Real estate is possibly the most popular investment vehicle if you are a non-resident Indian (NRI). But since it is an investment, the property needs looking after as you, the owner, are far away in your country of residence.
You may visit once a year but you find that this brief visit is simply not enough to deal with real estate issues such as maintenance, renting, utility bills and property taxes.
You must have wished that the professional property management firms you see working so well in the developed countries could set up shop in India as well. Your wishes seem to be coming true if recent trends are any indication.
There are a host of property management firms that have set up shop in the country and offer a variety of services. Here's a look at who they are, what are the services that they provide and what are the costs involved.
Services available and providers
These companies provide services such as supervising repair works, housekeeping, visiting property for inspections and also coordinating property tax payments, updating legal documents and so on. Along with this they will send you pictures of your property on periodic basis.
Take the case of Bangalore-based Homewell Developers Pvt Ltd. You'll need to pay an annual membership of Rs. 30,000 per flat, no matter how big, to Homewell. This Rs. 30,000 gets you services for a year including housekeeping, paying of bills, pest control, painting, and plumbing and so on. Along with this, you will have to pay the vendors for the costs that they incur, such as employee costs and costs of equipment.
The property management firms have tied up with vendors (those that will do work such as cleaning, plumbing and so on) who provide these various services. So you can either pay this amount to the property management company (via cheques) or even pay it directly to vendors.
Chennai Property Management, another firm offering the service, charges a minimum yearly fee (for a 2 bedroom-hall-kitchen apartment with monthly housekeeping and paying of monthly utility bills and taxes) of Rs. 17,000. Along with this, you will have to pay the vendors that carry out the services. For instance, you will have to shell out Rs. 700 for a cleaning session (Rs 600 which is the fee for the worker who can be a cleaner and Rs. 100 for food and the travel of that person).
Aukeva Inc, a San Francisco- and Delhi-based property management firm will charge you a yearly fee of between Rs. 10,000 and Rs. 2 lakh along with the actuals. The charge will depend on the size, location and the services that you avail. The charges will also depend on the location, size of the property and the bouquet of services that the customer will choose.
The second entity that can help you is your own developer. However, not all developers have an in-house property management firm. What they do is point you in the direction of a fee-for service provider not linked to the builder or can take over the task of the service. "We provide help in getting residents in touch with such firms and for this we do not charge anything," said R Karthik, chief marketing officer, Lodha Group. Godrej Properties Ltd, though, do not offer property management services, they can guide to the firms that offer these services.
Others such as the Kerala-based developer Abad Properties has a separate property management division. A spokesperson for the company said that they offer these services especially for NRIs. These services are not just available for their clients, but those who own properties with other developers as well as those with independent villas. They offer housekeeping services and you can choose to get it done weekly, monthly or even just right before you come for your visit. For instance, if you want monthly housekeeping service for your three bedroom-hall-kitchen set, Abad will charge you a fee of Rs. 1,000 a month. And for a villa, they will charge you Rs. 2,000. For services such as repair work or cleaning of swimming pools, you will have to pay Abad the employee cost along with the cost of equipment and an additional 10-15% of this total amount. Another developer that offers property management is Prestige Estate Projects Ltd.
When you enlist for these services, you'll need an identity proof that shows that you own the property (it could be a sales deed). "You will then have to sign a service agreement with the property management firm. You will also have to give us a set of keys of the property," said Radhika Bahadur, founder, Aukeva Inc.
You needn't have to meet the property management firm in person or even send a power of attorney. The agreement can be signed via email as well, said Bahadur.
Since property management companies help you in paying property taxes, the property tax papers is something that they will require. You will also have to introduce the property managers to your society's association president.
However, keep in mind to avail services of a trusted property management firm as there are many smaller firms that provide these services.
Do your groundwork before enlisting their services. Ask these firms if they can give you contact details of their existing clients to get a feedback of the quality of services.