I’ve been doing more and more work in the property investment sector recently. I think there’s obviously an opportunity due to Brexit in the UK. But I’ve always been interested in how investors/landlords manage their properties from the comfort of their own homes whilst their property is in another country thousands of miles away.
Unless you’ve got access to your own private jet or have a relative close by that you trust then most investors and landlords are going to want to use a property management company to manage their property when they can’t be there. Today we take a little look at some tips for finding the right property management company for your circumstances.
Let’s kick back and let the experts handle it
This includes knowledge picked up along the way from articles, various friends, colleagues and family members.
Done your homework
Obviously there is a large amount of research to be done before hand. Such as looking into the law in the country you are choosing to rent the property in, finding out the truth about how long the rental market is where your property is located and do you plan to use the place at all yourself with friends and family or is this purely an investment to be rented out for the local market.
What’s the difference between a property manager and a rental manager?
I didn’t know there was a difference between the two but apparently there can be in some countries. But increasingly property management firms do both roles. So the rental manager is like a letting agent in the UK and will advertise the property, find people for the property and check those tenants in and out of the property. The property manager is more about the physical property itself. They look after any repairs, regular maintenance and bills for the property. If you are looking at a property management company that does all of these things on your behalf you may think great I don’t have anything else to do. Or you may want to question certain parts of this as all the control is now out of your hands. Some investors or landlords may want to find and bring their own tenants into the property or look towards the upkeep of the property themselves through local contacts. It may be worth seeing what scenarios ideally suit your properties situation.
What to look for in your property management company?
Some tips when looking for a property management company include:
- Pose as a renter to see what properties are offered at different times of year to see how long the rental markets actually are?
- Ask for recommendations from other landlords and investors renting property in the local area.
- What are the reputations of the companies like?
- Look online to see which property management companies come high on a search done by your target market in the property area.
- What contract do they offer? How much % of rent are they charging you? Does the contract cover everything that you need to be covered when managing the property?
- How easy are they to communicate with and how quickly do they get back to your queries?
- Once you have a shortlist you can interview these and ask them about their understanding of the market and how they would treat/manage the property. You’ll be able to judge who you can work with as well.
The finance bits
Of course you will have to look into the insurance and tax implications of all this as well. As your property is in a different country there appear to be a couple of main things to look at. Can you get insurance contracts done in English in that country if not can you get this reliably translated or do you need to get cover in the UK which maybe more expensive but enables you to have peace of mind that all is covered. On the tax side of things, you most likely will be paying tax in the country of the property and a slightly reduced rate in the UK as well look out for this as the tax man surely will be. But again your current accountant may be able to help you out with this for an increased fee if you’re not comfortable using the services of an accountant in the country of the property.
What else are you using the property for?
I touched on earlier how you are currently using the property and what the future holds for it can be a factor when researching which property management company to use. If it’s just an investment and the property will remain empty until the property management company find tenants for it then that’s fine you don’t need to think about this part. But if you currently use the property for family/friend’s holidays. Have a load of your own stuff in it or are worried about the condition of the property then you need to think again. As these could lead to peak season times when the property isn’t available to be rented as well as potentially putting potential tenants off as it contains lot of your personal knickknacks. This all depends on your objectives for the property that you would have researched initially and should align with those. You’re probably looking for the property to make you some cash or for a getaway for you once and a while and be a nest egg for the future.
I hope this has been informative, interesting and you liked reading it.
That’s all folks this week but I’ll be back again next week. Please subscribe to my Virtual Demon blog and I look forward to your comments and feedback.