As property management companies in the US struggle to balance rising costs with increasing competition, outsourcing to offshore providers is becoming an increasingly attractive option.
With its lower operating costs and large English-speaking population, The Philippines is one of the leading destinations for outsourcing property management services. If you’re a property management business looking to outsource your business processes to the Philippines, it’s important to note that while outsourcing brings a multitude of benefits, it does not come without a range of challenges.
Learn about how property management outsourcing works to help you weigh the pros and cons and determine whether outsourcing to the Philippines is a good fit for your business!
How Does Property Management Outsourcing Work?
Property management outsourcing is the process of hiring a third-party company to manage properties on behalf of property owners. This involves going through the following steps:
1. Assessing property management needs
2. Selecting a reputable property management company
3. Signing a contract and service agreement
4. Handing over property management responsibilities
The outsourcing company is responsible for managing the property, providing regular reports to the property owner, and ensuring that all tasks are completed efficiently and professionally. By outsourcing property management tasks, property owners can save time and money while ensuring that their properties are in their best condition.
What Are the Pros of Outsourcing Property Management Services to the Philippines?
Outsourcing property management services to the Philippines can offer many benefits to real estate companies. Below are the main pros of the said strategy.
Cost Savings
One of the main advantages of outsourcing to the Philippines is cost savings. The cost of living in the Philippines is lower than in many Western countries, which means that labor costs are generally lower. Property owners can take advantage of this by outsourcing property management tasks to a Philippines-based company. They can expect to cut down on operation costs by at least 70% through this strategy.
Skilled Workforce
The Philippines has a large pool of skilled workers who are fluent in English and have experience in property management. Along with knowledge and expertise in various related fields, such as financial management, customer service, and marketing, property owners can tap into a highly qualified and experienced workforce that can provide quality services.
High-Quality Services
Property management companies in the Philippines are known for providing high-quality services. Many companies have adopted international standards and best practices, ensuring that properties are well-managed and maintained to a high standard.
Time Savings
Outsourcing property management services to the Philippines can save property owners time and effort. By delegating tasks to an outsourcing company, property owners can focus on other important aspects of their business, such as acquiring new properties or expanding their portfolio.
24/7 Support
Many property management companies in the Philippines offer 24/7 support, which means that property owners can get assistance and support around the clock. This can be especially beneficial for owners who have properties in different time zones.
Access to Technology
Property management companies in the Philippines are known for their use of technology and automation tools. This can help property owners to streamline their processes, reduce errors, and increase efficiency, all without having to deal with high operating costs.
What Are the Cons of Outsourcing Property Management Services to the Philippines?
Property management outsourcing also has some potential downsides to consider. Here are some of the cons of outsourcing property management services to the Philippines.
Communication Barriers
While many workers in the Philippines are fluent in English, there may still be language and cultural barriers that can affect communication. This can lead to misunderstandings and mistakes, especially if instructions are not clearly communicated.
Distance and Time Zone Differences
Property owners may face challenges related to distance and time zone differences when outsourcing to the Philippines. This can affect communication and can make it difficult to coordinate tasks and schedules, especially if urgent issues arise.
Lack of Control
Outsourcing property management services to the Philippines means that property owners will need to give up some degree of control over their properties. This can be difficult for some owners who are used to having full control over their assets.
Security Concerns
Property owners may have concerns about the security of their properties when outsourcing to the Philippines. This can include concerns about data privacy and security, as well as concerns about the physical security of the properties themselves.
Limited Customization
Property owners may find that outsourcing to the Philippines limits their ability to customize services to their specific needs. This can be due to language or cultural barriers, or simply because of the fact that outsourcing companies may have standard processes and procedures that they use for all clients.
Risk of Turnover
The property management industry in the Philippines is highly competitive, and there is a high demand for skilled workers. This means that there is a risk that workers may leave their positions in search of higher-paying or more desirable jobs. Consequently, this can lead to disruptions in service and can require property owners to spend time and resources recruiting and training new staff.
Is Outsourcing Property Management Services to the Philippines Worth It?
Considering the pros and cons of outsourcing property management services, whether the strategy will be worth it or not will be on a case-to-case basis.
Outsourcing property management services can be beneficial for a variety of individuals or entities, including the following.
1. Property management companies that lack the time or expertise to manage their properties effectively
2. Property owners who own multiple properties and cannot manage them all efficiently
3. Real estate investors who want to focus on their investment strategy rather than day-to-day property management tasks
4. Landlords who want to delegate the responsibilities of rent collection, maintenance, and tenant screening to a professional property management company
5. Property owners who live far away from their rental properties and find it difficult to manage them remotely
6. Property owners who want to reduce their workload and stress levels by delegating property management tasks to a third-party provider
7. Property owners who want to ensure that their properties are managed in compliance with local laws and regulations
On the other hand, below are some examples of individuals or entities who may not benefit from outsourcing property management services.
1. Property management companies who have only one property and are experienced in managing it themselves
2. Property owners who have ample time and resources to manage their properties effectively and efficiently
3. Property investors who enjoy being hands-on and actively involved in their property management tasks
4. Property owners who have strong relationships with their tenants and prefer to handle tenant communications themselves
5. Property owners who have unique or complex property management needs that may be difficult for a third-party provider to handle
6. Property owners who want to maintain complete control over all aspects of their rental properties and are unwilling to delegate tasks to a third-party provider
7. Property owners who are not comfortable with the fees associated with outsourcing property management services
With the right strategy and partner, outsourcing property management services to the Philippines can help property owners to streamline their operations, improve service quality, and achieve their business goals.
Tips for Choosing the Right Property Management Outsourcing Provider
Since the success of property management outsourcing will rely on your outsourcing partner, it’s just right that you take your time in finding and screening the right offshore company to work with. Below are some tips for choosing the right property management outsourcing provider.
Determine Your Business Needs
Before outsourcing, assess the specific property management functions you need help with, and identify which tasks are best outsourced. This will help you identify which outsourcing provider can offer the services you need.
Research Potential Providers
Do your research and look for outsourcing providers that have experience in property management. Read online reviews and ask for references to ensure that the provider has a track record of delivering quality services.
Consider the Provider's Location
The Philippines has become a popular destination for outsourcing, but consider whether the provider's location is convenient for your business. Time zone differences can impact communication and turnaround times.
Evaluate the Provider's Expertise and Skills
The Philippines has become a popular destination for outsourcing, but consider whether the provider's location is convenient for your business. Time zone differences can impact communication and turnaround times.
Assess Communication Channels
Communication is critical when outsourcing. Look for providers that offer clear and effective communication channels, such as regular status updates, progress reports, and dedicated points of contact.
Analyze the Provider's Security Measures
When outsourcing critical business functions, it's important to ensure that your data and assets are secure. Check the provider's security measures and protocols, such as data encryption, firewalls, and access controls.
Review the Provider's Pricing Structure
Compare the pricing structures of different providers to ensure that you are getting a fair price for the services you need. Look for providers that offer flexible pricing plans and transparent billing practices.
Work With A Reliable Property Management Outsourcing Partner in the Philippines
When it comes to outsourcing property management to the Philippines, the most important thing to consider is the reliability of your outsourcing partner. A dependable partner will take care of all of your property’s needs just like you would.
At KDCI, we offer top-notch property management services, including but not limited to tenant screening, lease management, property maintenance and repairs, rent collection, and whatever else you and your property may need. More importantly, all our agents are fully vetted and prize empathy and quality of service above all else, so you can rest assured your clients are in good hands.
Learn more about our property management services! Click the button below to contact us.
