Managing your property

After you chosen your dream home in the sun and arranged the finances to seal the deal, one the final meetings you are likely to have before you return to the UK will probably be with prospective property management companies (PMC). Whether you are intending to keep the home for your own personal use only or whether to rent it out commercially, it WILL need to be managed. We can supply you with a list of companies who we recommend and have worked with successfully with our buyers in the past, or you are free to choose any company you wish, perhaps from a referral from another owner. It’s a good idea to interview two or three before you make a final decision. Remember the management company you choose will be working for you. You should therefore conduct this meeting like a job interview – and you are the employer. Don’t be afraid to ask difficult questions. Ideally, you will need to select a property management company before you take possession.

You need to ensure that a reputable PMC is organised and ready to take over the property immediately after closing (completion in the UK).

Immediately after closing, they will need to;

· Collect the keys and probably re-key the locks for you

· Arrange for the utilities to be switched to your name – deposits may be needed

· Clean and repair as necessary

Try to find time to check several out on the internet before you get here, or preferably by visiting them and meeting them whilst you are here. Many of them are British owned and all will offer you a friendly reception when you visit.

A list follows showing some of the services provided by property management companies:

· Regularly mowing your lawn and looking after your garden

· Weekly swimming pool maintenance, including washing the deck and pool furniture

· Maid service, particularly after guests have vacated the house

· Laundry

· Property Maintenance

· Pest control

· Arranging bookings on your behalf ( see note on “Websites”, below )

· Looking after and handing out keys ( to guests )

· Collecting fees and rent

· Paying utility bills (although many owner do this themselves with online banking)

· Emergency callouts – e.g., when a guest locks himself out!

These are just a few examples. There are many property management companies to choose from. Prices charged vary and it is always wise to shop around to find the deal that suits you best. Many offer a menu arrangement, where you can pick and choose only the services you need.

State Law requires that your home is fully licensed if it is to be used as a vacation home.

Your management company will ensure that your license is in place and that the property is inspected and passed as public lodging establishment. The inspector will ensure that you have the necessary fire extinguishers, smoke detectors, pool alarms and emergency lighting required by law in a small hotel. To set up the license and have the property inspected will probably cost around $200-$275. This is a one-off setting up charge.

In addition to this, your property management company will ask you for a float of perhaps $1,000-$2,000 which they will hold on your behalf in an “escrow” account.

This will initially be used for paying your utility bills, repairs and maintenance costs.They will then send you a monthly account detailing these.

In addition to the actual utility payments every month, you PMC will typically charge a fee of $250-$300 per month for the services listed above, with the exception of cleaning.

Usually a clean is only arranged when a guest has left, typically twice a month. The cost is usually around $75.00 each time a cleaner is called in. The cleaner should also check to make sure there are no breakages and nothing is missing from your property.

You should also be expected to pay for a ‘spring clean’ twice a year, which should include steam cleaning carpets, power-washing the pool deck and touching up the paintwork, etc. This is very important in order to keep the house fresh and appealing to your guests.

Each guest will normally be charged a security bond before they arrive and this will only be returned once the PMC knows the property has been left in a fit and proper state. This can be collected either by the owner or the management company, in advance of the booking.

Will the management company fill my house with bookings?

If you are renting the property out as a vacation home, the PMC should be able to help you find some guests to fill your diary. If the property was a rental previously, it may already come with bookings arranged by the previous owner. Alternatively, the bookings may have been made by the previous property management company.

In such a situation, you really need to talk to the existing management company as well as maybe 2 or 3 others, as keeping the previous company in place, at least for a limited period of time, should ensure these bookings remain with you.

Some management companies will help you with bookings, others simply manage the property for you.

We stress that management companies are there to manage. If you just assume they will handle the bookings as well and you don't need to bother, think again. Most investors realise that they are not going to get rich from bookings, but many think that the villa will run itself - NOT TRUE!

Like all the big hotels and all the thousands of small ones that are your direct competition, you have to work really hard just to break even. You cannot rely on management companies to run your business for you - without being unkind, they are just your book-keeping, cleaning and maintenance team.

Ultimately though, you are responsible for appointing a company that you believe will work with you and take away the worries of ownership from half-way around the world.

One final tip!

If you don't have one already, invest in a fax machine. It will make running your property abroad much easier.