Property management and facility management

An overview of various property management companies

There are basically two different types of property management:

• The condominium owners’ association (WEG) management
• and special property management (SEV) including tenant management
.

Anyone who owns a rented condominium cannot avoid condominium management. This is mandatory, while condominium management is optional. Whether this form of management is used depends entirely on whether the owner attaches more importance to having no expenses or to achieving the highest possible return. Although the overall costs of property management are not excessively high, they do reduce the profit. It can therefore be worthwhile taking over the management of your property yourself in order to achieve a higher return and thus increase your passive income. This decision therefore depends on the type of investor: outsource work or maximize cash flow?

Condominium management

In the case of apartments in a multi-party building, it is not only your own apartment that needs to be managed, but also the common property. The common property includes everything that – as the name suggests – is used jointly. This includes the land, the roof of the building, the stairwell, the terraces, the paths, etc.

The condominium management takes care of the financial management of the common property, including the preparation of a business plan, as well as the technical management. It also takes care of convening the apartment owners’ meetings, taking minutes and concluding contracts with the janitor or cleaning staff. Condominium owners’ meetings must be convened at least once a year in accordance with Section 24 (1) of the German Condominium Act (WEG). The timing of these meetings is not prescribed by law, but in practice is usually set for the first third of the year.

Costs:

The costs of condominium management amount to an average of 20 – 35 euros per apartment per month. It should be noted that the costs for the condominium management itself cannot be passed on to tenants. However, the following costs can be passed on::

• Cleaning
• Water
• Waste water
• Waste disposal, etc.

SEV (special property management) incl. tenant management

Special property management is optional. While WEG management concerns the common property of a condominium owners’ association, SE management is exclusively responsible for the client’s apartment. Special property management is primarily required when a tenant reports a defect. The SE administrator then inspects the apartment to determine the defect and initiates and monitors the corresponding repair work.

Example: A tenant discovers that the tap in his bathroom has a leak. He does not contact the landlord to report the damage, but instructs the SE administration to identify and, if necessary, repair the damage. Tenant administration or tenant management is also not mandatory as a component of the SEV. Landlords are therefore free to take over the rental management themselves. However, the areas of responsibility here are also very wide-ranging.

What does rental management cost?

Our clients occasionally book rental management through us when they buy and rent out a property. In our experience, the monthly costs for rental management are usually around €25-35.

Where does rental management help?

Among other things, the rental manager monitors rental payments, handles the dunning process, prepares the utility bill, handles correspondence with the tenant, finds a new tenant in the event of a termination, carries out viewings and concludes the rental agreement.

Conclusion

The above lists are by no means exhaustive; the areas of responsibility of the individual property management companies are too extensive. If you are an investor who does not want a lot of work with your property, you can outsource many tasks. To keep the costs of this as low as possible, you can take advantage of our 360-degree package. What does this mean?

• We find the right property for you in economically strong locations,
help with the financing,
• support with tenant management and
• also organize the administration of the property.

The individual modules can be booked as an option. Our aim is to support you with your real estate project so that you can sleep soundly at night, generate passive income in the future, save costs and not have to worry about anything else. All of the above forms of management are subject to their own regulations. To ensure that your property is managed properly, it is important to have the right partner at your side.

Arrange a free initial consultation (appointment in the office, by phone, Google Meet) with us and we will explain to you in detail what our 360-degree package includes and how you can acquire and manage your first (or second) property without any stress.