Managing old properties efficiently

Efficiently manage your real estate

If you decide to buy a property as an investment, one of the fundamental questions is whether you want to manage it yourself or prefer to hand over responsibility. Most owners are aware that a property, like other tangible assets and capital investments, needs to be monitored and managed. However, many people do not realize that this involves much more than simply selecting suitable tenants and preparing the utility bill once a year. In order to save costs, owners sometimes prefer to take on the role of property manager themselves. This can be a sensible decision, provided the effort involved in good property management is not underestimated.

Becoming aware of the effort involved

The size of the property should initially be the decisive factor in the decision to manage the property yourself. The scope of future activities should play a central role in this assessment. This factor provides an initial indication of whether all aspects of operational property management can be carried out in-house. In addition to maintenance, calculation of ongoing costs and property and receivables management, this also includes liquidity and contract management as well as rental accounting and ancillary cost accounting. In the event of non-payment, debtor management and the issuing of debt collection orders, the corresponding termination of tenancies and possible legal action can be particularly time-consuming and unpleasant. It usually makes sense to hire a professional to work out a solution in the interests of the landlord AND the tenant.

Keeping a constant eye on developments in the local rent index and contractually fixing corresponding rent increases can also be time-consuming. However, the most important thing is to ensure that tenants receive ongoing support. In order for them to feel that their concerns are being taken seriously, a certain amount of social competence and time is required in addition to good accessibility and commitment.

Efficiency pays off

You should therefore relate all these points to your property and ask yourself: Can I afford this? After all, self-administration of a property is only worthwhile if it is guaranteed that all aspects of property management can be carried out to a high standard. As soon as you as the owner lose the overview, for example, if defects are not rectified in good time, contracts are not continuously checked for cost savings and up-to-dateness or the maintenance of equipment is neglected, it is not financially worthwhile to take over the management yourself. The letting of the property may even turn into a loss-making business.

If you decide to manage your property yourself, there are several ways to make the management as efficient as possible. Service charge billing in particular can quickly lead to misunderstandings and disputes that cost a lot of time. It is therefore a good idea to go into the billing modalities in detail in the rental agreement, whereby the allocation key for each item should be listed precisely. Deadlines must also be meticulously adhered to with regard to the service charge settlement. If the tenant has not received a statement by the end of the following year, the tenant is no longer obliged to make additional payments.

The points listed here should already make it clear how complex the demands on a property manager are. Ideally, you should not only become aware of this when you are receiving calls from dissatisfied tenants day and night and everything is getting out of hand. So don’t make the decision to self-manage your property lightly and only once you are aware of the duties and burdens involved.

If you want to spend as little time as possible on your property, you should appoint a professional property manager.

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