‘Every resident has the legal right to know about where their money is going. A management software, especially a cloud based one, is a haven of records. Every dime and penny is accounted for in the entries. It does not just solve the purpose of a transparent financial administration, but it also builds the foundation of making comparative and ambitious budget plans for the community…A short analysis by ADDA had found that regular AMCs of just three assets out of several, in a 500+ units community can save over 32 lakhs INR on repair and maintenance work’, says Sangeeta Banerjee, Co-Founder & CEO, ADDA
Q. What are you Losing Out On Without an Apartment Management System?
To be frank with you, dear readers, you are losing out on a lot of money. And while money may not be the secret to happiness, sufficient funds are the secret to a harmonious apartment community. Every housing society or gated community has several heads of expenses to be taken care of every single day. A continuous supply of funds is necessary to ensure all daily maintenance work is taken care of without a glitch. An apartment management system helps you with exactly that – a dependable system to ensure continuous supply of funds for the smooth function of your community.
Q. What do you Lose Without An Apartment Management System?
You have a high defaulter rate : If you are a member of the Managing Committee or Resident Welfare Association, this is your headache number one. Defaulters. There are usually a number of residents who fail to pay their maintenance dues. Consequently, the community treasury never receives the optimum funds from the society. This leads to a continuous problem of fund shortage.
Q. How does this impact you in the long run?
Low funds translate to compromise of maintenance and repairs of community assets. Cost cutting becomes a necessity, leading to low quality servicing. The longevity of assets reduces and eventually, the MC has to shell out a bulk to either fix existing assets or invest in new ones.
High Auditor And Accountant Cost : Without an apartment management system, every functionality is manual. The one that demands the highest expenditure is billing and accounting. Invoices for maintenance are generated manually. Maintenance is calculated manually. The books of income and expense are reconciled manually. Such a huge dependence on manual labour, costs the community a lot more than just simply switching to automation. Also, imagine the amount of printed paper and stationery wasted on something that can be very well preserved digitally.
This manual dependence has another major con to it, other than rising costs. The con of errors. To err is human and that often shows up in maintenance calculation and invoice generation. Alongside, there is the issue of making either no investments or wrong investments, causing the society to lose out on best interest rates. Often, due to ignorance, taxes are not collected properly. This results in the apartment complex having to pay hefty tax penalties. Again, an issue an apartment management system can solve easily.
Repairs Wait For Funds : Heavy wear and tear of community assets is inevitable. A 500+ units residential community, sees 600+ visitors (e.g., delivery boys) walking in everyday and using the community assets (e.g.elevators). Even before a repair issue surfaces, it is important to conduct regular servicing of these assets to increase longevity. However, low funds compel MCs to disregard maintenance work and only focus on an asset once it has broken down and requires repairs.
A short analysis by ADDA, had found that, regular AMCs of just three assets out of several, in a 500+ units community can save over 32 lakhs INR on repair and maintenance work.
Q. How Does An Apartment Management System Make Things Better?
Lets share the good news with you first – you will see revenue growth.
Lower Defaulter Rate : The most common case of defaulting, is not unwillingness to pay. The root cause is simple. People forget. The ratio of unintentional defaulters to intentional defaulters is 5:1. That’s right 80% of your defaulters are unintentional. A gentle reminder before the payment dates approach, goes a long way to gently nudge residents to pay their dues on time. Apartment management systems can be set up to send automatic reminders to all residents about their maintenance due. The admin in the backend of such systems, can trigger repeated reminders to help people pay. The online payment facility helps them make payments quicker, faster and on the go.
Communities using software like ADDA, have recorded 60% decline in defaulting rate, recording exponential growth in funds.
Compliance With Housing Community Laws and Bye-Laws : There are two ways in which apartment management systems can help in this and save you a lot of hassle.
- The maintenance bill is calculated keeping in mind the taxes to be included, as well as maximum late payment penalty that can be imposed. Oftentimes, ignorance leads to wrongful tax calculation. This is taken care of by the automated tax calculators in the system algorithm. With the system’s guidance on the permissible late payment penalty rates, serious disputes even legal disputes from members can be avoided.
- Document sharing features help each and every resident to be aware of the laws and bye laws implemented in a specific society. Legal education contributes to minimum conflict among residents due to absolute clarity on community rules and regulations.
Greater Transparency : A residential community collects crores of funds per year. Every resident has the legal right to know about where their money is going. A management software, especially a cloud based one, is a haven of records. Every dime and penny is accounted for in the entries. It does not just solve the purpose of a transparent financial administration, but it also builds the foundation of making comparative and ambitious budget plans for the community.
Automation : Look a little around you. Your transportation is automated with several mobility solutions in the market. Your food delivery is automated. And so is your shopping experience. What is stopping your home from getting automated.
Q. Apartment management systems are the new talk of the town for home automation. Why is automation necessary here?
The MCs are working professionals with hectic professional and personal life. Manual calculation or supervising manual efforts on billing is not something the present generation of MCs can afford. Hence, automation. Let a software algorithm take care of maintenance calculation as well as collection. Auto generation of invoices, receipts, online payment gateways save several hours of time. Needless to say, saving precious community funds too.
The other significance is auto entries in books that are already structured for accounting. All tabs required for a successful audit are preset and entries automatically fill up the columns. The best part? Every detail needed for a balanced book is on one platform, instead of multiple manual registers. It saves the MC’s time, the Auditor’s time and the in house accountant’s time. With these jobs taken care of by automation, each stakeholder can concentrate on strategizing to achieve the final aim – financial sustainability.
Smooth MC Handover : MCs are like governments of the country. They are meant to change. A smooth MC handover is a necessity to guarantee continued development of a residential community. With an apartment management system, this is possible and easy. All one has to do is transfer admin rights of the software to the new MC and voila! The handover is done. The new MC can always pick up from where the previous one left.
Financial sustainability is the dream for every residential community globally. They must be independent to handle all eventualities on a smaller scale. The industry of apartment management systems has grown to assist residents worldwide striving for a community that is an idyll of governance and habitability.