Rental management, condominium management, condominium administrator, property management, special property management – these terms are often used synonymously and can easily be confused. So, what does rental management actually do? And which form of management is right for property owners and condominiums? This article sheds some light on the differences.
The right form of management makes the difference: rental management and other optionsLink to this section
Professional property management and support is extremely important for owners and requires specific skills and a high level of commitment. When it comes to managing apartment buildings or residential units in larger properties, a suitable management model must be found. Two types of management emerge: rental management and condominium management, or property management.
Why the right form of administration is so important
The choice between rental management and condominium management or property management has far-reaching consequences for property owners. A deeper understanding of these management options is important for you as an owner and your property in order to:
To correctly fulfill your legal obligationsTo optimally manage financial aspectsTo fully exploit the potential of your property
Definition: This is what a rental management doesLink to this section
Rental management is a comprehensive service for property owners and handles the rental management of individual rented residential units in multi-family homes, single-family homes, or residential complexes. Rental management is also responsible for tenant support.
As the landlord's representative, the rental manager acts as a central interface to various parties, including tenants and service providers. The rental manager not only works reactively but also actively pursues the landlord's goals and interests.
The tasks of rental managers go beyond the mere management of rented residential units and include:
Administrative tasksLegal mattersTechnical aspects
The exact scope of services is defined in an individual management contract and can be flexibly adapted to the needs of each unit. As landlords, tenants retain the option to provide certain services themselves as desired.
Legal framework of rental management simply explainedLink to this section
German tenancy law, enshrined in Sections 535-597 of the German Civil Code (BGB), forms the foundation for residential leasing. These regulations regulate in detail the rights and obligations of landlords and tenants.
Although there is no legal obligation to engage a rental management company, doing so can contribute significantly to compliance with legal regulations and to increasing the value of apartments and real estate.
Key aspects of tenancy law briefly summarized
The BGB focuses on the following key areas:
Protection of property rightsLegal basis for rental agreementsRegulations on rent increasesRequirements for the condition of the living spaceApproaches to solving typical conflict situations
A professional rental management company can therefore efficiently handle the complex and time-consuming aspects of renting apartments. It relieves landlords of their burden and ensures that all legal, administrative, and technical requirements for each unit are expertly met.
Legal tasks of rental managementLink to this section
Through the following legal competencies, rental managers significantly relieve the burden on landlords and ensure legally compliant management of residential and rental properties.
Rental management companies act as legal representatives for landlords and provide the following services:
Coordination and conclusion of service contractsReminders in case of late payment by tenants
Legal disputes are increasingly becoming part of the responsibilities of rental management:
Representation in court proceedings (with explicit power of attorney)Handling of claims regarding: outstanding payments from tenants, evictions in the building, claims for damagesCommissioning and communication with lawyersEnforcement of owners' rights in court
Professional rental management is of course also characterized by:
Continuous updating of legal expertiseCompetent handling of rent increases within the legal frameworkProactive intervention in legal challenges
Administrative tasks of rental managementLink to this section
Competent rental managers also take care of comprehensive administrative tasks.
They advertise vacant residential units and are responsible for organizing and conducting viewings with potential tenants. Once a tenancy is established, the rental management team takes care of drafting and concluding rental agreements.
Another important aspect is the implementation of legally compliant rent increases in order to adjust the rent to the current market situation and increase the profitability of the property.
Rental management includes monitoring and recording rent receipts to ensure a clear overview of the financial situation of the rental properties. Rental management also includes processing rent reduction applications, reviewing the legitimacy and extent of the rent reduction to avoid legal disputes.
Payment transactions involve settling bills from utility companies and service providers to ensure the supply of the property and to fulfill contractual obligations.
The preparation of operating cost statements is also an essential part of payment transactions in order to present the costs to the tenant in a transparent and comprehensible manner.
Issuing reminders in the event of arrears to request payment from tenants and, if necessary, initiating further action is also a task of rental management companies. If payments are not made, legal action is initiated to enforce the landlord's claims.
The rental management department is generally available to tenants as a point of contact for questions and conflicts, helping to find quick and efficient solutions. For example, for insurance and damage claims, the department is the first point of contact for reporting the damage and coordinating the next steps.
Technical tasks of rental managementLink to this section
The rental management team conducts regular property inspections to assess the condition of the property. This includes checking the functionality of the technical equipment to identify potential problems early on.
The rental management department is the first point of contact for tenants in case of technical problems and receives damage reports. It assesses and prioritizes repair needs in order to initiate necessary measures as quickly as possible.
The rental management also informs landlords about necessary work and obtains their approval. They then organize and monitor repairs and maintenance to ensure that the work is carried out professionally and on time.
The rental management team oversees service providers such as caretakers, cleaners, and gardeners. They monitor the quality of external services to ensure that the property is always well-maintained.
The rental management team conducts apartment viewings with potential tenants and manages the keys for the rental properties. Upon move-in and move-out, they prepare handover reports documenting the condition of the apartment. These reports are archived for future reference.
When does rental management make sense?Link to this section
Opting for professional rental management makes sense when the size of the property portfolio places a heavy burden on the owner, as managing multiple rental properties increases the administrative burden considerably and rental management can save time and resources.
Rental management is also advisable if the owner's time is limited, as limited availability or geographical distance make self-management difficult and rental management can take on time-consuming tasks and ensure constant presence.
A lack of professional expertise in legal matters, accounting, and the rental market can also be an argument in favor of rental management, as professional managers minimize legal risks and optimize returns.
For complex properties, such as commercial properties or mixed-use projects that require specific expertise, rental management companies often offer specialized services.
Tip: Conduct a cost-benefit analysis comparing the costs of self-management with those of professional rental management. Consider potential savings and efficiency gains from the expertise of a rental management company.
Ultimately, the decision for or against rental management should be based on a careful analysis of your individual situation. In many cases, outsourcing to experts not only saves time and stress but also increases the profitability of your real estate investment.
Rental management, condominium management and special property management (SEV): The differenceLink to this section
Rental management
focus: Support and management of individual residential units (rental apartments) on behalf of the owners.Tasks: Tenant search, rental agreement conclusion, rent collection, utility bill accounting, maintenance of the residential unit, communication with tenants.
WEG administration
focus: Management of the common property and common interests of a condominium association.Tasks: Organization of the WEG, holding of owners' meetings, preparation of business plans, maintenance of the common property, representation of the WEG externally.
Special Property Management (SEV)
focus: Management of the special property (condominium) within a condominium association on behalf of the individual apartment owners.Tasks: Similar to rental management, but taking into account the specifics of condominium law and the community regulations of the condominium association. Often handled by the condominium association management.
Overview: the difference summarized
Rental management vs. SEVWhile the rental management takes care of the needs of an individual rental apartment, the SEV also observes the rules and obligations within a condominium association.WEG administration vs. SEVThe WEG administration takes care of the management of the common property, while the SEV represents the interests of the individual apartment owner in his/her apartment.
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The tasks of the WEG administration and property managersLink to this section
Sections 27 and 28 of the WEG define the basic scope of duties of the WEG administration. This can be extended or adapted by a stipulation in the Declaration of division or resolutions of the homeowners' association. The specific rights and responsibilities of the property management company are laid out in the management contract. This contract regulates, among other things, specific responsibilities and tasks, the amount of property management costs, and any additional services that may be charged.
Organization of the owners' meeting
One of the most important tasks of the property management company is conducting the annual owners' meeting. This must be held at least once a year, and all owners must be personally invited. The condominium management company is responsible for the preparation and follow-up of the meeting, which includes convening, chairing, and taking minutes, as well as recording new resolutions for the record of resolutions.
Administrative and legal tasks of the WEG administration
In addition to organizing the condominium owners' meeting, the condominium management team also monitors all incoming and outgoing payments for the condominium association. This includes setting up and maintaining bank accounts for the condominium association. The property management team may also represent the condominium association in debt collection proceedings.
Within the scope of accounting, the property management is responsible for preparing the annual financial statements and the annual asset report. economic plan for the coming year, which includes suggestions for cost savings. In addition to the current budget, property managers also plan the necessary hiring Maintenance reserve This is used to manage larger investments, such as modernizations or renovations of shared property.
The property management company can also suggest maintenance or modernization work. A professional property management company is fully informed about innovations and legislative changes and can therefore provide comprehensive advice to the condominium association.
In the event of legal disputes requiring support, property managers organize collaboration with legal counsel and handle communication. Furthermore, the property management company can represent the condominium association as a contact and contractual partner with third parties, such as the janitorial service or garbage collection.
The property management company, as representative of the condominium association, may terminate existing service contracts or conclude new ones in consultation with the condominium association advisory board or following a vote at the condominium association general meeting.
Technical tasks of property management
The technical tasks of property management generally include monitoring the condition of the property and assigning work orders for its maintenance and improvement. A modern property management company can also provide owners with comprehensive advice on important topics such as maintaining and increasing the value of the property.
The property management company is obligated to conduct regular inspections of the common property. During these inspections, the manager assesses the structural and technical condition of the property, such as stairwells, elevators, basements, heating, and satellite systems. Compliance with legal requirements, such as organizing winter maintenance, also falls within the scope of technical responsibilities.
Following the inspection, the property management company contacts the condominium association with the findings and suggestions for further action regarding any necessary repairs. Once the condominium association has decided on the necessary measures, the property management company commissions the appropriate service providers and monitors their implementation.
As you can see, the technical support provided by a property management company can be quite extensive. The exact services are specified in detail in the respective management contract, depending on your needs.
Tips for choosing a suitable property management company: What is importantLink to this section
Whether you're looking for rental management or property management, choosing the right management company is crucial to the success and value retention of your property. Regardless of the type of management, there are key aspects you should consider.
Professional competence
Sound knowledge of the Condominium Act ( WEG Act ) are essential for making legally sound decisions and representing the interests of the owners. Professional management of legal and financial matters, such as preparing annual financial statements and conducting owners' meetings, is also important for you.
Communication and transparency
A good property management company will regularly and comprehensively inform you, as the owner, about all relevant developments in the property, such as upcoming repairs, maintenance measures, or changes to the house rules. Finances and decision-making processes should be presented clearly and comprehensibly to ensure transparency.
Efficiency and responsiveness
When it comes to maintenance and repairs, quick problem resolution is essential to avoid unnecessary delays and costs. An established network of reliable service providers, such as tradespeople or caretakers, is particularly advantageous here, ensuring your condominium association receives high-quality services at fair prices.
reputation
Positive references from other property owners' associations and proven experience in long-term partnerships with owners and service providers are always important indicators of a trustworthy and reliable rental and property management company.
Do you already know Ralph?
Ralph offers you transparent, efficient, and cost-effective solutions. Rely on our expertise for worry-free and transparent management of your condominium. Do you have questions about management fees, property management costs, rental management services, or other areas related to managing your rental property? We are happy to help! Contact us now and request a quote. a free offer We look forward to seeing you!
