Why estate surveyor and valuer should manage property investments

Investing in the property market, especially for residential, office or shopping with the aim of earning regular income thereafter is not as straightforward as we do for bonds, shares, stocks, bank savings or deposits. In fact, it is just a little different from going into direct manufacturing or agricultural production. To make property investment sustainable, productive and indeed worthwhile, specialised management expertise is required.

Unfortunately, not everyone appreciates this fact, hence the preponderance of owner-management or the resort to ‘caretakers’ in several Nigerian towns and cities. While managing own property investments could be wise and economically prudent, how many of these owners possess the time and expertise for the management of property investments? Truth be told, an investment in real estate asset (or our generic property asset) is a journey into the bundle of physical, economic, social, legal and statutory complexities.

Investment in property assets have several attendant issues that would not readily come up with bonds and stocks or shares – regular screening and choice of occupants, monitoring the use and handling, drawing up and executing appropriate lease or tenancy agreements, maintaining peaceful co-existence among occupants and with adjoining users, actively pursuing the receipt of income, attending to repairs and maintenance (both foreseeable and non-foreseeable), resolving disputes, managing voids and vacancies, payment of taxes and levies, prosecution of lapses, ensuring compliance with statutory requirements and demands, purchase and maintenance of insurance coverage etc.

Unfortunately, these and many more responsibilities of managing multi-million investments in property assets are what some people entrust into the hands of non-professional managers and corner-side ‘caretakers’.

Take sourcing for and screening potential tenants as an example. Property owners often have their other regular duties, which hinder them from devoting sufficient time and efforts into sourcing for and properly vetting prospective tenants. Invariably, they may end up with difficult tenants who do not pay rent as at when due, cause property damage, or create problems with other residents.

Rather, a dedicated property management company with knowledgeable and experienced staff would readily undertake these tasks, as of routine. Such qualified and professional real estate management companies do have standard procedures that include thorough background checks and other screening requirements.

When it comes to property maintenance, a multi-million naira fabric requires competent and experienced maintenance service providers which are more easily procured (and cheaply too), through established professional property company from their list of performing and efficient service providers.

The company can operate planned and preventive maintenance culture, including advising property owners on the need to keep minimal and revolving retention on account to fund possible unforeseeable damages from rainstorm, collapsed septic tanks, failing inspection chambers etc. As financial experts with proven accountability and ethical standing, the professional property company does not usually find it difficult to convince their clients (property owners) on this.

Also, we must realise that the professional property managers often operate as real estate brokers and valuers. Thus, as property market players, they are abreast with the trends to be tracked in their advisory to the property owners, rather than the turn-key and haphazard approaches common with the non-professionals. In other words, the property investor would be assured of receiving the best income accruable to his investment under different economic frameworks.

Besides, a qualified property management company knows how to protect his client (the investor) from costly lawsuits and liabilities. For instance, a lot of property owners are not up-to-date with federal, state, and local laws regulating property rentals, property/facility maintenance, insurance, fair housing discrimination, dispute resolution, grounds for and procedure for determining tenancies and/or leases, tax-avoidance strategies etc. Running afoul of any of the provisions of any such subtle legislations could result in enormous losses and investment setbacks.

Even much more paradoxical is the fact that qualified real estate/property management companies tend to charge fees that are much lower than that of the quacks and corner-side caretakers. This is because their fees are regulated by the government through their professional associations. They also perform their duties with a lot of ethical and moral responsibilities, being accountable to several outlets. It is therefore rare to witness instances of extortion, fraud or ‘bolting-away’, some of the vices common with foot-loose non-professional firms and caretakers.

Investing in property is a major economic decision which can also be financially rewarding. All property investors want to succeed as much as possible but not everyone has the wherewithal and the expertise to appropriately manage a property into success.

Hence, as a property investor, you must consider hiring one of the qualified property management companies which can be identified by their use of the logo of the Nigerian Institution of Estate Surveyors and Valuers (NIESV). The commission payable for their services would prove worthy as you will often succeed in optimising all the benefits of an efficient property management.
Oshiobugie is a Lagos-based Estate Surveyor and Valuer.