Housing: rent out your property by yourself or via a professional?
MONEY ISSUES – If you are going to put an apartment or a house up for rent, it’s an aspect you’ll be thinking about. If you have free time, good legal knowledge and live near the property, why not manage it all yourself? About 50% of all landlords and 65% of The Particulier’s subscribers (a French magazine) have made this choice.
For a property on at 800 € a week and giving you a gross profitability of 6% ,you’ll be paying 1664€ a year to a professional to look for a tenant and for the management costs
How much does a professional agent cost?
The fees of a professional, whether they be a notary, a real estate agent or a property administrator, reach on average 6% to 9% including taxes of the annual rent, including service charges. For that price, you will be relieved of all administrative tasks, such as collecting rent, keeping track of bills, allocating rental charges, to review the rent or manage claims and track repairs. Moreover, if you entrust him with the task of looking for a tenant and writing up the lease, he will charge you a commission which can be up to two months of rent maximum, to be paid by you and the tenant. This cost is not insignificant and will make a dent into the rental yield. Finally, for a property on at 800€ a month (including all taxes) and providing a gross return of 6%, you’ll be paying 1664 € a year to a professional if he finds the tenant (800€ fee) and manages the rent (he gets 9% of the annual rent, including all taxes, which is 864€). This reduces the gross yield to 4.96%.
How much time is needed to manage a French property on your own?
To look after it all yourself takes up a lot of time, for instance it could take you fifteen hours just to find the right tenant. You’ll have to make sure the compulsory diagnosis is done and annexed to the lease (energy performance diagnosis and, if necessary, the natural and technological risks and report on risks of exposure to lead), write and publish an advert, answer phone calls (you may receive more than 30 calls), show people round, write up the lease contract, and,finally, put together the inventory and make sure the tenant receives the keys.
As for day to day management, count on at least thirty hours a year. This involves lots of paperwork (twenty hours a year for collecting the rent, releasing bills, claiming back expenses that can be claimed, writing up the property revenue declaration and keeping up to date with legislative and statutory changes), monitoring all small works carried out (about 8h/year) and solving disputes, in case of delays or outstanding debts (2h/year).
How do I get help?
Several support softwares exist to help with rental management. However, they are usually expensive, complicated or quite limited in what they do. To respond to tenants’ needs., The Particulier offers a simple,comprehensive and personalised tool to manage your property whether it comes furnished, unfurnished or for seasonal rental only.