Written by Shirley Baillie of S Baillie and Associates
With the increasing challenges being thrown at those working in the Sectional Title industry, it can rightfully be said to be a taxing genre in which to work.
Challenges include a poor economy which is putting financial pressure on owners in their personal capacity, and this directly affects Bodies Corporate (BC) and Homeowners Associations (HOA); for which the expenses are regularly increasing and further aggravated by some owners not paying the levies. These and other items impact the operations of the Managing Agencies (MA) daily. They will have their own challenges too, dealing with a plethora of Acts impacting on the running of schemes such as POPI, the Sectional Title Amendment Bill, and the requirements of the PPRA.
Despite the challenges, most of those working in the industry continue to enjoy it. One testimony reads: ”I enjoy helping people; I find it a challenge and rewarding when I can sort out problems; I love building relationships with people; it is a fast-paced, growing industry with a shortage of trained staff so I will always have a job; I learn something new daily; the financial rewards are good.”
The different-sized MAs offer different styles and methods of working; and for this reason, Portfolio Managers (PM) may find it more enjoyable to work in one type of MA than another. Taking the opportunity to work with different types of MAs will give you an idea of what is best suited to your personality. It will also prepare you for setting up on your own, which you may find is exactly where you want to go.
In summary, one size does not fit all – a BC or HOA may prefer to work with one type of MA, and the same applies to people who are making their career in the MA industry. It is all about personal preferences and how they fit.
Let us look at the various choices anyone wanting to enter the industry, can make:
The larger Managing Agencies offer great opportunities for those who are interested in a career in property management to gain experience, and they typically provide regular training. The bigger companies offer a range of support services; such as an in-house legal department, collections department, and separate maintenance and insurance service centres. Thus the PM will have less exposure to different aspects but will glean info from working with them. At the same time, the PM will have the opportunity to grow, be assisted by management support, collect a useful network, and establish a steady career path towards management. The PM also receives a salary at the end of the month and sometimes enjoys fringe benefits (such as medical aid, provident fund, and bonus cheques). The PM has the experience of office colleagues into which to tap. This leaves the PM to concentrate on dealing with the community scheme on a day-to-day basis.
Because the demands on PMs are continually growing; in recent years trained attorneys have been employed as PMs in some larger MA businesses. The larger structured companies are more equipped to afford the higher salary which goes along with this qualification, and they can sometimes also accommodate those who wish to study part-time.
Some of the negatives of working for a larger company could include being confined by a predetermined corporate culture, a set way of doing things, lots of red tape, the segmentation into different departments such as debt collection, legal, maintenance, and insurance which can result in dilution of responsibility and service delivery, as well as frustration when the PM is not solely responsible for the community scheme.
Medium-sized agencies are less likely to employ you unless you have either practical experience or some training as they seldom have the capacity to offer on-the-job training. They usually employ the “sink or swim method.” Taking time off to study could further be disruptive to the day-to-day demands. But joining an agency like this will give you the opportunity to develop a good all-around understanding of what the entire business is about. Here you also tend to form stronger relationships as you are likely to have fewer HOAs/BCs with which to deal since you will be doing most of the work yourself.
There are also many successful sole proprietors and small partnerships functioning as Managing Agencies. These comprise entrepreneurs who have the experience and confidence to set up on their own. Having worked in the industry for a while, they have typically established good connections with community schemes that may support them going forward. Many of these budding entrepreneurs start by acquiring some portfolio work which they do after hours at home, whilst they are still working for their current employer. A Restraint of Trade of one year applies in most cases, but it will not apply to the PM’s work, picked up on his/her own capacity. This enables a small portfolio to be built-up part-time – and gives the entrepreneur an understanding of what owning an agency entails – before taking a giant leap of faith to go into his/her own business full-time.
Why do people start their own business? Research is showing that budding entrepreneurs are people who want to help others, value giving great service, are keen to build long-term relationships, want to do it their way, and are passionate about their career in community schemes. They do not waste time with corporate politics; they can work from home; they can be flexible with their hours and yet still give their all to their clients. They recognise that they need to do it very well or face losing a client, which can be considered a personal rejection and will directly affect the bottom line. But a start-up will take cash resources, time, patience, and every ounce of energy you have.
Is it going to be worth it? Going it alone is risky, but it can be infinitely rewarding; emotionally and financially. No gain without pain! Should it not be to your liking, or you find that it is not working for you, with a clean reputation you will be ‘’snapped up” as there is a shortage of good PMs in this industry – but this is only a“safety net” thought!
These days it is easier to source financial aid to set up your business, and there are services around which will assist you both in your incubation period and going forward. All of this reduces the risk and makes it so much more feasible to set up your own MA and take this big step. When you make it work, you can look forward to steady growth and achieve the enviable position of being able to pick and choose the community schemes you take on. You will enjoy a steady income going forward, and have a business to pass along to a family or sell for your retirement. In addition, you will have enjoyed doing that for which you have a passion and have the knowledge of owning a business that has made a positive difference in the community scheme industry.