Spanish property prices are rising, particularly in large cities, and many overseas investors are snapping up properties to rent them. Needless to say, renting a property is not always without problems, and if the owner is abroad, he will need to have someone local to help make sure all aspects of running the property are maintained in a timely fashion. This is where property management companies come in.
So, what exactly will a property management company do?
A company that offers property management services in Spain will look after all aspects of maintaining a property, from marketing your rental and finding you tenants to checking references, collecting the rent money, and making sure you receive it. They can also respond in a timely fashion if something should break down, need an emergency repair, and even help evict a tenant where necessary. These are necessary services that would be difficult for an owner living abroad to deal with.
Do I need to employ a property manager?
No, the property manager holds the status of being an independent contractor, so you do not have through the hassles of legally employing them.
Should every overseas owner use a property management company?
Ideally speaking, yes, as it will save you precious time and solve a lot of problems. However, there are costs involved with using property management firms, and you will need to weigh that up against the rental income you will earn on the property.
It will also depend on how many apartments or villas you are renting out. The more units you have, the more likely there will be issues, and owners of multiple flats will benefit substantially from employing a management services company.
If you live overseas and have little opportunity or reason to visit Spain, you will probably find it vital to use a management firm’s services. Even dealing with small issues can be a huge hassle if you are not on-site.
With such high property prices in the cities, if you can afford to buy a property for rental purposes, it is likely to run a successful business that will take up quite a bit of your time. In this case, hiring a company to deal with the day-to-day issues that inevitably arise when you own property makes perfect sense. It is much more logical to devote your time to building your already lucrative business and offload the management work to others.
There is also the factor that property management may not be something you would enjoy, and therefore you will probably not be very good at it. Some people like to meet prospective tenants, check out references, etc., while others find this a tedious task. If you fall into the second group, management services will be the way to go.
When you consider how much easier life is for overseas landlords when deciding to use a property management firm, the small monthly fee, which usually works out to be around 10% of total rental, is not extortionate. A price most people will be more than willing to pay for the peace of mind this service provides.