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How Big is the Property Management Industry?

There are over 300,000 registered property management companies across the US!

The need for competent property management has increased over the last several decades. Today, that demand is at unprecedented levels.

As a result, Keyrenter franchisees have seen their own portfolio of clients grow.

Macro Events Affecting Property Management

In the last two decades, several significant real estate trends have reshaped the property management industry. The Great Recession (2008) and the SARS-CoV-2 (COVID-19) pandemic (2020) have both turned the market in favor of real estate investors and prompted increased demand for property management services.

The Great Recession saw a wave of foreclosures and a subsequent wave of property investors buying real estate to rent. The remote work boom caused by COVID-19 saw many homeowners selling at peak prices and moving into rentals. Both events saw rapid turnover of renters due to volatile socioeconomic conditions. Successful investors during these periods turned to property management companies to place tenants, maintain property and improve investor margins—even amidst economic instability and uncertainty.

The future of property management is bright.

Not only are an increasing number of investors choosing real estate as their wealth-generation vehicle, but more people are renting as opposed to buying real estate. There’s growing demand for property management from buy-and-hold real estate investors.

Key Rental and Ownership Trends

There are several strong tailwinds propelling real estate investments and the demand for professional property management. Some of the most important trends Keyrenter franchisees need to consider include:

  • The ratio of renters to buyers is on the rise. Whether by choice or due to socioeconomic disparity, there are fewer and fewer traditional homeowners. Investments in rental properties have skyrocketed—as has demand for property management.
  • Lending restrictions and low household incomes discourage homeownership. After the sub-prime mortgage crisis that kickstarted the Great Recession, banks are more discerning with their lending practices. Renting is often the path of least resistance.
  • The need for professional property managers is growing. As investors grow their portfolios, the responsibility to service each property grows too great for them to manage. The best solution to maintaining margins is professional property management.
  • People always need a place to live. No matter the state of the economy, housing will always be in demand. It’s the only man-made commodity absolutely essential for life. Demand for a place to live facilitates demand for someone to manage the rental.

Keyrenter and our franchisees have thrived since 2007, and the property management industry has existed for centuries. To say that it’s a safe, predictable industry is an understatement—and its efficacy is further proven by these immutable trends.

Property Management by the Numbers

Property management figures are constantly in flux. However, the growth of the industry is undeniable.

Here’s a look at some of the key figures driving demand, according to research published by The Joint Center For Housing Studies of Harvard University [2021] and compiled data from the U.S. Census Bureau, Rental Housing Finance Survey [2021].

  • There are 44.1 million households renting in the United States.
  • Renters constitute 36% of all households.
  • 34.4% of renters are under the age of 35.
  • Homeownership is only increasing at a rate of 0.3% annually.
  • Total home sales in 2020 reached their highest point since 2006.
  • The national price-to-income ratio for homeowners is 4.4—the highest since 2006.
  • The average rate of demand for rentals is growing by 353,000 units annually.
  • Most rentals consist of single-family homes and 2-4-unit structures.The data is clear: fewer people are buying homes and more are renting. It’s a trend that’s likely to continue as current economic trends persist.

Now is the Best Time to Start a Keyrenter Franchise

There’s never been a better time to explore property management franchise opportunities through Keyrenter. The shift toward property rental, increase in demand for management services and reliance on property managers to preserve cash flows all add up to greater stability, opportunity and longevity.

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