Buying a home is not easy, especially in urban areas. A person spends all his savings on down payments and then takes out a hefty loan whose EMI he has to pay for the rest of his life if income doesn't increase as predicted.
And what if the under construction property gets stalled or delayed? Nothing is more heartbreaking than this. So, in this blog, we will discuss how to deal with delayed housing projects and how to avoid them in the first place.
Housing Project Delayed: What Do You Do?
Usually, it's easier on the pocket for homebuyers to buy an under construction property and pay a pre-EMI. The Pre-EMI on a home loan is the interest paid to the lender while the property is still under construction. It doesn't adjust the loan that you've taken. However, when your project gets stalled, the first thing that strikes your mind is, what about the EMIs?. So, here are a few things a homebuyer can do in this scenario.
Form an Association
As a buyer, the first thing you should do is to visit the under construction building and check who else is there. That's how you meet up with other homebuyers, communicate with them, and form an association to work on this issue.
Search For Legal Recourse
The second step is to hire a law firm or lawyer with experience in property matters. Also, the lawyer should have both civil and criminal legal counsel because there can be a criminal case if your builder has misutilized the funds.
Get an Injunction Ordering the Bank Not to Deduct Pre-EMIs
The Karnataka High Court has recognized that certain banks or financial institutions wrongfully disburse very large sums of money to construction projects, due to which these under construction buildings stop or don't move forward.
As a result, banks cannot pressurize or take adverse action against such homebuyers and force them to pay pre-EMIs on projects that are still under construction, have been completely stalled, or have been delayed. Thus, homebuyers have the right to go to a civil court and get an injunction ordering the bank not to deduct the pre-EMI amount from them, or go to a high court as an association.
Marketing Schemes and Gimmicks - Subvention Schemes
In short, a Subvention Scheme is a legal agreement between the buyer, the seller, and the financial institution providing the home loan. In this scheme, the buyer doesn't have to pay any interest until an agreed-upon period, which is mentioned under the contract terms.
Although the central government scrapped this scheme in the 2019 budget, the builders have still continued to offer these schemes by making an agreement with the bank. Since the interest is borne by the bank and the customer doesn't pay it, the builders price their projects to include the finance costs into the price of their under construction buildings.
Now, the builders advertise these schemes to attract buyers by claiming that these schemes are more financially secure when you buy an under construction property. Consequently, the builder, the financial institution, and the homebuyer enter into a tripartite agreement. In a tripartite agreement, it is agreed that the homebuyer has to pay a very small down payment (ranging from 5% to 20% of the loan amount), and the bank will fund the rest of the amount.
When banks transfer these funds to developers, over which the homebuyers have no control, they end up diverting them to other construction projects. After a few years, the homebuyers realize that their project has stalled and nothing is moving forward. However, the homebuyer is still forced to pay the pre-EMIs, and he doesn't have the option to stop paying because his CIBIL score will suffer. And if he refuses to pay, the financial institution can take legal action against him by filing Section 138 or implement other legal remedies like sending recovery agents to his home.
What Legal Steps Can You Take as A Homebuyer?
File a RERA Complaint
The RERA regulations have made builders far more cautious, and buyers can get multiple kinds of relief if they file a RERA complaint. For instance, under Section 18 of the Act, a buyer can seek complete refund as well as compensation if he wants to exit from the project. Also, under Section 8 of the Act, the association of homebuyers can appeal to transfer the project's construction to another builder if they want to continue. Plus, a buyer can seek interest for a delayed period.
Although the execution of RERA orders is difficult, once a homebuyer gets a RERA order, it's important to understand that his debt is secured in many ways. If the homebuyer does end up in insolvency, this piece of paper will ensure that he is a financial creditor of that particular company and can seek his right before the NCLT (National Company Law Tribunal).
File a Petition Before NCLT Court
NCLT is a great option available for homebuyers. For instance, when a group of homebuyers have formed an association, they are now recognized as "Financial Creditors" in the NCLT under the IPC code, which is the "Insolvency and Bankruptcy Code." Thus, homebuyers can collectively approach the NCLT and file for a Corporate Insolvency Resolution Process (CIRP). If the petition is accepted, the entire CIRP process starts where a resolution professional is appointed who specializes in handling distressed companies and distressed projects.
File a Complaint in Consumer Court
Consumer Court is another excellent option for homebuyers. Because RERA and Consumer Court are parallel forums, a homebuyer can approach both, but he cannot ask for the same relief in both forums. For example, if a homebuyer asks for a refund in RERA, he cannot do the same in Consumer Court. However, he can ask for compensatory damages in Consumer Court.
File a Criminal Complaint Against the Banks and Builders
Homebuyers can also file cases against the banks because they have released large sums of money without really considering the stages of construction, thus, violating the public trust doctrine that banks as financial institutions owe to the public. Plus, if the builder has misused the funds in any way, the homebuyers can also file a criminal case against the builder.
What If Another Builder is Willing to Take Over the Under Construction Property
Even with all of the legal remedies and knowing what the ground reality is, it's a very viable option for homebuyers to consider. It can take years to get a court order in your favour and execute the order. However, many homebuyers will refuse to go with a new builder, or the new builder will have a lot of terms and conditions for taking over your project, but it's all about balancing the options available.
How Do You Avoid Falling into a Delayed Housing Project?
Conduct a Thorough Background Check
A proper background check on the builder, the property, and the project itself is very important. It includes the financials of the project, the fund sources, the banks involved, etc. This research will also reveal whether the builder has a lot of financial constraints, whether he has the financial stability to finish the project, or whether the construction company has a lot of debt, and more. Thus, it will help a homebuyer decide whether or not to proceed with the project.
Ensure that your Agreement is Registered
As a homebuyer, make sure your agreement is registered when you sign it. Many homebuyers confuse franking a document with registering. Franking is the process of getting the document stamped and indicates that the document is legal and the stamp duty has been paid. However, it doesn't ensure that your document is registered. A registered agreement is one that has been signed and scanned by the Government's Registrar office. A registered agreement has admissibility in a court of law, and it allows the homebuyer to transfer his rights if required.
Ensure the Project Has Got All Necessary Approvals
When buying an under construction property, make sure it's in a condition where the construction can take place without any interference. So ask the builder if they have received all necessary approvals to construct the project. Ideally, you should consult a lawyer when you plan to buy a property. The lawyer will ask you to get a list of documents from the builder, which you can ask from the builder and submit to the lawyer for verification.
Prop.Academy is sponsored by PropertyAngel. Prop.Academy aims to inform and educate consumers about real estate affairs and upskill professionals on the latest tools and best practices.
In this video, Sapna Chandiramani, Co-founder of PropertyAngel, speaks with Advocate Ayusshi Agarwal, Founding Partner of Karya Associates, and Pawan Chadha, a distressed home buyer.
Many owners and potential clients often wonder what full-service property management Bangalore is. When we say "full service," we're not just using a shopworn cliché. We mean that we offer a complete range of property management services that set us apart from the ordinary.
In this article, we will go over property management Bangalore and the full range of services offered by PropertyAngel.
What is Property Management?
By definition, property management Bangalore is the management of real estate by a third party. The responsibilities of a property management firm typically include day-to-day operations such as marketing rentals, screening tenants, setting competitive rental rates, coordinating necessary maintenance and repairs, collecting rent, managing budgets, and complying with all rental laws and regulations.
PropertyAngel's Full Property Management Explained
When you handover your real estate portfolio to our property management Bangalore services, we make sure to take care of everything, from tenant screening and marketing to rent collection and maintenance. Let's jump into the list of responsibilities:
1. Setting competitive rental fees.
As one of the best property management firms, we know and understand the market and the areas we work in. That's why setting rent is one of our main responsibilities. We perform an annual survey of similar properties in a given area. In this way, we ensure that our rates are attractive to tenants. That's why our customers have confidence in our full property management Bangalore services.
2. Collecting rent
Just as we set rental rates, we are also responsible for collecting rent. Through our tech-enabled property management Bangalore services, we implement a user-friendly system for tenants to make their monthly payments.
3. Finding tenants
Finding tenants requires a lot of research, time and planning. At PropertyAngel, we first analyze the market where your property is located and then devise a strategy to attract the right tenants. We post pictures and videos of your property on social media and various real estate websites to promote it.
4. Screening tenants
Once we generate a flow of potential tenants, we screen these individuals to ensure they are stand-up citizens who will pay their rent timely and respect the premises. Our screening of tenants typically involves a meet and greet, a background check, and/or a credit score check. Our property management Bangalore services have the tools and resources to make this happen.
5. Managing daily complaints
It's bound to happen; every tenant will have complaints at some point. We know how to deal with these complaints in a timely and fair manner. With our full property management Bangalore services, you can avoid the headache that can come with sorting out disputes.
6. Arranging tenant move-in or move-out dates, as well as evictions
We arrange both move-in and move-out dates and ensure these dates comply with the signed contracts. In addition, we collect the security deposit and return it upon exit clearance. Also, our property management Bangalore services facilitate evictions legally and fairly.
7. Property maintenance
Property maintenance is an important aspect of our property management Bangalore services. We create a long-term maintenance plan for your property and make sure it meets the legal building regulations.
8. Managing the Budget
PropertyAngel is well-versed in comprehensive budgeting. We use the budget to set various quarterly goals. In this way, we closely monitor the income and costs and make quick strategy changes if the existing systems fail. We typically include these costs in the budget:
Need for Property Management Firms in Bangalore
Are you looking for property management firms in Bangalore? Then look no further. PropertyAngel is a leading O2O (online-to-offline) second landlord platform. We are a Bangalore-based property management company offering professional property management for individual apartments, houses, and villas. We have almost 8 years of experience in property management Bangalore.
Since November 2014, we have had customers in 95 countries, managed over 1.5 million square feet, and have a 100% on-time rent distribution record.
To know more about our property management services, contact us at (91-80-47095974) or (91-7406484455).
Residential property management services are highly beneficial to any landlord, whether first-time landlords or experienced owners with multiple properties. Dealing with all of the daily demands of tenants - as well as tenant turnover - takes a great amount of time. Most landlords work a day job while owning rental properties, and they do not have unlimited hours to devote to their rental property. Using residential property management services allows you to enjoy the benefits of owning rental properties without the added stress of another job.
Continue reading to learn more about the beneﬁts of using residential property management services.
What are Residential Property Management Services?
A residential property management service will handle all aspects of your rental property, including finding tenants, dealing with maintenance, and collecting rent.
Residential property management services can respond quickly to your tenant's needs. When a tenant has a problem, they want to know that their landlord will fix it as soon as possible. You might have a full-time job or not even live in the same state as your rental. You might not be able to drive over to the house and personally inspect everything that goes wrong. You must always have someone to respond to your tenant's needs as soon as possible. The perfect solution is to use a residential property management service. If your tenant has a repair problem or another concern, they can contact the property management company and have it resolved right away. The tenant will be pleased, the problem will be resolved, and you will no longer have to deal with it.
Residential property management services help keep your tenants happy and in your unit. For landlords, turnover is a big expense. When the previous tenant moves out, you must make repairs, market the property, and find a new landlord. Meanwhile, the unit may remain vacant for some time. You will be much better if you can keep your tenant happy long enough for them to stay in your rental property. After all, residential property management services are in the business of keeping tenants satisfied. They will look after your tenants and make sure they are pleased to live in your rental property. Thus, tenants will want to keep living there.
Residential property management services minimize your stress. If you're like most landlords, you want the benefits of owning a rental property without the hassles of day-to-day management. Is that impossible or too good to be true? It doesn't have to be that way. Residential property management services will handle all the stressful details while you sit back and collect rent.
Why Hire PropertyAngel?
Our residential property management services offer a host of benefits to landlords and tenants alike. If you have a day job or you don't live near your rental property, rest assured we can help you meet your investment goals. When you work with us, you can expect the following services:
At PropertyAngel, we always keep our clients updated on the status of their rental property. As our client, we will provide you with comprehensive, detailed reports on your property. You can access your statements through your owner's portal at any time.
Our screening process helps us find the best tenants. When we screen tenants, we look at various factors to make sure they are the best fit.
For example, we look at how much money a prospective tenant makes each month. This allows us to analyze whether they will be able to pay their rent on time.
We also check each prospective tenant's employment, criminal, and rental history. As per state law, our screening process is thorough while also being fair to all applicants.
On-Time Rent Collection
PropertyAngel can make sure you receive consistent rent payments from your tenants. Before a tenant signs a lease with us, we ensure they understand all terms, including rent. This helps to avoid future confusion and misunderstandings that may result in late or missed rent payments.
With our years of market analysis experience, we can also help you figure out the correct rental price for your property.
Effective Property Marketing
Our marketing process is aggressive and produces quick results. Our marketing goal is to find you a desirable tenant in as little time as possible.
With online marketing, we maximize your property's exposure by posting pictures and videos on our website, social media, and various real estate portals.
Regular Property Maintenance
PropertyAngel can also help you with your property's maintenance needs. We respond quickly to tenant maintenance requests and inspect your property on a regular basis for potential damage.
We understand the importance of maintaining your rental property. A well-kept property attracts the right tenants and abides by the state's habitability laws. When it comes to maintaining and repairing properties, our team of contractors is experienced and skilled.
PropertyAngel is an O2O (online-to-offline) solution-oriented property management company. When you hire us:
We treat all our clients with respect, transparency, and integrity. Get in touch with the experts at PropertyAngel. We provide residential property management services. PropertyAngel will take care of every aspect of your rental property. We'll market your property, screen tenants, handle repairs, and collect rent. Contact PropertyAngel to learn more about our residential property management services.
Introduction to Rental Property Management Companies in Bangalore
Rental property management companies in Bangalore manage rental properties on behalf of their clients. In other words, the company handles every aspect of the property, from the initial inspection to its maintenance and repairs.
Plus, the best property management companies in Bangalore offer marketing and advertising services to help renters find and pick the right rental property, as well as coordinate tenant move-in and move-out services.
Rental property management companies in Bangalore typically charge a fee for their services, which depends on the size and complexity of the property.
Besides, residential property management services include additional services like 24-hour emergency service or property inspection management software, which allows landlords to track expenses and income easily.
1. Rental Property Management Companies in Bangalore Services
Below are 8 services rental property management companies in Bangalore offer:
Directly with Prospects and Tenants
This includes finding tenants, screening applicants, managing leases, and setting appropriate rent levels in compliance with state and municipal laws.
Best property management companies in Bangalore will know where, when, and how to advertise your vacant property to get you the high-quality prospective renters needed to minimize property vacancies. At PropertyAngel, we maximize your property's exposure by posting pictures and videos on our website, social media, and various real estate portals.
The screening of rental applicants can yield reliable tenants who pay on time and stay in their leases longer. Rental property management companies in Bangalore thoroughly screen prospective renters by running credit checks, verifying employment, checking references, and performing criminal background checks.
For newer property owners, it may seem easy to create a standard lease agreement, right? Not so fast. Managing leases can be a full-time job in itself. Experienced rental property management companies in Bangalore will:
Setting rent levels
Setting appropriate rent levels can make the difference between earning a healthy income from your property and pursuing an expensive hobby. Best property management companies in Bangalore can provide market insight and analysis, which can help you set competitive but profitable rates.
2. Rental Property Management Companies in Bangalore Collects and Deposits Rent
Collecting timely payments from customers is a challenge in any business. Rental property management companies in Bangalore have systems in place for collecting and depositing rent payments, security deposits, and late fees in an efficient and timely manner.
We have a 100% on-time rent distribution record at PropertyAngel.
3. Rental Property Management Companies in Bangalore Handles Maintenance and Repair Issues
Regular maintenance is necessary to protect your property value and keep tenants happy. Rental property management companies in Bangalore have the experience and resources to complete the job, including repair services, contractors, and staff. Also, remember the unscheduled maintenance requests that come in, often at night or early morning, when tenants have a clogged toilet or lock themselves out of their units. Thus, residential property management services provide 24-hour on-call maintenance service.
4. Rental Property Management Companies in Bangalore Respond to Tenant Complaints
Tenant complaints range from noise and pest infestations to concerns over potentially hazardous conditions like toxic mold, faulty wiring, carbon monoxide, etc. While pest control can help with the former, the latter complaints require further investigation. Best property management companies in Bangalore know how to handle these complaints in a professional, timely, and non-emotional way.
5. Best Property Management Companies in Bangalore Handle Move-Outs
Move-out duties include returning (or not returning) the security deposit, cleaning the property, and making any repairs. These tasks can become tedious in the unfortunate circumstance of an eviction.
6. Rental Property Management Companies in Bangalore Keeps You Compliant
Rental property management companies in Bangalore have an in-depth knowledge of state and national laws governing the rental property industry. They'll help to keep you legally compliant and minimize your risk exposure in matters ranging from safety and environmental compliance to discrimination and eviction.
7. Rental Property Management Companies in Bangalore Manage the Budget and Maintain Records
Best property management companies in Bangalore can help you with tedious record-keeping responsibilities, advise you on which deductions you can claim, and even file taxes on the property.
8. Supervise Property and Personnel
Best property management companies in Bangalore will supervise and manage maintenance and security personnel to ensure they do their work in full and on time. In addition, they can provide 24/7 protection of vacant properties against vandalism and theft.
Knowing these eight things rental property management companies in Bangalore do will help you make the right choice. You should also consider your available budget, time, and resources to decide what is best for you. To learn more, visit our blog or call us at (91-80-47095974) or (91-7406484455).
Today, building a rental property portfolio is synonymous with the best retirement and wealth-building strategies. A well-managed portfolio of rental properties is entirely capable of helping savvy investors achieve financial freedom passively, both now and in the future.
However, a passively managed portfolio of rental properties requires a qualified property manager. A truly great property manager will allow investors to continue adding to their portfolio without adding more work for a fee, which begs the question: how much does a property manager cost? How much do property management firms charge for the peace of mind they offer to their clients? Even better, is the cost of property management worth it?
The average property management fee ranges from 6% to 12% of the rent collected. However, rental property owners are more interested to know where their money is going rather than the exact property manager cost. If nothing else, the cost of a good property manager is well worth it. At PropertyAngel, our monthly management fee is 9% of the rent collected. There are no yearly or hidden fees to worry about.
Let's look at the fees investors can expect to pay throughout a property management contract.
Common Property Manager Costs
Property managers have earned a reputation for being the most valuable asset to passive income investors (outside of the properties themselves, of course). Property managers handle everything from running the property to collecting rent, allowing investors to own multiple assets without being bogged down by day-to-day operations. Thus, it's pretty common for today's property management firms to provide a full range of services and fees:
A setup fee, also known as an onboarding fee, is exactly what it sounds like: a fee that homeowners must pay to do business with a property manager. A setup fee will represent the cost that homeowners must bear to open an account with a specific manager. Setup fees are typically not included in the monthly collection because it's a one-time fee. However, some managers may charge a setup fee for each additional property added to the portfolio.
A leasing fee is the price landlords must pay to fill a vacancy and is one of the most common property manager costs. A leasing fee, also known as a placement fee, is the cost imposed on homeowners by property managers to fill vacant homes. The leasing fee can vary greatly because of its direct correlation to market demand. That said, one thing's for sure: leasing fees contribute a large portion of the cost of working with a property manager; they are, after all, the most common reason rental property owners seek the services of a manager in the first place.
Early Cancellation Fee
Most contracts with property management companies will include an early cancellation clause. Homeowners may be penalized for terminating their contract with a manager early, just like how tenants may be charged extra for breaking a lease early. While not every manager includes an early cancellation fee in their contract, it is very common. Therefore, if you notice an early cancellation fee in your contract, don't be worried; it's not a deal breaker. Just do your homework and make sure you hire the right manager for the job.
Depending on the property manager, this fee may already be included in the leasing fee. After all, advertising is one of the biggest expenses in securing tenants. The property manager will use this to fill vacancies. Because advertising costs can differ greatly, the contract must specify how much money will be dedicated to advertising. This property manager cost will increase your home's exposure in almost every platform.
The maintenance fee covers the cost of keeping contractors and other maintenance service providers on retainer, which means the property manager will have access to their expertise when needed. However, it's important to note that this property manager cost is only used to pay for the services of said workers, not the work itself. The homeowner will be responsible for any additional work. Also, maintenance workers will need to be compensated for the materials and time spent on each individual job, which can vary considerably from project to project.
Property management fees are generally included in contracts to give managers a cut of the money homeowners earn. However, property managers lose money if the property remains vacant. Thus, some companies charge a vacancy fee. The vacancy fee will charge homeowners for vacant properties so they don't lose money. However, it is the manager's responsibility to keep the home rented, so many would argue that this fee is the most unjust. This fee should raise some red flags for you as a homeowner.
At PropertyAngel, you will not be charged a single fee until your property is rented.
Reserve Funds Fee
The reserve fund fee is more like a bank account with no interest. The reserve fund is basically a pool of money the manager can draw from when the property needs attention.
Automatic Payment Fee
Non-cash transactions cost money to complete. Thus, most property manager costs include an automatic payment fee in the contract. Therefore, the homeowner has to pay the transaction fee. This fee not only ensures that the homeowner will pay their bill on time each month, but it also reduces overhead for the property manager.
Lease Renewal Fee
Because of economic fluctuation and the current market environment, rental guidelines and leases are constantly changing. It is not uncommon for rental rates to change at the end of a lease in order to meet the new standards. Thus, after each contract expires, new leases are required. This property manager cost is meant to cover the cost of a new lease when new tenants move in.
Late Payment Fee
Late payment fees are common provisions in any property management agreement. They state that the homeowner must pay any late or missed payments. The good news is that this fee is completely avoidable with proper budgeting.
Eviction fees can quickly add up, but they are well worth the admission fee. Evictions are upsetting, costly, and stressful, which all investors would rather avoid. Thus, paying an eviction fee to the property manager to handle everything makes perfect sense.
The average property manager cost may seem to distract people, but it is important to consider the expense as an investment. Of course, hiring a property manager will cost money, but the initial investment can be recovered easily through the number of services provided. In fact, the right property manager can return more profits than their initial investment. To make your rental portfolio work for you, call us at (91-80-47095974) or (91-7406484455).
Real estate investing can be a great source of passive income. However, managing a rental can require a lot of time commitment that you may not be up for. At this point, the benefits of hiring a property management company become clear, but how do you choose the right one? Because your rental property is one of your most valuable assets, you want to work with a trusted property management company. Here are some important steps to take when finding the best property management company.
You trust the judgement of your family members and friends, so ask them for a recommendation on a property management company and how their experience has been with the company.
Do your research online! Google "Property Management Company in Bangalore" and visit their websites. Their websites should include information about their property management services, fees, team members, experience, and awards. A company that regularly publishes blog posts, social media posts, etc., will give you insight into their rental market knowledge. A company that has received multiple awards from reputable businesses will convince you that they are recognized as a reputable business in the city.
Look at the reviews of a property management company. What are their current clients and tenants saying about them? Reviews should give you insights from both sides of the property management service. How do they treat their customers vs. how do they treat their tenants? If they have negative reviews, check if the company has replied with a comment. Their response will provide valuable information about how they handle stressful situations and their customer service.
Next, contact the property management company and arrange a meeting with one of their agents or property managers. Often, property management companies offer free consultations. Ask them how well they know the rental market in your area, particularly in the neighborhood where your rental property is located. How will they market your home? Are they licensed? Do they provide tax services to non-residents? How do they handle repairs and maintenance?
Review Their Agency Agreement
Check out all of their property management services, fees, and procedures. Some property management companies charge an all-inclusive management fee, while others charge a lower management fee with additional surcharges for services like inspections and maintenance. Knowing what fees to expect will help you plan your budget and rental cash flow.
About PropertyAngel - Property Management Company in Bangalore
PropertyAngel is a leading O2O (online-to-offline) second landlord platform. We are a Bangalore-based property management company that offers professional property management for villas, individual apartments, and houses. PropertyAngel has over 7+ years of experience in property management.
When you hand over your keys to PropertyAngel, we become your second landlord. In other words, if you hire PropertyAngel, you won't have to worry about property management issues. Also, we look for tenants who plan to stay in your home for at least a year. We don't shortlist short-term tenants. Since November 2014, we have had customers in 95 countries, manage over 1.5 million square feet, and have a 100% on-time rent distribution record.
In the end, hiring a property management company to manage your real estate portfolio should make your life easier. However, when choosing between service vs. cost, one must weigh the pros and cons of it. Thus, putting in the work to research a company beforehand can help you avoid a headache and additional costs due to lack of service later on.
Contact us at (91-80-47095974) or (91-7406484455) and make your real estate portfolio work for you.