Rental Managemnt - Our Philosophy
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Facility care and management is an essential part of keeping value of a property investment.
Choosing the right tenants is part of this. Keeping ones knowledge up to date regarding rental laws and changes and court judgements consumes time also, but is important. Having the right craftsmen at hand when something needs to be fixed or renovated in an apartment, who are reliable and not overly expensive, is another vital point. Not giving up when things become difficult has to be in the blood and nerves of a property manager. Since 15 years now we have serviced our international investors and never had any serious problems within the business relationsships to them.
Problems concerning buildings, tenants and market situations (like the financial crisis 2008, the Euro crisis 2015 etc.) are outside of our influence, but we do all we can to keep the focus of our service targetted to make the best out of such situations and amongst all, to care that the actual values of the properties are not affected if in any way possible. Our Know-how and advices to investors are based on a long experience and have undergone certain learning and improvement processes as is natural in the course of life. None of the investors apartments have been seriously affected by any of the crisis above.
As a comment on yields: Investors of course and understandably expect the best of all yields. There is one very basic law: The higher the yield, the higher the risk. Frankfurt, the City of the Euro and the biggest international airport in Europe after Heathrow, is a low-yield low-risk city when it comes to renting markets. Average yields nowadays are between 2 and 3 % for apartment rentals in Frankfurt. With bank interest rates below 1% this is still considered a better investment than to hold the money in banks. Not to speak of currencies and other turbulences.
German mentality in regards to property investments was always that they should be safe, not high-yield. In the end, the value increases in low-yield areas are compensating for this at the point of sale.
Much of the adjustment of the final yields is in the hands of the facility manager. Part of this is the reliability of tenants who pay on time; the cost-ratio of repairs and companies who are ordered to do such, and an honest, on the ball building manager who needs to be as good and reliable as the rental manager in his efforts to keep the commonly owned building and premises in good shape and order.