With continued migration of residents both within the country and abroad, investors in real estate have constantly found it difficult to manage their properties during their absence. There were few options except to rely on relatives or friends for such needs.
But times are changing, especially with India liberalising investment norms by foreign companies. One area that has caught the attention of the foreign companies involved in property management is the huge potential available at metros and secondary towns.
The property management wing of the real estate sector is growing very fast in India. Property managers provide a range of services to property owners including property maintenance, renting, renovating, and security of a residential or commercial property.
A property manager liaisons with owners, tenants and contractors to make the owning/renting process seamless and generate highest possible return for property owners.
The main factors responsible for leading the booming growth of property management services in India includes the following:
One stop solution for property owners
Only owning a property is not enough to earn a good rental income. Instead you need proper management and care of the property. A property owner needs to refurbish the property in case of damages, look for a good tenant when property is vacant, ensure safety of property and fulfill all dues, including pay bills and taxes on time.
All these tasks are taken care of by property management firms on behalf of a property owner on very nominal charges.
Property management firms deal with the tenant and help in completing all legal documents including police verification and rent agreement.
They collect rent, pay the bills and taxes and keep track of each and every important thing associated with the property.
Increasing demand for residential real estate
There might be several disruptions in the growth of real estate sector in India but the fact is that growing middle-class needs houses. According to one estimate, approximately 60 crore people in India would be living in cities by 2030. These numbers speak of the kind of demand we are going to see in the residential real estate market.
As more and more people move into cities demanding houses, the demand for property management services is bound to go up.
Currently, this trend is visible in various metropolitan cities where the property owner doesn’t have time to look after properties due to other important obligations. Such people take the services of property management firms like Propdial.
In India, the real estate sector is the second largest employer after agriculture and is slated to grow at 30 per cent over the next decade. It comprises four sub sectors – housing, retail, hospitality, and commercial.
The growth of this sector is well complemented by the growth of the corporate environment and the demand for office space, as well as urban and semi-urban accommodations.
The Indian real estate sector has witnessed high growth in recent times with demand for office and residential spaces booming. Property management services have also grown rapidly in the last few years.
The property manager is the owner’s partner in maximising the return on investment. Management companies deal directly with prospects and tenants, saving you time and worry over marketing rentals, collecting rent, handling maintenance and repair issues, responding to tenant complaints, and even pursuing evictions.
Many real estate professionals have looked at property management and changed their minds when the scope of the management tasks and record keeping are fully understood.
Although hiring a property management company has many advantages, using one can be expensive. Apart from the cost, relying on a property management company is not for everyone.
There are an estimated 30 million NRIs living in 130 countries around the world. Even PIOs are keen to invest in the growing opportunities available in Indian real estate market.
But doubts linger about land grabbers, tenants not vacating the premises and inadequate manpower to maintain the property back home.
Remittances continue to rise in India, from $49.6 billion in 2009 to $55 billion in 2010. Overseas Indians are keen to look at investment opportunities in real estate. (The writer is the founder of Propdial)