Tag

Tag :

Property Management Challenges.

Tarleys Trust 0 comments 22.01.2016

As any property management expert can attest, managing a property is not without its fair share of challenges. This is one of the biggest misconceptions about the property investment industry, and one that many homeowner renting out their property will eventually realise – often only after they have tried to manage the property themselves. While the management of property may seem like a straightforward, easy tasks, in reality it is a demanding, full-time job in itself to effectively manage a property – even if it’s a small apartment or commercial space that has few tenants and minimal upkeep required. Some of the biggest challenges for managing a property in South Africa or abroad include the following common problems:

    • Tenants not paying on time

One of the biggest problems facing landlords is tenants who do not pay their rent on time. Rent collection is by far one of the most tedious and stressful aspects of property management, and with repeat offenders always paying their rent late, it can cause huge problems if property owners are relying on rent income to help towards their bond repayments or other costs. Screening of tenants before any lease is signed will go a long way in preventing issues such as this, but many landlords do not find the time or capacity to do this properly. A good management company has both the manpower and know-how to do proper screening and even credit checks and criminal background checks, ensuring better quality tenants and fewer issues with payment all round.

    • Lack of property upkeep

Another common tenant issue is lack of property upkeep. Maintenance of your property in South Africa is something that has to be done at various points; however when tenants do not take caution in keeping the property well-maintained, routine upkeep becomes constant fixing and maintenance, often at the expense of the property owner. Damage to property can result in tenant fines or even eviction, but many tenants continue to show disregard to the property, which results in warning letters, constant calling out of caretakers and other related stresses.

    • Complaints against tenants

Noisy tenants, late night parties, drunk and disorderly conduct, disputes with neighbours, noisy pets, illegal braais on the balcony and other complaints against tenants is something no property owner wants to face. Knowing how to deal with complaints and how to deal with unruly tenants too is something that property management experts are able to do effectively and efficiently, taking out the stress of homeowners having to deal with disputes on their own without the experience and know-how to manage these issues properly.

    • Evicting problematic tenants

When tenants have reached their maximum warnings and are consistently defaulting on rent, or causing problems for other tenants, it is time to evict. This can be a daunting experience for many property owners, especially if they do not have systems in place and lawyers on hand to assist with the legal ramifications of eviction.

    • Renovation of occupied properties

Older properties often need to undergo renovation to increase the value of the property, and to upgrade the property in general. This could be something simple such as replacing kitchen counters and cupboards with new and improved fittings or a more involved renovation involving days of labour and construction. Renovating property while there is tenants in the building can be tricky, which is why property managers are ideal when it comes to property renovation – being able to facilitate the process effectively.

Property Management Myths Debunked.

Tarleys Trust 0 comments 22.01.2016

In the world of property management, many myths and misconceptions abound. Many individuals and property owners do not fully understand what the term means, and have many assumptions about the effectiveness and necessity of such a service. Some of the most common misconceptions regarding real estate management include the following:

  • Only the very rich need to consider the need to have their property managed.

This is one of the biggest myths, leading many homeowners within the mid-level real estate to assume that their property does not require management. In reality, any property that you are renting out to tenants requires management – from day to day property maintenance work to tenant management, lease agreements, rent collection and property renovation, each of these things is managed by an outsourced, experienced company rather than having to try and do it all yourself as a landlord.

  • Anyone can manage a property, and you don’t need to outsource to get the job done.

Another common myth, many property owners think that they are able to handle everything themselves, only to end up with huge stress and problems when they realise just how much work goes into the management of a property. Tenant management alone can be a demanding job, and without the right experience and skills, it can be extremely difficult to take on something like this on your own – especially if you have a full-time job in addition to managing your own property.

  • Managing a property is simply a case of managing tenants.

While this is indeed a big part of the management process, tenant management is only one aspect – things like problem call outs to deal with broken geysers, blocked sinks, leaking toilets and other small issues are also covered, as are maintenance tasks, renovations, leases and every other aspect that goes into the running of a property in South Africa that is being rented out.

  • Only local properties can be managed, not overseas properties.

One of the biggest trends in recent years is the investment of overseas property. Many South Africans and other nationalities are looking abroad for properties that they can use as holiday homes for some part of the year, and rent out for the rest of the year. Some homeowners have the misguided assumption that they will be able to handle the rental process from another country – one of the most potentially risky mistakes they could ever make. An overseas property manager is essential to ensure that your property is managed properly, regardless of where it is in the world.

  • Property managers are not worth the costs involved.

By far one of the biggest myths is that the management of property will probably be too expensive, and not worth the costs involved. Even small properties can benefit hugely from management services, and studies have shown that well-managed properties are actually more likely to increase in value on a quicker scale than properties that are not managed or ones that are managed poorly. As things like regular upkeep, renovation and other maintenance is done on a routine basis, the property stays in good condition as tenants come and go, making property management a hugely worthwhile investment on many fronts.

Property Management tips for landlords.

Tarleys Trust 0 comments 22.01.2016

As any landlord knows, property management is seldom as it seems at a glance. Many homeowners who plan to let out their property assume that managing tenants and the property itself will be simple and straightforward, without understanding the huge amount of admin and effort that goes into the management of a property – especially in the case of an apartment block. For new landlords hoping to learn how to effectively manage their property in South Africa, here are a few things to consider when letting out your property to prospective tenants:

  • Finding the right tenant

This is the first and often the trickiest step when managing a property. A company that has experience in dealing with tenants is able to determine what sort of tenant to avoid and which tenants will be the least problematic, while an inexperienced landlord may not know how to approach this without added stress. Things like background checks, references, suitability and other factors all play a huge role in property management, to ensure that you find only the best tenants, who do not have a history of rent payment delays, property damage or other factors.

  • Day to day tenant management

Another huge aspect of the landlord job is dealing with tenants on a regular basis. Landlords may be expected to speak to tenants about rent owing, rent increases, problems in the block, noise complaints, any items that need repair and many other issues that may arise on a daily basis. Having to always be on call can be demanding and extremely stressful to many landlords, especially those who have full-time jobs in addition to managing their property. This is where property companies come in – they are able to deal with the petty issues that arise, leaving landlords free to focus on the bigger issues without having to worry about being bothered throughout the week with small complaints.

  • Property Maintenance and upkeep

Yet another aspect of managing a property in South Africa is the property maintenance and repairs that always arise. Landlords often under-estimate the level of work and patience that this requires, from dealing with the tenant and addressing their queries, all the way through to finding a repairman to fix the problem at stake, and getting the best quote too. Then the landlord needs to liaise with the tenant to ensure that they will be at the premises when the repairman is due – resulting in a huge amount of time and admin.

  • Renovations and property improvements

Aside from repairs and ongoing maintenance of your property, you may also want to consider property renovation as a way to increase the value of your property. For most landlords operating independently, this means obtaining permission from your tenant, and working around their schedule as well as your own schedule to determine what renovations are required, and how to go about getting them done. Without experience in this, it can lead to many sleepless nights – making a property manager a hugely important investment.

  • Rent payments and other issues

How do you go about ensuring that rent is paid on time each month? This is another huge factor when it comes to managing a property, and with many tenants lapsing on payments, it can become a huge chore to keep track of who has paid their rent. This is one of the biggest values of a property management company – they are able to keep track of rent and all other aspects, ensuring that landlords can focus on the profits rather than the day to day stress.

Property Renovation can significantly improve the value of your Property

Tarleys Trust 0 comments 22.01.2016

For homeowners wanting to increase the value of their property, property renovation offers one of the most effectiveasd and simple ways to boost property values – something that in today’s tough property market goes a very long way indeed. How does renovation help exactly however, and is it worth the cost of endless building, fixing and remodelling? Here are three of the biggest reasons to consider the benefits of renovating your property:

  1. Renovated properties sell at a much larger profit than those that have not undergone some sort of revamp. Homes with features such as en-suite bathrooms, modernised kitchens, electric garages and beautifully finished floors are far more in demand than those without, especially in the case of apartments and older buildings.
  2. Renovated properties can also be rented at a much higher rate than un-renovated ones, making this an excellent benefit in terms of property management and investment through letting.
  3. Structural changes such as new floors, new rooms or decks, elevators or other value added changes can significantly increase the property value as well as add to the building’s appeal.

While those that can afford the costs are able to consider huge structural and internal changes across the entire property, the average homeowner will target certain areas within the property for renovation. Property experts advise that even acoat of paint in the right colour can make a difference, with a number of other small to significant changes that can be made to boost a property’s value. These include some of the following:

  • New flooring such as laminate wood, tiling, strip wood or other good quality flooring.
  • Walk-in closets in the master bedroom, as well as en-suite bathroom.
  • Renovated bathroom with updated basin, taps, shower, bath and toilet.
  • Renovated kitchen with extended counter space, island, marble or stone counter tops and updated shelving and storage space.
  • Value-added items such as Jet Master fireplace, light dimmers, updated light fixtures in all rooms, electric fencing and under floor heating.
  • Outdoor areas such as entertainment areas, braai areas, wooden decks or sunrooms.
  • Spa bathrooms with Jacuzzi bath, large shower and relaxation area.

Property experts say that trends should be avoided however, as these may not have the same value in a few years as they may do now. With a bit of planning, thought and inspiration, you will be able to put your renovations into place effectively, ensuring that your property in South Africa increases in value, from a financial and practical point of view. Speak to your property management company to learn more about renovating property.

Buying your first property in South Africa – A ‘How To’ Guide

Tarleys Trust 0 comments 22.01.2016

For first time buyers considering property in South Africa, the process is both hugely exciting, and immensely scary. Knowing how to go about securing a home loan, and what steps, documents and procedures you need to follow in order to buy your dream home can be tricky if you have never taken the plunge before, and with friends and family all adding even more confusion by offering conflicting advice, it can make the entire process something of a nightmare. Before you give up and resign yourself to a lifetime of renting, consider these expert tips from property management service experts:

  • Know your budget and agree on a price limit

Chances are good that you are purchasing property with a wife, husband or long-term partner. Together, you will need to work out your joint budget, and decide how much you can afford to spend on property in South Africa. Much as you may be dreaming of owning that beautiful four story mansion in Constantia, if your income does not allow you to budget sufficiently, you will not be able to secure a home loan. If you choose to go with a joint loan however, you will be able to apply for a greater loan than you would if applying for a single loan – this often amounts to about 25-30% of your joint income in total.

  • Understand the bond process and what it means for you

The minimum amount for a home loan in South Africa is about R100, 000. Another key thing to consider is whether you can afford a deposit towards the loan, as this will affect a number of things, including the interest you may need to pay on your loan. When your loan application is received, the bank will determine the Loan-To-Value ratio (LTV) – this is basically the ratio between the loan you require, and the value of the property in question. The lower the LTV ration, the lower your interest rate will be.

  • Get all your documents and information together

Once you are ready to put together your application, you will need to have the following documentation ready to give to the bank. In the case of joint loans, both parties will need to provide these documents:

  1. Copy of your ID
  2. If you’re full-time employed, three months bank statements
  3. Your offer to purchase
  4. Most recent payslip or in some cases, up to six months payslips.
  5. Self employed business owners will need the following:
  • Six months business accounts statements
  • Six months personal bank statements
  • Proof of monthly income

To qualify for a home loan to purchase property in South Africa, you need to meet certain requirements. You need to be over the age of 21, be employed for at least two years (or self-employed for at least six months) and be earning a minimum of R10,000 joint or single income and have a clear credit history with no defaults or judgements. If you meet these requirements, then you can begin the first steps to purchase your dream property in South Africa.

How the World Cup has changed the Property Market in South Africa

Tarleys Trust 0 comments 22.01.2016

There is no doubt that the FIFA Soccer World Cup has had a huge impact on tourism and South Africa as a whole, but what impact has it had on the property market in terms of foreign investors and real estate evaluation? Experts agree that the World Cup had been hugely successful in terms of foreign investment on the South African real estate market, with the increase in exposure and visitors playing a vital role in the property industry. Property prices are at a premium, especially in the highly sought-after areas across the country such as Sandton, Bishops Court, Camps Bay and other key residential areas. What does this mean for local homeowners seeking to invest in property, and will this influx of investment set a long-term precedent once the World Cup fever has died down?

 

The Times Live recently reported that many celebrities are considering South Africa for property investment, with many estate agents noting an increase in high profile viewers over the month of the World Cup. Coastal properties are especially attractive to celebrities seeking property in South Africa, in particular the high-end suburbs of Cape Town’s Atlantic Seaboard. Other members of the elite and extremely wealthy, such as dignitaries and political figures have also been taking an interest in the country’s property market, with visitors from the UK, US, Italy and France especially interested in owning property in South Africa. Estates such as the exclusive Pezula Estate on the Garden Route have attracted sporting celebrities such as Nick Price, Roger Federer, Jonas Bjorkman and Graeme Smith, while many A-list celebrities have chosen select Cape Town property – sneaking in incognito when they need to escape the crowds.milnerton
It goes without saying the types of properties that appeal to celebrities are far beyond average. Some of the country’s premier real estate can be purchased at anything from R15 million to R100 million and even higher, whether these are towering glass mansions overlooking the Atlantic coastline, picture-perfect apartments in the heart of Sandton or sprawling homesteads in the Constantia green belt. One of the most expensive and exclusive properties on the market includes the spectacular R110 million property in the Waterfront area of Cape Town – situated at the top of The One and Only hotel. Launched by the iconic Sol Kerzner, this penthouse has it all; views, location and the ultimate luxury.

The World Cup and its related success will see property values increasing as the interest and demand among foreign investment grows, giving even more value to property in South Africa. As any property management company can attest, now has never been a better time to invest in this hugely sought-after property market.

Tarleys Property Management has your best interest at heart

Tarleys Trust 0 comments 22.01.2016

We are at the end stages of our various expansion projects, some of which include, bigger offices, additional staff, a revamped website and new partnerships which have been put in place to ensure our clients maximum growth and optimum service at all times.

It seems 2010 has given the much needed injection of excitement and motivation into the industry evidenced by the increased movement in the market which seems to be growing on a monthly basis as the long awaited Soccer World Cup draws closer and closer to a reality.

As most Property Management agencies begin to increase their prices for 2010, our pricing structure will remain as per usual for the foreseeable future as the pockets of South African citizens will be one of the major casualties of the Soccer World Cup. We are doing everything possible to protect the investments of our clients, both short and long term.

Our primary objective is to maintain the wealth of South Africans by not jumping on the 2010 bandwagon of increased prices motivated by the attraction to the abundance of foreign currency which will be flowing through our country this June.

The publication of articles written by both myself and other staff members form the beginning of the new (and hopefully improved) interface of the company, through which we hope you will learn more about us and the team behind our property division.

Why Do I Pay Levies?

Tarleys Trust 0 comments 22.01.2016

In short, levies are payable for the upkeep and general day-to-day running of the common areas. Levies provide the Body Corporate with the funds required to meet monthly expenditure and, in most cases, also allows the Body Corporate to build up a Reserve Fund over time in order that funds are readily available should the Body Corporate need them.

The Reserve Fund is used either in the case of unforeseeable repairs (any items which may need to be repaired) or foreseeable property maintenance (ie. Painting of the building). By having a Reserve Fund, the Body Corporate is ensuring that maintenance or improvements to the building can take place without placing additional financial strain on the owners within the Sectional Scheme.

In order for a Body Corporate to maintain its financial health, Levies need to be received on time on a monthly basis in order for the Body Corporate to meet its monthly commitments in terms of expenditure.

Although many owners do not see the necessity of making monthly levy payments on time, it is very important that levies are paid on time monthly for the Body Corporate to function properly.

I hope you find this new section informative and look forward to receiving your questions for the next edition.

Yours faithfully

 

Ashleigh Strydom

Portfolio Manager

Who must maintain the window frames of my property?

Tarleys Trust 0 comments 22.01.2016

Section 5(4) of the Act provides that the common boundary between any section and another section or common property shall be the median line of the dividing floor, wall or ceiling, as the case may be.

If the frames are flush with the exterior surface of the wall, they are likely to be entirely common property.

If they are flush with the interior surface of such walls, they are likely to form part of the sections.

The third possibility is that the width of each frame extends on both sides of the median line or mid-point of the exterior wall. In this case the frames will be partially common property (the exterior portion of the frame) and the balance of the frame will form part of a section.

If the window frame forms part of a section, the unit owner bares the responsibility of maintaining the window frames. In terms of section 44(1)(c) of the Act each owner is obliged to repair and maintain his section in a state of good repair. Thus the body corporate has no primary responsibility in regard to maintenance of the window frames where they form part of sections.

Prescribed Management Rule 68(1)(iv) provides that an owner shall not do anything to his section or exclusive use area that is likely to prejudice the harmonious appearance of the building. Accordingly any owner who wishes to replace a window frame which forms part of this section and which is visible from the exterior of the building should first obtain the consent of the trustees.

If the window frames are entirely or partially common property. We can deal with these two possible cases together because where a part of the frame is common property it must inevitably be that part which is exposed to the elements.

If the window frames are entirely or partially common property the body corporate is responsible for their maintenance. Section 37(1)(j) of the Act provide that the body corporate is obliged properly to maintain the common property and to keep it in a state of good and serviceable repair. In these circumstances the body corporate clearly cannot require individual owners to pay the cost of replacement of the window frames.

In practice, it is most common found that in maintaining or replacing window frames, the Body Corporate and section owners usually share the costs for maintenance or replacement.

Yours faithfully

 

Ashleigh Strydom

Portfolio Manager

3 Huge Benefits of Outsourcing Property Management Services

Tarleys Trust 0 comments 22.01.2016

Whether you own a small apartment or large premises, property management will be able to save you a fortune in expenses as well as stress. Despite the fact that many property owners think that they can handle all aspects of managing a property without the help of experts, it is all too often much more difficult than it appears, and to ensure effective management of resources, property owners need to be careful about hiring inept fly by night companies who are not equipped to manage properties. A recent news story about South African Police Commissioner Bheki Cele and his mismanaged team of property managers has brought home the importance of ethical and accountable management – regardless of the size or nature of the property. The SAPS has come under a lot of fire for allegations of mismanaged funds, which are reportedly in the region of nearly R7 million.

While the SAPS answer to the powers that be on the use of the allocated funds, property owners can consider the following benefits of hiring a trusted company to manage their property effectively:

•Residential properties are able to extend their life-span considerably

Residential apartments, especially those that date back to the 1970’s and thereabouts, are able to stay maintained and well-kept with proper property maintenance and management. From simple things such as replacement of floors, taps or windows, to full renovation and restoration of older flats, properties are able to get a new lease on life, making them solid investments that will attract tenants year after year. With so many new apartments on the market, older apartments are often bypassed for trendier properties – however with regular renovation and upkeep, older blocks are able to continue keeping up on the highly competitive property rentals market.

•Disputes and other admin tasks are handled effectively

Property owners no longer have to deal with ongoing disputes about rent increases, leases and deposits, as management companies are able to deal with all admin and related issues on the owner’s behalf, from concerns about property development to any other issues that may arise. Many landlords have full-time jobs in addition to managing their property, and face endless problems dealing with tenants at all hours of the day – something which eventually leads to service levels dropping as issues build up. A good indication of a reputable management company is the way that they handle disputes and the effectiveness of their operations. With the right management company, not only will property owners cut down on the amount of concerns that they need to deal with, but future disputes will be minimised with proper management solutions and services that are provided by the outsourced company.

•Property experts will be able to save you on costs

Many landlords avoid hiring property management companies as they are concerned about forking out to pay for management services. In the long run however, these companies can actually help save costs – with excellent contacts on repair services, and admin kept up to date, things run a lot more smoothly, minimising on wasted time and keeping costs down by carefully managing funds. Many management companies are also able to negotiate discounts with bulk wholesalers, to help you save even more on contracting costs and supplies for renovations.

For fuss-free operations and quality service, property management companies offer a highly beneficial way for property owners to manage their properties easily and simply.