When do you need a property management company?

In a condominium homeowners association, a wide variety of decisions regarding the property must be coordinated with the other owners. This includes, for example, the renovation of a staircase belonging to the building or the painting of the facade. Accordingly, there is a high potential for conflict that can lead to disputes. To avoid this, or to mediate if necessary, an external property management company is usually employed as a neutral entity. In addition, the management takes on a wide variety of other tasks.

What does a property management company do for landlords?

However, property management is much more than just a mediator. Above all, the duties of a management company include the following points:

• Tenant contact: Whether as a contact person for various problems, difficulties between different tenants, property inspections, or the collection of outstanding payments: property management assists the landlord in many ways. This also includes, for example, notices of termination as well as the hiring of lawyers and collection agencies. Management companies also assist with forced evictions.
• Technical support: From heating systems and domestic hot water systems to elevators, real estate properties are equipped with extensive technology nowadays. Property management, for example, takes care of maintenance and repairs. In addition, it handles renovations, coordinates appointments between tenants and craftsmen, and makes any necessary adjustments to lease agreements.
• Service agreements: Property management companies are also authorized to conclude necessary contracts for the cleaning and maintenance of the property. In this context, insurance and janitor contracts, for example, are also reviewed and the corresponding billings are carried out. If damage occurs to the building, management contacts the insurance companies and advocates for compensation.
• Everyday life: Likewise, the
• Rental: Furthermore, the companies assist in the search for new tenants and determine an appropriate rent price as well as the monthly advance payments for operating costs. This is done in cooperation with the landlord.
• Profitability: Last but not least, one of the duties of a property management is to ensure the profitability of the property. This includes not only generating the highest possible return, but also the preservation and increase of its value.

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What happens when you don't have a property management company?

If the property management steps down, the homeowners' association nevertheless continues to exist. Therefore, there is no explicit legal obligation imposed by the legislature to appoint an external management. The background for this is that, according to Section 18, Paragraph 1 of the Condominium Act, the management of all jointly owned property is the responsibility of the homeowners' association as a whole. This also includes the fact that, in the absence of an external management, the homeowners themselves collectively take over the joint representation.

Since in such a case all owners generally jointly represent and manage the condominium property together, it is, however, barely capable of acting. This is very difficult, especially in large buildings.

It is also important to note that this so-called self-management must first be decided upon jointly. If even a single owner votes against it, an external management must be appointed.

Can the property management issue a warning to a tenant?

If the landlord has equipped the property management with a corresponding power of attorney, the property manager is authorized to issue a warning letter. This is particularly the case if the tenant has failed to comply with their contractual obligations.

How quickly must a property management company respond?

If, for example, the property management fails to respond to instructions or does not enforce established resolutions, the owners can point out the implementation in writing or insist on it. According to Section 27, Paragraph 1 of the Condominium Act, the management is obligated to carry out a specific measure that has already been resolved at the condominium owners' meeting. However, the law does not provide a precise deadline for this. Because of this, it is essential to state a suitable deadline in the letter. This also applies to missing year-end statements. Here, every owner has an individual claim, meaning that the consent of the owners' meeting is not necessary.

If the property manager does not respond to the deadline, an informal, written warning can be issued. Every owner is independently entitled to do this, although it makes a stronger impression if all owners sign the warning.

Attention: If it is an urgent measure that is not being implemented by the administration, taking matters into your own hands is strongly discouraged. This is because in this case, the owner in question is acting independently and not as a representative of the homeowners' association. Accordingly, it is possible that the resulting costs will have to be borne entirely by themselves.

If the property management continues to fail to respond, a regular or extraordinary owners' meeting can be convened. The further procedure must be clarified jointly here. If the contractual relationship between the property management and the homeowners' association is permanently damaged, dismissal is possible.

Tip: To dismiss the property management, two different things are necessary: on the one hand, its removal must be determined within the framework of the owners' meeting by a majority vote, and on the other hand, the termination of the management contract must be approved or carried out. Subsequently, the homeowners' association either takes over the property management itself or a new, external management is appointed..