6 Things to Know About Property Managers
Core Eight has more than 10 years’ experience managing investment properties of foreign nationals, ranging from whole-building investments to single unit investments. We are proud of our reputation as a reliable, hands-on property manager. As the top English-speaking real estate and property management company in the Kobe area, we have broad market knowledge of the real estate investment market and an extensive network of professionals to handle anything from locating tenants, repairs and renovations, to complete build outs. One of Core Eight’s unique strengths is its ability to put together a team of creative professionals (designers, architects, high end suppliers, and construction companies) to reform (or renovate) your investment property that is tailored to your budget and taste.
- Do your Due Diligence on your Property Manager.
- How many years experience do they have managing property?
- Is their experience in the same kind of real estate that you want to invest in?
- Does the property manager have experience with, or feel comfortable, dealing with foreign owners or foreign tenants?
- Do they feel comfortable negotiating on your behalf?
- Are they willing to give you references?
- How many other units are they managing?
- Is the property manager willing to enter into a written agreement with you for his or her services?
- Setting the Monthly Rent. The rent should be high enough to maximize your ROI, but not so high that it makes getting and keeping tenants difficult. Your property manager should be knowledgeable about (or have access to information) comparable properties in the same area and their rentals. Generally, property managers have access to market information that is not generally available. This information will be helpful for the property manager to negotiate increased rent upon renewal if comparable properties in the area are also increasing their rental rates.
- Significant Marketing Experience. Your property manager should promote your unit on its own website and through major Japanese nationwide listing sites. In this way, the property manager can work with multiple real estate brokers to arrange viewings, receive applications, and answer questions about the property. Your property manager should also be responsible for doing background checks of your prospective tenants and make sure that chosen tenant gets renter’s insurance and a guarantor.
- Advice about Ordinary vs. Fixed-Term Leases. Ordinary lease contracts generally have a term of 2 years and can be renewed indefinitely by the tenant. Fixed-term contracts have a stated term (usually less than 2 year) and generally are not renewable. If you know that you may want to live in the property sometime or sell it in a certain number of years, fixed-term leasing may be your best option. However, the rent on fixed-term leases is generally lower than the rent for ordinary leases.
- Property Manager’s Fees. There are two different types of property manager’s fees. In one case, the property manager’s fees are based on the assessed market rent determined by researching comparable properties. The property manager pays you, the owner, a fixed percentage of this assessed amount even if there is no tenant. In the second type, the property owner takes a fixed percentage fee when rent is actually received. For example, Core Eight’s management fees are in the range of 6-8% of the monthly rent for residential units.
- Day-to-Day Management. Your property manager will take care of day-to-day management of your investment unit, including arrangements for any repairs for appliances. Your property manager will also make sure that all required payments for the building management and repair reserve fund are timely made. Property managers also should be proactive about resolving any tenant concerns. Property managers also take care of leasing management, renewals, and cancellations. Most importantly, your property manager will collect your rent and remit it to your bank account per your agreement.
For more information about Core Eight’s investment property management services, please click here.