Property manager is key to a profitable investment
With the majority of property investors now viewing their assets in Dubai as long-term wealth, many owners are choosing to utilise property managers to ensure the day-to-day management of their investment. A good property manager can ensure monthly cash flow, increase your revenues and provide you with peace of mind, reducing the day-to-day stress of managing your property and being a landlord. Whether you are a local investor with multiple assets or an overseas investor, effective property management can be crucial to maintaining your asset.
Buying a property is often the biggest investment you will make and hiring someone to manage your investment is a big decision. If you are considering outsourcing the management of your property, there are a few points to consider ensuring you are getting the best from your investment.
Firstly, a good property manager should not just look after the bricks and mortar but should also be able to understand how to manage the asset and ensure a good RoI. An experienced and knowledgeable agent will be able to benchmark comparable rental properties on the market and advise you of the optimal rental return you should receive from your property, providing guidance and a plan for how they can achieve the goals that will maximise cash flow.
This sentiment is echoed by a number of reputable property management companies. As Rakan A.T. Al Alami, managing director of Harbor Real Estate, told me, a good property manager should concentrate on optimising the maximum value for all managed properties while generating growing income.
Ensuring the property manager understands not only the RoI but also the cash flow is another critical factor. For example, are they putting in place a float to cover future potential costs? It is inevitable that there will be repairs and maintenance required — for example, the life of chiller and air-conditioning units in the UAE is only 10 years, so it is likely they will need servicing and eventually replacing, plus the regular wear and tear that comes from having a tenant. Your property manager should be thinking about these potential issues and ensuring they have put in place enough funds in the float to fix issues. As an investor, it should not be your responsibility to think about these things if you have an experienced property manager in place.
A good property manager should also know how to deftly market a unit to avoid long void periods. This includes everything from posting it on well-known rental websites, to taking quality photos and having a solid book of potential tenants. Ensuring both parties care about having the property permanently rented will help to maximise your return.
Investors can often get a higher caliber of tenant willing to pay premium rents through using a reputable property manager. Be sure to ask your manager how they vet their tenants, and also how they can help should any disputes arise, or if cheques are bounced.
Finally, ensure you understand what your level of involvement will be — for example do you simply want the manger to take care of maintenance, or do you need a full-service contract where the manager will take care of every aspect, from finding a tenant and managing contracts to providing management of a float for repairs? Real estate companies offer different property management services and it is important to understand what package suits you best and what the associated fees will be to avoid any surprises.
As part of this service agreement, you should also check how often the property manager will update you — will you expect monthly updates or just an annual statement? It is worth checking how they will generate reports for you as well — for example, if you are based overseas, then an online portal that you can login to view your statement of account will make life much easier. Regardless of your desired amount of communication, the quality of it is crucial, and you need to ensure you are apprised of all key aspects of your property.
In real estate, you make money by having a strategy and understanding your RoI. A good manager should work in partnership with you and manage your investment while maximising your return.
Whether you are a local investor with multiple assets or an overseas investor, effective property management can be crucial to maintaining your asset