Property management – tasks, duties, costs

The property management is the contact for tenants and owners and relieves property owners thanks to its services in various areas. However, the designation is not protected, so you should pay attention to several points when choosing it.

The tasks of the property management are manifold

If the owner of an apartment building hires a property management company, he can save immensely. Otherwise he would have to take care of the management himself. For most people, this would mean that they would first have to acquire various accounting and technical skills. In addition to finding tenants, looking after the property and bookkeeping, the many tasks of property management include the following:

Property management - tasks, duties, costs
  • Rents (verification of receipt, administration of funds, if necessary. Adjusting the amount of rent and enforcing the new rent)
  • Formulating new leases
  • Elaboration of individual agreements with individual tenants
  • Receivables and complaints management
  • Preparation of operating and ancillary cost accounts according to legally prescribed distribution key
  • Bookkeeping, budget planning and cost review
  • Settlement of costs incurred for repairs etc. (a separate account is set up for this purpose)
  • Providing evidence to the owner
  • Advertising the apartment and selecting the next tenant
  • Viewings and apartment handovers including handover protocol
  • Hiring service providers, checking the work (garden, cleaning service, winter clearing service, etc.), etc.)
  • Operation and regular control of facilities (e.g. B. heating system, water, gas)
  • Supervision of service providers (janitors, gardeners, cleaning service)
  • Commissioning maintenance, servicing and repairs
  • Commissioning of modernizations (after consultation with owner/landlord)

The exact tasks to be performed by the property management company are specified in the contract. There are no legal requirements for this.

There are different types of property management

When talking about property management in general, this can mean rental management, WEG management or condominium management. Their tasks partly overlap, but there are also clear differences.

The rental management

In a rented apartment building, the rental management is responsible for the above-mentioned points. It receives complaints from tenants, for example, and checks complaints by inspecting the property.

The WEG management

The WEG management takes care of the common property of a condominium owners' association (WEG). Unlike an apartment building, this is a multi-family or row house where the apartments or row houses are occupied by the owners. The tasks of WEG management include the following:

  • Collection and control of the house payments and management of the joint accounts of the owners
  • Accounting and annual statements, including maintenance reserves
  • Implementation of payment obligations
  • Defense against unjustified claims
  • Preparation of the business plan
  • Comparison of offers to minimize costs
  • Inspection of the common property to assess its condition
  • Identifying necessary actions and informing owners
  • Convocation to owners' meetings including taking of minutes
  • Drafting the contracts for the service providers who take care of the common property

Condominium managers are also responsible for inspecting the facilities and hiring service providers for recurring and one-time tasks. It is advisable to hire a property management company if there are more than 3 or 4 different owners, otherwise disputes can arise quickly. Theoretically, someone from the apartment community can take over the duties if he or she has the appropriate skills. However, to avoid conflicts of interest, it is better to have an outsider do the job.

The special property management

Condominium management is also residential management – similar to rental management. However, it refers only to individual apartments in a larger property. If, for example, in a house with 10 parties, 6 apartments are owned by individual owners who rent them out, and 2 apartments are owned by 2 other persons, each apartment owner can theoretically appoint his own property manager.

This person takes care of all rental matters, searches for new tenants and receives complaints. He is responsible for all the above-mentioned points, which concern the apartments assigned to him. Community property, on the other hand, does not fall within its area of responsibility.

Property management: costs depend on various factors

The costs associated with property management can only be roughly estimated, as there is no fee schedule. However, since there is a lot of competition in the property management market, prices have become relatively close to each other. For rental management, providers often charge between 20 and 25 euros per unit per month, and for WEG management between just under 20 and 30 euros. Parking spaces or garages add another 3 to 5 euros to the bill. Another popular method of calculation is the percentage of the cold rent. This is often around 5 or 6 percent. Differences in the amount of costs are caused, among other things, by

  • the number of housing units,
  • the condition and location of the property (costs may be higher in structurally weak areas),
  • The scope of the agreed tasks,
  • the rental clientele (tenants known to be complicated), and
  • The desired accessibility of the property management (usual working hours vs. accessible around the clock).

It is worthwhile to obtain different offers and compare the costs. Pay particular attention to additional costs charged for certain services: For example, this could be an hourly fee for owners' meetings or an extra cost for checking the heating system on a regular basis.

For example, for a house with 10 apartments and the same number of parking spaces, the costs could be between 230 and 350 euros per month according to the first type of calculation – plus the costs for the extra services. If, on the other hand, you assume a cold rent of 800 euros, the share for the apartments in the percentage calculation already adds up to 400 euros. A comparison is therefore important.

How to find the right property management

Basically, you should look for a property management company that is located in the vicinity of the property: Due to the inspection that is necessary from time to time and the role as a contact person for the tenants and owners, the headquarters of the management company should be within easy reach.

The term "property manager" is not protected and there is also no corresponding training profession. Consequently, since anyone can call themselves that, it's best to take a gander at the websites of the administrations in question: Are the people in charge trained real estate agents or graduated real estate managers resp. Real estate managers, you can assume that they bring expertise to the table.

Another way to convince yourself of the professionalism of the provider is to check whether the company belongs to an administrator association. If this is the case, it meets standards that are not required by law. The associations carefully consider who they accept and rely on relevant knowledge and experience. Many associations make a membership also dependent on whether the candidates have a pecuniary damage liability insurance concluded.

Inform yourself on independent evaluation platforms also about the experiences of other customers with the provider.

Conclusion: the careful choice of property management pays off

If you rent out a property or live in it yourself, but share common property with neighbors, you are well advised to hire a property management company. The administrators take care of all time-consuming tasks around the apartments, keep an eye on the general condition and point out necessary repairs or modernizations. They are a competent contact for complaints or questions from residents and take care of service providers for gardening, cleaning or winter snow removal service. Since the property management company receives access to important accounts from the owners, it is essential that it be trustworthy and well insured.