on training opportunities, and look to hiring more limited license condo managers.
“There are dire implications in hiring a Manager without the necessary skills or experience to handle complex tasks and doing so will cost the Corporation more money in the long term. In other words, you get what you pay for. Why is this important?” -Nicholas Chirametli, President of City Sites Property Management Inc.
There are so many ways that the quality and experience of your condo manager impacts your condo community, so this is one area where condo boards should take special care to ensure the right professional (and property management company) is engaged to meet their expectations and the needs of their community. It’s important to objectively consider whether the compensation meets these needs and is sustainable for providing the condo corporation with the services that the building and its residents require.
While there’s no excuse for negligence or truly terrible service, it’s important to start this deep dive into where it all went wrong by looking at what the expectations of property management are, and whether that’s sustainably captured within the existing relationship between the current property management company and the condo community it’s engaged to serve.
“If the income to the Management Company does not increase year over year, how can Property Management Companies offer and sustain competitive salaries for their employees?" -Nicholas Chirametli, President of City Sites Property Management Inc.
Learn more about the impact of contract (CPI) increases and its impact on the quality of property management services in condo corporations:
Lack of Communication and Transparency
One of the most significant issues that can lead to trouble in condo property management is a lack of effective communication and transparency. When residents feel left in the dark about important decisions or changes, it can breed frustration and mistrust. Without clear channels of communication, residents may not have a voice in the management process, leading to a disconnect between the management team and the community.
Transparency is equally essential. Residents should have transparent access to information about the property's financial health, upcoming projects, and any changes to rules and regulations. We recommend ensuring that the collective residency be kept in the loop on a proactive basis, rather than only during Annual General Meetings (AGMs) or other Special Owner’s Meetings - or worse yet, when a very unhappy resident slaps the condo manager and board with a lengthy Request for Records (which the corporation must comply with, for appropriate documents).
When there is a lack of transparency, residents may feel like they are being kept in the dark or that their concerns are being ignored. This can create a hostile environment and lead to conflicts between residents and the management team. Unfortunately, situations like these can even lead to harassment in condos - an issue that can be prevented by proactively keeping residents in the loop.
How can condo corporations use communication to not only educate residents but create a sense of community? And how does this prevent not only a breakdown in the relationship with property management, but can also help cool down the current climate of incivility, violence, and harassment in condos?
“First, condominiums should regularly educate residents about what constitutes harassment and violence. This can be done through newsletters, online resources and in townhall meetings. The board and management must also promote a safe workplace and living environment. They should encourage a sense of community and respect among residents.
This can be done through any number of initiatives. For example, by organizing social events and activities that promote respect, inclusivity, and tolerance. Stronger connections among residents, management and directors can help deter incidents of harassment and violence”. -Deborah Howden, Condo Lawyer and Partner at Shibley Righton LLP.
To address such challenges and the increasingly dangerous levels of frustration seen across the industry, condo property managers need to prioritize open and honest communication. Regular newsletters, community meetings, and online forums can be effective tools for keeping residents informed and engaged. Additionally, implementing a transparent system for financial reporting can help build trust and ensure residents have a clear understanding of how their fees are being utilized.
Click here for more resources about harassment, communication, and conflict resolution.
Inadequate Financial Management
Another area where condo property management often goes wrong is in financial management. Condo properties have complex financial structures, with multiple revenue streams and expenses to consider. From collecting monthly fees to budgeting for repairs and maintenance, managing the financial aspects of a condo property requires expertise and attention to detail.
Unfortunately, many property managers lack the necessary financial skills or resources to effectively handle these responsibilities. This can lead to mismanagement of funds, budget shortfalls, and delayed maintenance or repairs.
“Imagine if the Corporation hires a Property Manager that is inexperienced in contract negotiations or financial planning. What impact will this inexperience have on the Corporation’s financial position throughout the fiscal year? The Corporation might not benefit from the savings it might otherwise receive when a shrewd Manager monitors the Corporation’s finances.” -Nicholas Chirametli, President of City Sites Property Management Inc.
To address this issue, condo boards must double-check that the property management company that they engage to manage their condo corporation and its finances has a strong supervisory and accounting team. These experts can train the condo manager to be financially prudent, and assist the condo manager in developing realistic budgets, ensure timely collection of fees, and provide guidance on financial decision-making.
As the saying goes, “it takes a village”, and condo managers need a strong support system behind them to support them in their role, including the assistance of a well-rounded accounting team to help process timely payments and maintenance fees, and create reliable budgets.
Maintenance and Repair Issues
Maintaining the physical integrity of a condo property is crucial for the well-being and satisfaction of its residents. However, inadequate maintenance and repair practices are a common challenge faced by condo property managers.
It’s important to remember that neglected maintenance issues can quickly escalate into larger problems, impacting the overall safety and value of the property. From malfunctioning elevators and leaky roofs to faulty plumbing and electrical systems, unresolved maintenance issues can frustrate residents and lead to costly repairs down the line.
To tackle these challenges, property managers need to prioritize proactive maintenance. Regular inspections and preventive maintenance programs can help identify and address issues before they become major problems. Additionally, prompt response and resolution of maintenance requests can go a long way in fostering resident satisfaction and maintaining the property's value.
Having an Annual Planner for the condo corporation’s operations and preventative maintenance is crucial to staying on track with maintenance and repair issues. Stratastic has streamlined this process for condo managers and boards via our free Planner+ feature, which automatically inputs corporation-specific information, provides season-specific suggestions, and allows the users to add any further tasks and reminders necessary for their condo corporation!
Sign up now to use the Planner+ feature (for free) and jump-start your condo corporation's annual planning!
Implementing a robust maintenance management system can streamline the process and ensure that all maintenance requests are tracked and addressed promptly. This system should include a clear process for reporting issues, a reliable team of maintenance professionals, and a schedule for routine inspections and maintenance tasks.
Due to budget constraints or lack of proactive planning, necessary repairs and maintenance tasks may be overlooked. In addition to condo managers (hopefully) using Annual Planners to stay on top of maintenance and repairs in their condo corporations, some property management companies leverage property management software ("proptech"). Proptech can be a key virtual assistant to help condo managers prevent maintenance and repair issues from piling up and turning into major upset within their condo community.
“If a firm wants to make sure their managers have time to provide a client-focused service, the decision on proptech seems obvious: adapt and adopt, or abdicate” - John Recker, Property Manager at Meritus Group Condominium Management.
It’s important to verify what kind of proptech software your property management company is using, both within your condo corporation and internally. We recommend checking out its features and seeing how they can be fully leveraged to benefit the board’s needs, along with that of the community, and consider conducting an analysis of other available proptech to see the best fit for your condominium’s needs.
Check out proptech options on our vendor directory, My Condo Vendor.
Legal and Regulatory Compliance
Condo property management is subject to a myriad of legal and regulatory requirements, such as those from the government (laws such as those dealing with The Condominium Act, the Condominium Authority of Ontario or CAO, the Condominium Management Regulatory Association of Ontario or CMRAO, etc.) or other licensing bodies (the Association for Condominium Managers of Ontario or ACMO, etc.).
Failure to comply with these obligations can result in legal disputes, fines, and damage to the property's reputation. From local building codes and safety regulations to fair housing laws and environmental guidelines, property managers need to stay abreast of the ever-changing legal landscape.
To ensure compliance, property management companies should invest in ongoing education and training for themselves and their team. Staying informed about current laws and regulations can help prevent costly mistakes and legal issues. Additionally, working with legal professionals who specialize in condo property management can provide valuable guidance and support in navigating complex legal matters.
You can find a condo lawyer on Stratastic’s vendor directory, “My Condo Vendor”, or a variety of lawyers via the Law Society of Ontario!
Poor Community Engagement and Conflict Resolution
As you’re likely starting to understand by now, communication is important for residents and creating community. Moreover, a strong sense of community is absolutely essential for a successful condo property management experience, and keeping the board satisfied with the property management company’s services.
However, poor community engagement and conflict resolution can create a hostile environment that negatively affects resident satisfaction and can even impact property value. When residents feel disconnected from their community or have unresolved conflicts with their neighbors or management team, it can lead to a breakdown in trust and cooperation.
To foster a sense of community, property managers should prioritize community engagement initiatives. Regular social events, educational workshops, and volunteer opportunities can help bring residents together and create a positive atmosphere. If the condo manager doesn’t have the time to take this on themselves (and many don’t), and neither does the condo board (and again, many don’t!), we strongly suggest creating a Social Committee, Communications Committees, and other such initiatives to recruit volunteers to help! Many condo corporations have some active residents who want to be heard and contribute to their community, so this may be the perfect manner to do so!
Strategies to Improve Condo Property Management
Above, we’ve explored some problems and solutions for common challenges faced in condominium property management. Let's recap now.
Key Takeaways for Solving Where Condo Property Management Went Wrong and Preventing Future Muck-Ups
Pay Up, Level Up: First and foremost, boards need to understand that the management services have to be sustainable and their expectations must be in line with the contracted services and costs. It’s important to ensure that the property management company and condo manager are adequately compensated for their services, especially if the board of directors and residents are expecting high-quality services. With the current staffing shortage in Ontario’s condominium industry, compensation is key to attracting and retaining top talent as property management professionals for your condominium corporation. We warn that this is not a category to be “penny wise and pound poor” on, and encourage boards to budget accordingly.
Communication and Community Engagement: Communicating reliably and transparently with the residency is imperative to ensuring that the community feels heard and informed as to the ongoing matters of the condo corporation, which is likely their home and biggest investment. Shine a light on ongoing matters rather than making residents feel like they’re kept in the dark, and consider creating committees for your most active residents to lead and participate on. Such committees can be leveraged to host social functions, communicate more, or find another common ground on which to build a sense of community. By initiating such committees, boards can offload a substantial amount of this important but large task from their condo manager, allowing management to focus on the more specific particulars of their role within the condo corporation and community.
Financial Matters: Perhaps one of the most important aspects of condominium operations and managements are its finances, so it’s no surprise that the proper collection of condo maintenance fees and timely payment of invoices is a key factor for condo board and resident satisfaction. Boards can prevent inadequate financial management by checking the strength of the system that their condo manager has, such as the expertise of the property management company’s accounting department, the support of their supervisor, and any other available resources (such as software).
Maintenance and Repair Issues: Speaking of software, or proptech, the task of maintenance and repairs is another category that can benefit from some virtual assistance. It’s important to ensure that the condo manager has a solid system in place to conduct regular repairs and maintenance, such as the use of annual planners and any related software that can be beneficial to the maintenance of the property.
Legal and Regulatory Compliance: This one boils down to ensuring that the property management company is knowledgeable of any legal and regulatory compliance that they’re obligated to follow, and prioritizes the appropriate training of their staff to carry out duties in acceptable ways.
Hiring a Professional Condo Property Management Company
One of the most effective ways to address the challenges in condo property management is to hire a professional condo property management company. These specialized companies have the expertise and resources to handle all aspects of property management, from financial management and maintenance to resident communication and conflict resolution.
By outsourcing property management to experts, property owners can ensure that their investment is in capable hands. Professional management companies have a deep understanding of the unique challenges associated with condo properties and can provide tailored solutions to meet the specific needs of each community.
In addition to expertise, condo property management companies often have access to advanced technology and software systems that can streamline operations and improve efficiency. From online portals for residents to submit maintenance requests to automated fee collection systems, these tools can simplify processes and enhance the overall management experience.
When considering the right fit for your condo corporation, boards should ensure that they understand the specific needs and requirements of their property and community, and the expertise required to encompass it in an effective and efficient manner. After executing a tender for the appropriate scope of work, be sure to assess candidates thoroughly, including whether they have similar properties to yours, have dealt with the types of issues that you require solutions for, and to check out their referrals and reviews.
You can check out options and reviews of property management companies on our vendor directory, My Condo Vendor.
Conclusion: The Future of Condo Property management
Condo property management can be a complex and challenging endeavor. However, by addressing the common pitfalls and challenges faced in this field, condo managers and boards alike can set the stage for a successful future. Ultimately, property management is a partnership between the two parties, and both have to be committed to working together effectively and proactively to keep their condo corporations well-maintained and residents satisfied.
Open and transparent communication, effective financial management, proactive maintenance procedures, legal compliance, and strong community engagement are all key elements in achieving success in condo property management. By prioritizing these areas and while working with a professional management company and condo manager, boards can overcome the challenges and provide a positive and fulfilling experience for residents.
It's time to take control of your condo property management experience and pave the way for a brighter future. With the right strategies and a commitment to excellence, you can turn things around and create a thriving community that residents are proud to call home - and you’re proud to be on the board of directors for.
-Stratastic Inc.
P.S. We know serving your condo community isn’t easy, which is why Stratastic has many free features available to support Directors just like you through the challenges that you may face. Check out all the ways that we can help you help others.
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