Interview: „Property Management is Not for Everyone…”
April 4th, 2018
There are several situations that a flat owner does not want to face. As a result, more and more people rather hire professional managers to rent their apartments. We asked Dávid Kirschner, property manager at Tower International property management company in Budapest, about his professional challenges.
What was the hardest story you met?
There have been many, and unfortunately there are difficult stories time after time. Sadly, this is not a unique case, but for example, a bona fide owner learned a great lesson when she became in a very good term with her foreign tenant, but after a while the tenant did not pay the rental fee. Moreover, he was always able to explain it. Then they got to the point when the man decided to leave the country and go home abroad, and he still did not want to pay for the multi-month debt. Finally, the owner called the police, but they were helpless in such a situation - they could not get him out of the apartment, nor did he pay the rent, even though he was still threatening the lady. Based on these experiences it's worth to consider to contract with professionals before letting.
Another owner has recently told me that his friend rented his Budapest apartment - in good belief, without a contract. Well, the “tenant" did not pay for it after a while, and on one occasion he had called the police to the owner because of charges of trespassing. It was a yearlong calvary that this "friend" would leave the property. After this incident, the owner decided that he would never rent any apartment anymore without the help of a professional manager.
How can you tell about a tenant beforehand that he or she is going to be a bad tenant?
We do not have a culture of gaining information about tenants like in western countries. For example, in the United States, very serious forms need to be filled out by a tenant who has to declare everything. However, our company has been dealing with home and foreign investors in Budapest for 15 years – this means thousands of tenants, therefore we had time to gather experiences from different types of people. Good knowledge of personality types is important, but there are other professional considerations as well. At the beginning everyone is introduced as a perfect tenant, he or she is even willing to give proof of income if necessary. Then with time he or she starts not paying the rental fee. Our company handles nearly more than 900 homes and there are a small number of bad tenants, which shows that the system works. We put great emphasis on prevention.
What can be done when the trouble has occurred?
A notary's statement at the beginning can be an important step because it facilitates the process if it is to be legally bound. If the tenant does not pay the rental fee, in the majority of cases, the trial succeeds. We invite him or her to our office into an elegant meeting room and clarify the situation. Most of the time, a common understanding is more worthwhile for both parties than a protracted case, and the apartment can be returned to the market sooner. If the problem has already happened, it is worth thinking about the involvement of a specialist due to the minimization of the damage. I have been in such a situation that at first seemed pretty much impossible to solve, but then we were able to turn back on it. It is important to keep in mind that home ownership is stronger than property ownership in Hungary, so the most important thing in hiring is to focus on prevention. A well-prepared and well-negotiated rental agreement is essential, which can be coordinated by experienced technicians.
Is there a typical mistake that many owners make while handling his or her apartment on their own?
This also depends on the tenant. If a serious multi company or embassy is the tenant, it is not worth fleeting about certain things because the agreement can come about.
But the other end is not good either if we promise everything. It is very important that, apart from mutual trust, all details of the agreement process should be recorded. To do this you need to know not only the culture from which the renter comes (including his priorities, thinking, etc.), but the domestic legislation and opportunities.
Anyway, property management is a wonderful profession, but it's not for everyone ... (laughs)