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The property management sector is in flux as companies deal with waves of technology disruption, changing renter demands, and mounting operational pressures. Small boutique operators managing a few dozen units and giant behemoths running thousands of properties all face very different challenges and opportunities. This statistical tour d'horizon brings together what we know about the industry's growth, revenue, technology, and operations curves — and a few black swan events. It measures 2024-2025’s market consolidation and technological adoption against historical baselines. And it gauges the industry's anxiety about artificial intelligence and its impact on property managers.
Industry Landscape & Market Size
Company Size Distribution
Across all property management companies, units managed falls into four ranges: 50-499, 500-1,499, 1,500-4,999, and 5,000+. 47% of companies are in the first group, managing between 50 and 499 units. They're followed by 25% managing 500-1,499 units and 15% managing 1,500-4,999 units. Only 7% manage fewer than 50 units. The smallest group, 5,000+ units, makes up 6% of companies but accounts for a disproportionately large share of units managed.
Industry Consolidation Trends
The property management industry continues to consolidate. The share of companies managing fewer than 100 units shrank by 5 percentage points last year, while the share managing properties in multiple metropolitan areas grew by 4 points. Among the largest companies (those managing 1000 or more units), the average portfolio growth was 22,823 units, and the average number of owned units was 17,282. The median value of insured properties was $1.6 billion, with an average of $2.3 billion.
Property Types Managed
77% of companies manage market-rate multifamily residential properties, making this by far the most common type of property to manage. Single-family residential properties are second at 58%, followed by affordable housing at 38%, commercial properties at 22%, and both community associations and mixed-use properties at 18%.
Portfolio Growth & Expansion
Historical Growth Performance
82% of third-party property management companies report portfolio expansion over the past two years, and 84% report that revenue increased during this period.
Growth Expectations
91% of third-party property management companies plan to expand their portfolios over the next two years. 55% expect significant growth, and 36% expect moderate growth. Only 7% plan to stay the same size, and 2% expect to downsize.
Among companies planning expansion, 50% expect to grow their portfolios by 1-25% over the next two years, indicating measured but consistent growth strategies.
Growth Strategies
78% of third-party property management companies are actively seeking new clients over the next two years, up 7 points since 2023. Smaller numbers use other growth methods: 49% encourage existing clients to acquire additional properties, 36% seek to acquire other companies' portfolios, 31% diversify into different types of properties, 28% acquire or build new properties, and 23% expand geographically.
Revenue & Profitability
Revenue Growth Outlook
91% of third-party property management companies anticipate revenue growth in the next two years. However, those expecting significant growth have fallen from 47% in 2023 to 36% in 2024, while those expecting moderate growth have risen from 47% to 55%.
Despite optimistic projections, 21% of property management companies identify generating revenue to compensate for rising costs as a primary challenge heading into 2025.
Among companies planning revenue growth, 63% expect to grow by 1-25% in the next two years, suggesting realistic expectations aligned with market conditions.
Revenue Growth Strategies
68% of property management companies cite rent and resident-paid fee increases as their primary growth driver, followed by value-add property investments at 38%, technology-driven efficiency improvements at 36%, expanding service offerings at 34%, and client-paid fee increases at 33%.
Property managers focused on fees see owners as the source of most additional revenue: 36% offer additional maintenance or repair services to owners, up 5 points year-over-year, 36% offer additional services to owners (also up 5 points), 32% offer additional fees to residents, and 28% offer additional services to residents (up 9 points).
Operating Costs & Challenges
Cost Pressures
77% of property management companies say labor is the most painful cost pressure, including 77% citing labor costs for vendors and contractors and 74% citing employee labor costs. 71% say insurance premiums have increased, 64% say utilities, 63% supplies, 52% property taxes, and 50% technology costs.
Top Business Threats
43% of property management professionals cite maintaining high occupancy rates as their top business threat in 2025, up from 35% in 2024 and reflecting a sharp 20-point increase since 2023 when only 23% identified this as a concern.
Rising insurance costs rank as the second biggest threat at 39%, followed by inflation at 35% (down from 41% in 2024), rising taxes at 29%, government regulations at 26%, maintaining positive net operating income at 21%, and high interest rates at 21%.
Some pressures are easing: labor shortage concerns dropped from 21% in 2024 to 16% in 2025, continuing a three-year downward trend from 34% in 2023. Supply shortages declined from 11% in 2024 to 7% in 2025, and employee churn concerns fell from 13% to 11%.
Insurance Market Conditions
After 27 straight quarters of increases, property insurance premiums finally decreased for the first time since 2017. However, 71% of property management companies still report rising insurance costs. 91.8% of portfolios include properties in high-risk states (California, Texas, Florida, Louisiana, and Colorado), and 56% were impacted by both freeze events and named storms.
Profitability Context
Operating costs for multifamily rentals increased 9.3% between June 2022 and June 2023, while net operating income growth slowed to 3.5%—down dramatically from 24.8% in 2021.
Key Operational Metrics
Leasing Performance
Average vacancy days were 20 in 2025, down from 22 in 2024, while average unit turn time remained stable at 12 days. The number of applications per lease (a measure of demand) increased slightly, from 13 in 2024 to 14 in 2025. Renewal rates crept upward as well, to 70% from 69% in 2024.
Lead Generation
Zillow leads continue to outperform, with 39% of leads reported by property management companies to come from Zillow in 2025, followed by Apartments.com at 22%, property websites at 11%, Facebook Marketplace at 5%, current/previous resident referrals at 4%, and Rent.com at 4%.
Resident Satisfaction Measurement
The industry is improving in this area. In 2025, only 30% of companies reported not measuring resident satisfaction, down from 40% in 2024. Frequency of measurement among the rest was generally not annual: 26% measured monthly, 15% quarterly, 12% yearly, and 17% other.
Staffing & Workforce
Labor Market Context
The national labor market remains tight. In 2025 there were 8.2 million open jobs nationally versus 7.2 million unemployed workers, and a labor pool 2 million smaller than in February 2020. Shortages are especially severe in the skilled trades. Nearly 17 million infrastructure workers (plumbers, electricians, etc.) are expected to retire or otherwise leave their roles over the next 10 years.
Using Virtual Staff to Stretch Resources
24% of property management companies currently employ virtual assistants or overseas workers, while 18% operate as fully remote companies.
Among companies with virtual/remote staff, 73% assign them to administrative work, 48% to accounting/bookkeeping, 40% to maintenance coordination, 39% to leasing coordination, 28% to marketing, 20% to collections, and 19% to technical support.
Team Size Distribution
Property management companies usually want to keep staff size low, but with enough variation to make the overall distribution fairly uniform: 46% have 2-5 employees, 18% have 6-10, 16% are solo operators, 6% have 11-15, 4% have 16-20, and 10% have more than 20.
Hiring Expectations
Almost half (46%) of companies expected to hire in 2025, 49% expected to maintain current headcount, and 5% expected to decrease headcount. Staff training was a focus for 42% of companies as a way to improve efficiency, the same proportion as in 2024.
Technology Adoption
Rapid AI Adoption
The most notable technology change in 2025 was a rapid increase in artificial intelligence use by property management companies, from 21% in 2024 to 34% in 2025, a 13-point increase. Another 29% planned to use AI, and only 37% had no plans to use AI (versus 51% in 2024).
AI Adoption by Company Size
Larger companies were more likely to use AI: 47% of companies managing 5,000+ units used AI, compared to 39% of those managing 1,500-4,999 units, 37% for 500-1,499 units, 30% for 50-499 units, and 28% for under 50 units.
AI Adoption by Role
Executive leadership is the top driver of AI adoption, with 49% of VPs and corporate executives using AI in 2025, up 25 points from 24% in 2024. That's followed by office and operations managers at 42% (up 24 points), assistant property managers at 36% (up 16 points), regional property managers at 39% (up 6 points), property managers at 31% (up 10 points), and maintenance at 30% (up 16 points).
Influence of Company Encouragement
Strong influence: 69% of employees use AI in companies that encourage it, versus 23% in companies that are neutral, and only 12% in companies that discourage it.
But fewer companies encourage AI than discourage it: 25% encourage in 2025, down from 17% in 2024.
AI Use Cases
Communication with residents is the most common use of AI, at 60% of companies that use AI. Other common uses: communication with owners (25%), data entry (21%), intelligence for rent pricing (17%), work order management (17%), staff training (17%), data aggregation and reporting (16%), leasing funnel (14%), and renewals funnel (14%).
AI Benefits
Increased optimization and efficiency is the most common benefit at 66%, followed by better use of data (52%), better renter satisfaction (51%, up 8 points from 2024), reduced risk from human error (49%), better owner or client satisfaction (49%), cost reduction (43%), and being able to manage more units (35%).
Barriers to AI Adoption
Skepticism about reliability and accuracy is the #1 barrier at 40%, up from 34% in 2024. Other barriers: preference for status quo (38%), lack of familiarity with AI (35%), privacy or data security (33%), and ethical bias (28%).
AI Implementation Concerns
Security or data breaches is the top concern during implementation at 41%, followed by regulation and compliance of AI at 33%, training staff at 30%, lack of expertise to implement AI at 29%, cost or investment at 26%, and integration with existing technology stack at 19%.
Performance Impact of AI Usage
Companies currently using AI show stronger growth expectations. Among companies using AI, 83% expect revenue increases (compared to 72% of those planning to use AI and 71% with no AI plans), 73% expect net operating income increases (compared to 61% for both other groups), 72% expect growth in units under management (compared to 66% planning AI and 57% with no plans), and 53% expect headcount increases (compared to 43% for non-AI users).
Other Technology Priorities
Aside from AI, 36% of companies prioritize new technology adoption to increase efficiency in 2025, 32% prioritize better decision-making using data, and 19% prioritize software consolidation.
Services & Offerings
Payment Services
Online payments for rent are now nearly universal: offered by 94% of property management respondents, unchanged from 2024.
Flexible rent payments are growing: offered by 41% in 2025, up from 33% in 2024.
Other rent-related payment features: reporting rent to credit bureaus, 44% of property managers (no change from 2024); push and instant payments, 37%, down slightly from 38% in 2024; security deposit alternatives, 23%, down from 25% in 2024.
Willingness to Pay for Additional Services
About 80% of renters are willing to pay for additional services, according to property management respondents. The most popular services to offer include internet included (at 39% of renters), renters insurance (37%), renter rewards program (29%), pest control (26%), and cable TV included (24%).
Service Availability Gaps
Desktop portals for residents are available to 57% of renters but considered important by 76%, a 19-point gap.
Smart home technology features are available to 45% of renters but considered important by 61%, a 16-point gap.
Resident services that are part of the lease are available to 42% of renters but considered important by 71%, a 29-point gap.
Digital move-in services are available to 38% of renters but considered important by 60%, a 22-point gap.
Efficiency & Cost Reduction
Cost Reduction Strategies
The biggest cost reduction strategy is faster filling of vacant units, for 74% of property management respondents, unchanged from 2024.
Other cost reduction strategies: negotiating better rates for vendors, 46%; bringing maintenance in-house, 29%, up 13 points from 2024; using AI, 23%, up 8 points from 2024.
Efficiency Improvement Focus Areas
The company's own cost reduction is the most popular focus area for efficiency improvement, at 48%, down slightly from 49% in 2024.
Other focus areas for efficiency improvement: maintenance (42%), up from 40% in 2024; staff training (42%), up from 40% in 2024; adopting or using AI tools, 28%, up sharply from 17% in 2024; adopting new technology (36%), up from 31% in 2024; better use of data for decision making (32%), up from 28% in 2024.
Performance Expectations
Looking Ahead to 2025
Property management companies are bullish for 2025. Three-quarters expect revenue to grow, two thirds expect net operating income to grow, two thirds expect units under management to grow, and just under half expect head count to grow.
Fraud & Data Security
Fraud Incidence
Fraud is widespread in real estate management. Three quarters (79%) of companies of all types reported payments fraud in the last 12 months, and actually an even larger number (88%) reported data security fraud.
Fraudulent Applications
More than two thirds (70%) of companies say the number of fraudulent applications increased in the past year. Only a small minority (16%) feel completely confident that applicant documentation is genuine; half (50%) are fairly confident, 28% somewhat confident, and 6% not at all confident.
Security Concerns
Online Fraud: Do property management companies feel concerned about online fraud? Yes, strongly. Two fifths (40%) say they feel more concerned than a year ago, half (54%) feel the same, and 7% feel less concerned.
Data Security: For data security, 37% feel more concerned than a year ago, 55% the same, and 8% less concerned.
Apartment Market Data
Construction & Absorption
In 2024, the multifamily sector delivered 629,000 new apartment units — the most since 1986. And absorbed 612,000. But for 2025, delivery is down 20% to 497,000 units, and absorption is down 12% to 538,000 units.
In May 2025, annualized multifamily construction starts were 316,000 units. This was down 30.4% month over month, but up 5.0% year over year. Permits were up 1.4% month over month and 13% year over year. Annualized completions were 487,000 units in May 2025, up 0.2% month over month but down 6.7% year over year. In the past 12 months, completions have outpaced starts by more than 220,000 units.
Regional Leaders
Austin and Houston lead in permit growth from May 2024 to May 2025. Austin had 929 more permits year over year than Houston, plus it added the most young adults aged 20 to 34. Houston had 847 more permits year over year than Dallas.
Renter Insights
Renter Demographics
Renter households make up 35% of all U.S. households. Among renter households, 22% moved in the last year. The median age of a renter is 41 (33 for those who moved), and the median household income is $54,000, well below the U.S. median of $80,000.
Generation Z renters (18-30 years old) are 26% of all renters, but 44% of those who moved in the last year. Millennials (31-45 years old) are 33% of renters. Children are present in 37% of renter households, and 59% have at least one pet.
Renter Moving Plans
Renter stability is returning. Almost half (47%) say they plan to stay where they are indefinitely. This is the highest rate since 2021. Only 22% say they plan to move when their lease ends, and 31% say they are not sure what they will do. Of those who plan to move, 30% cite affordability as the primary reason.
Resident Satisfaction Impact
Resident satisfaction correlates with economic outcomes. Compared to residents who are neutral about their living experience, those who are positive are 530% more likely to recommend the property manager and 73% more likely to renew their lease. Those who are negative are 61% more likely to plan to move.
Maintenance Satisfaction Impact
Maintenance is the most important service. Those satisfied with maintenance are 146% more likely to recommend the property manager and 71% more likely to renew their lease. Those who are positive about communication are 169% more likely to recommend the property manager and 43% more likely to renew their lease.
Renter Technology Preferences
Renter technology expectations have sharply increased. The share of renters who want to complete at least some process online has increased 17 points since 2021 to 88%. The share who want to pay rent online or by card has increased 17 points to 75%, although only 58% are actually doing that now (a 13-point gap between desire and adoption).
Access to resident portals is very important to 75% of renters. Property manager reputation on sites like Yelp or Google is very important to 88% of renters.
Renter Financial Stress
Financial stress is high among renters. Only 55% say they can pay all bills on time and in full, down from 64% in 2022. Seven in 10 carry some form of debt. One in four has no emergency savings. Half of renter households are cost-burdened (paying more than 30% of income for housing), the highest share ever measured.
Half (51%) of renters say they rent because they cannot afford to buy a home, up from 32% in 2021. Two thirds say their rent has increased since early 2023.
Market Outlook
Market Outlook for Supply & Demand
The market waits for the supply-demand balance to tighten in late 2025 and 2026, as completions continue to outpace starts. For 2025, 40% of the top 50 markets expect rent growth above 3%, and 55% expect growth between 2 and 3%.
Frequently Asked Questions
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