Rental properties are one of the cool ways to make money in real estate in Nigeria especially if you need regular cash flow. Many aspiring landlords in Nigeria feel that owning a rental property is a dream come true yet underestimate the challenges that come with having tenants.
A lot of landlords prefer handling the management of the property themselves, interview tenants, collect rent, supervise maintenance issues, resolve a dispute among tenants, handle eviction processes and several other property management issues. The latter realise property management is time-consuming and can be stressful. There are ways to reduce the stress of property management and that is hiring a property manager or a property management company.
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If you like having the best of everything then you’ll also want to hire the best property management team you can find in Nigeria. You need to take your time in selecting the right company for your property and also try not to fall into the hands of dubious companies in Nigeria. If you want your property to survive, ask the property management company the following questions before hiring them.
1. How long have you been in business for?
The number of years the property management company has been in business doesn’t necessarily matter but the experience is a plus. The more experience they have the better they should be able to handle any situation.
2. How many properties do you manage and how many employees do you have?
A number of property management companies in Nigeria are understaffed and you won’t want one employee managing 100 tenants. The question will give you an idea how big the company is and the employee/doo ratio gives you an idea the kind of service you’ll be getting.
3. What type of properties do you manage?
You have to make sure the property manager has experience with the type of property you have. You can’t have a property management company handle a luxury building with no experience of how to or understand what is expected in the job.
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4. When will you need to communicate with me?
Find out when you can expect to be contacted by the company. Is it for repairs? Questions from tenants? Status updates? Anything?
5. What are your management fees?
In Nigeria, the standard management fee is 10% of the monthly rent. If the property management company decides to charge more or less, you need to find out why.
6. Do you have any extra fees?
Some property managers in Nigeria, charge fees and markups on repairs, marketing, account setup and others. Find out ALL the fees they have.
7. How do you handle late rent payments?
The rent is the lifeblood of your investment so you need to know how the firm plans to handle late rent payments. Some companies in Nigeria allow a grace period for late payments and some might enforce a more advanced rent collection tactics. You need to realise that keeping your money flowing into your property without a high tenant turnover is the key to success.
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8. How are repairs and maintenance handled?
You need to know if the property management company works with a private team of contractors, how they plan to handle repair and maintenance of your building. Repairs and upgrades are essential to keeping your property strong on the rental market.
9. Can I cancel my contract with you if I am unsatisfied?
Some management companies in Nigeria might try to keep you locked in long contracts but you should be able to say YOU’RE FIRED if you seem unsatisfied with the services.
10. How do you determine market value?
Ask how the company determines the rent value of your property. They should be able to provide proof that the projected rent values coincide with the market. You can even do your own research to confirm the rent prices match to similar homes in the same vicinity. If the numbers don’t match, take this as a red flag.