Dubai is a tax haven and a land of opportunities, especially for real estate investors. 2022 was the best year for the property market as the country saw a significant increase in real estate investment from foreigners. Over 97,000 property transactions were recorded in Dubai in 2022 and the trend is likely to continue into 2023 as well. The boom in Dubai property market has also led to an increase in Property management services.
People invest in the Dubai real estate market for various purposes some purchase it for themselves, and others keep it for investment purposes. When someone purchases a property for investment purposes, they need to maintain it and ensure that the property is rented on time to maximize rental returns. This is where Property management services come in.
If you have a property in Dubai and are looking for property management services, this blog will explain to you everything that you need to know including, what property management entails, the laws, and the charges involved.
What does Property Management Entail?
Property management in Dubai refers to the professional management of real estate and financial management. It is a beneficial service for property owners who want to maximize the value of their real estate investment and minimize their involvement in day-to-day operations.
If you hand over your property to a property management company, it will charge you a small fee for handling all operations of the property, such as collecting rent, responding to maintenance requests, managing tenants, and tackling any legal issues that may arise. Property managers also oversee property renovations and upgrades, as well as marketing and advertising efforts to attract new tenants or buyers.
Property Management Services
Now that you are aware of what property management is all about, here are the services that you can expect from your property manager.
- Tenant Management:
Tenant management is a core service, which involves finding, screening, and managing tenants. A property management company starts with advertising your property and conducts background checks of the prospective tenants for their creditworthiness, employment, and rental history. Once tenants are selected, property managers handle lease agreements, and rent collection, and ensure that tenants comply with lease terms and conditions.
- Property Maintenance:
Any issues with the property are the responsibility of the owner. When you have a property management company onboard, it will handle all maintenance issues on your behalf, including maintaining the physical condition of your property, such as regular repairs, cleaning, and landscaping. Property managers handle any issues and complaints by the tenants and ensure that the property is kept in good condition and that all maintenance work is performed efficiently and cost-effectively.
- Financial Management
Managing the finances of a property means collecting rental money on time, tracking expense,s and then giving you a balance and rental income. Property managers will also help you create and manage your property’s budget, providing you with financial statements and reports that allow you to track your property’s performance.
- Legal Compliance
It is the job of the property manager to ensure that the property complies with all applicable laws and regulations, including building codes, safety regulations, and tenancy laws. Property managers will keep you updated on any changes to the regulations and provide you with advice and guidance on how to remain compliant.
You might also need help with other legal issues such as non-payment by the tenant or tenant not vacating the property even when they have been served a notice. Sometimes tenants also overcrowd a property, which is an offense in Dubai and the government imposes a fine for that. Your property manager will handle all these issues for you.
- Marketing and Advertising
Just like any other business, renting properties also requires marketing. To attract the right tenants for your property, a property management company will also market and advertise your property. Typically, marketing activities include creating advertising campaigns and promotions for the target group, using a range of marketing channels such as online platforms, print media, and social media. Property managers are also registered with property portals such as Dubizzle and Property Finder and they also promote your properties on these portals to ensure that it gets rented on time. Often companies also organize open houses to showcase your property to prospective tenants.
Why Should You Hire a Company?
If you are a foreigner, who owns property in Dubai, or even if you are someone who lives in Dubai and have property for investment purposes, then it is a good idea to hire a property management company. Especially, if you have a portfolio of properties, then a property management company is worth your time and money.
With their in-depth knowledge of the local market and regulations, property managers in Dubai can help you maximize your rental income and ensure that your property is always in top condition.
A property management company will:
- Help you achieve your investment goals by ensuring that your property is always rented and at the best rate possible. They have the platforms for the right marketing and attracting the right customers.
- Handle all the routine maintenance tasks for you so you don’t have to invest your time in it
- Tackle any legal issues that arrive. Property management companies are well-equipped to handle any legal issues. They have a connection with all the departments and lawyers and are thus in a better position to resolve any issues.
- Guide you on the updates on rent and whether you should sell your property and invest in any other project or not.
Understanding the Process
Before you onboard a property management company, you need to be aware of the property management process and the charges that are involved. These are the steps that you need to follow after you have chosen your preferred property management company:
- Step 1: You need to sign an Initial Management contract (IM). This contract gives the company the authority to take your property under their management.
- Step 2: The company will then make the management contract. You can decide the time period of your management contract and the property management fee with the company. Once the company has the IM and management contract approved by the Dubai Land Department, it can make Ejari (Tenancy contract).
- Step 3: You need to sign a NOC that allows the company to advertise your property on various portals and their social media platform.
- Step 4: Once the company has vetted and selected a tenant, it will make an Ejari, which you will have to sign.
- Step 5: Collect your rental income. Depending on the terms of the tenancy contract, you can get your rental income in 1,2 or even 4 cheques.
How to Choose the Right Property Management Company in Dubai?
Choosing the right property management company is an important decision that you shouldn’t take lightly. You should always go with a trustworthy company that you believe will give your rental income on time and help you manage all aspects of your property, from finding the right tenants to ensuring timely rent collection and property maintenance.
Here are some tips to help you make an informed decision:
- Look for experience: Choose a company that has been in the industry for a few years and has a proven track record of managing properties in Dubai. Check their portfolio and client testimonials to gauge their level of expertise.
- Check their credentials: Ensure that the company is registered with the relevant authorities in Dubai, such as the Dubai Land Department and the Real Estate Regulatory Authority (RERA). This will give you peace of mind that you are dealing with a reputable and trustworthy company.
- Assess their services: Consider the services offered by the company, such as property marketing, tenant screening, rent collection, and property maintenance. Choose a company that offers a comprehensive range of services that meet your specific needs.
- Gauge Transparency: Look for a property management company that provides transparent and efficient services to its clients. You need to ensure that you get timely rental payments
- Consider their fees: It is important to fees charged by the company and compares them with other property management companies in Dubai. Choose a company that offers transparent and competitive pricing that aligns with your budget and investment goals.
Make an Informed Decision
When it comes to maximizing the value and profitability of your real estate investments in Dubai, choosing the right property management company can make all the difference By taking the time to research and evaluate your options, you can find a partner that not only meets your needs but exceeds your expectations in every way. Whether you’re looking for help with tenant screening and management, property maintenance and repairs, or financial reporting and analysis, a top-tier property management company can provide the expertise and support you need to achieve your goals.
So if you’re ready to take your property ownership game to the next level, we encourage you to put the tips and advice in this guide into practice today. Start by defining your goals and priorities, researching potential property management partners, and asking key questions to ensure you find a partner who aligns with your vision and values.