22 Essential KPIs for Property Managers: Supercharge Your Performance!

KPIs For Property ManagersWelcome to the ultimate guide to supercharging your property management performance! In this comprehensive blog post, we’ll explore 22 essential NARPM KPIs that every property manager should be tracking. From tenant churn to unit lifetime revenue, we’ll dive into each KPI in detail, providing you with real-life examples and formulas to help you gain a deeper understanding of the metrics that matter. By the end of this guide, you’ll be equipped with the knowledge and tools necessary to optimize your property management strategies and drive your business to new heights!
  1. Occupancy Rate: The proportion of occupied rental units in your portfolio. Formula: (Occupied Units / Total Units) * 100. Example: If you have 100 units and 95 are occupied, your occupancy rate is 95%.
  2. Average Days on Market: The average time it takes to rent a vacant property. Formula: Total Days on Market / Number of Units Rented. Example: If three units took 10, 15, and 20 days to rent, the average days on market would be 15 days.
  3. Rent Collection Rate: The percentage of on-time rent payments received. Formula: (On-Time Rent Payments / Total Rent Payments) * 100. Example: If you collect 90 out of 100 rent payments on time, your rent collection rate is 90%.
  4. Maintenance Costs: The total cost of maintenance and repairs for your rental properties. Example: If your maintenance costs for the year total $10,000, this is your maintenance cost KPI.
  5. Turnover Rate: The percentage of tenants who move out of your properties each month. Formula: (Number of Move-Outs / Total Units) * 100. Example: If 5 tenants move out of 100 units, your turnover rate is 5%.
  6. Net Operating Income (NOI): The income generated by your rental properties, minus all operating expenses. Formula: Rental Income – Operating Expenses. Example: If your rental income is $200,000 and operating expenses are $150,000, your NOI is $50,000.
  7. Vacancy Rate: The percentage of your rental units that are currently vacant. Formula: (Vacant Units / Total Units) * 100. Example: If you have 100 units and 5 are vacant, your vacancy rate is 5%.
  8. Average Rent per Square Foot: The average rent per square foot of your rental properties. Formula: Total Rent / Total Square Footage. Example: If your total rent is $200,000 and total square footage is 20,000, the average rent per square foot is $10.
  9. Lease Expirations: The number of lease expirations each month. Example: If 10 leases expire in a month, this is your lease expiration KPI.
  10. Marketing Cost per Lease: The cost of marketing your rental properties for each lease signed. Formula: Total Marketing Cost / Number of Leases Signed. Example: If your marketing cost is $2,000 and you sign 20 leases, the marketing cost per lease is $100.
  11. PM Profitability (PM Profit %): The percentage of revenue generated by a property management company that is profit after all expenses have been paid. Formula: (Net Profit / Total Revenue) * 100. Example: If your net profit is $50,000 and total revenue is $200,000, your PM Profitability is 25%.
  12. Profit Per Unit: The profit generated by each rental unit managed by a property management company. Formula: Net Profit / Number of Units Managed. Example: If your net profit is $50,000 and you manage 100 units, your profit per unit is $500.
  13. Total Labor Efficiency Ratio (TLER): The efficiency of a property management company’s overall labor costs. Formula: Total Revenue / Total Labor Costs. Example: If your total revenue is $200,000 and total labor costs are $100,000, your TLER is 2.
  14. Direct Labor Efficiency Ratio (DLER): The efficiency of a property management company’s direct labor costs. Formula: Total Revenue / Direct Labor Costs. Example: If your total revenue is $200,000 and direct labor costs are $80,000, your DLER is 2.5.
  15. Leasing Labor Efficiency: The efficiency of a property management company’s leasing labor costs. Formula: Total Revenue / Leasing Labor Costs. Example: If your total revenue is $200,000 and leasing labor costs are $40,000, your leasing labor efficiency is 5.
  16. Units Per Direct Team Member: The productivity of a property management company’s direct team members. Formula: Total Number of Rental Units Managed / Total Number of Direct Team Members. Example: If you manage 100 units and have 5 direct team members, your units per direct team member is 20.
  17. Revenue Per Unit (RPU): The average revenue generated by each rental unit managed by a property management company. Formula: Total Revenue / Number of Units Managed. Example: If your total revenue is $200,000 and you manage 100 units, your RPU is $2,000.
  18. Ancillary Revenue Per Unit: The additional revenue generated by a property management company through services. Formula: Total Ancillary Revenue / Number of Units Managed. Example: If your total ancillary revenue is $20,000 and you manage 100 units, your ancillary revenue per unit is $200.
  19. Unit Acquisition Cost (UAC): The cost of acquiring each rental unit managed by a property management company. Formula: Total Acquisition Cost / Number of Units Acquired. Example: If your total acquisition cost is $10,000 and you acquired 10 units, your UAC is $1,000.
  20. Unit Lifetime Revenue (ULTR): The total revenue generated by a rental unit over its lifetime of being managed by a property management company. Formula: Total Lifetime Revenue for a Unit / Number of Units Managed. Example: If the total lifetime revenue for a unit is $30,000 and you manage 100 units, your ULTR is $300.
  21. Tenant Churn: The rate at which tenants move out of rental units managed by a property management company. Formula: (Number of Move-Outs / Total Units) * 100. Example: If 5 tenants move out of 100 units, your tenant churn rate is 5%.
  22. Expenses as a % of Revenue: The percentage of a property management company’s revenue that is spent on expenses. Formula: (Total Expenses / Total Revenue) * 100. Example: If your total expenses are $150,000 and your total revenue is $200,000, your expenses as a percentage of revenue are 75%.

In conclusion, understanding and tracking these 22 NARPM KPIs is crucial for any property manager striving for success in the competitive real estate market. However, the foundation of accurate and insightful KPI analysis lies in efficient real estate bookkeeping and accounting practices. By investing in reliable real estate accounting services, you can ensure that your financial records are accurate, up-to-date, and ready to support your data-driven decision-making process. Remember, good real estate bookkeeping is the key to unlocking your property management potential, paving the way for increased efficiency, growth, and long-term success in your business.