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Select one of the frequently asked questions below to learn more about property management. Also, begin to think about important things to consider when diving into your real estate search.

Question about Property Management

Can a home depreciate in value?

Generally, real property never depreciates in value, or more so, it is not very common for property to depreciate.  This is why it’s a great investment. Make sure you carefully consider location and community when choosing a home, it can effect the homes future value greatly.

If you are in a newly developed area, do some research on the construction of the surrounding areas being developed to determine if they may effect your homes value.

Is an older home as good a value as a new home?

This is really just a matter of preference, but both newer and older homes offer distinct advantages, depending upon your unique taste and lifestyle.

Older homes can generally cost less than new homes, however, there are many cases where new homes can also cost less then older homes. Most new homes will not have any backyard landscaping and some don”t include any front landscaping either. With an older home, the landscaping is normally already completed and could have 10”s of thousands of dollars in landscaping done, which is included in the purchase price.

Taxes on some older homes may also be lower. Some people are charmed by the elegance of an older home but shy away because they”re concerned about potential maintenance costs. Consider a home warranty to get the peace of mind you deserve. A good Home Warranty plan protects you against unexpected repairs on many home systems and appliances for a full year or more after you move in.

In a new house, you can pick your own color schemes, flooring, kitchen cabinets, appliances, custom wiring for TV”s, electrical, computers, phones and speakers, etc., as well as have more upgrade options. Modern features like media rooms, extra-large closets and extra-large bathrooms and tubs are also more attainable in ground-up construction. In a used home, you rely largely on the previous resident”s tastes and technological whims, unless you plan to farm thousands into a remodeling and rewiring.

New-home designers can use new building materials such as glazed Energy Star windows, thicker insulation and other technology that will lower future energy costs for the owner. Most states now have minimum energy-efficiency requirements for new construction. Kitchens and laundry areas in new homes are designed to house more efficient energy-saving appliances. Older homes, unless they have undergone an energy retrofit, usually cost much more per square foot to air-condition and heat.

Builders have to follow very strict guidelines in new-homes and additions, especially in the West and Northwest, where earthquake safety standards must be observed. In general, new homes are usually more fire-safe and better accommodating of new security and garage-door systems.

Older homes can be better judged for their quality and timeless beauty. New homes that now possess a smooth veneer might reveal the use of substandard building materials or shoddy workmanship over time.

As you can see there are advantages and dis-advantages to each, but it really comes down to what fits you and what you are looking for in a home.

How do Property Management Firms earn?

Firms managing properties such as Hotels, Condominiums or Apartments earn commissions for different things such as property management, inspection, attaining new customers, funds management, supervising property staff or contractors.

Please discuss with the property owner to know what your responsibilities will be.

What does it take for someone to be involved in this industry?

To operate, you must have a license and be registered in the necessary real estate bodies. It is advised that you become a member of any existing association so as to connect and be up to date with what is happening in the industry.

What is the best software for Property Management?

There are many existing in the technological world and they depend according to your preferences. Please visit them on the internet and see which one suits you best. They are:

i) Appfolio: this is the best in real estate management but it doesn’t operate in Africa. The last time we spoke to their representative, they said they have no plans to come to Africa.

ii) Propertyware: second in line, we got mixed feelings from their representatives about area of operation. At first they seemed to be open to operate in Africa, but later on they said otherwise.

iii) Buildium: coming third, you wouldn’t expect them to be the best in operation. These lads operate worldwide and support most businesses that are new in the industry. We definitely recommend them.

Can I pay my own taxes and insurance?

When a loan is originated, the mortgage documents specify the escrow conditions. This has become a standard practice for all mortgages, including FHA, VA and conventional mortgages.  Occasionally on conventional loans, FRFCU waives the collection of escrow requirement at closing if the member has a minimum 20% equity position in the property.

What is the job of a Property Manager

These are some of the tasks carried out by a Property Manager:

  • Establishes rental rate by surveying local rental rates; calculating overhead costs, depreciation, taxes, and profit goals.
  • Attracts tenants by advertising vacancies; obtaining referrals from current tenants; explaining advantages of location and services; showing units.
  • Contracts with tenants by negotiating leases; collecting security deposit.
  • Accomplishes financial objectives by collecting rents; paying bills; forecasting requirements; preparing an annual budget; scheduling expenditures; analyzing variances; initiating corrective action.
  • Maintains property by investigating and resolving tenant complaints; enforcing rules of occupancy; inspecting vacant units and completing repairs; planning renovations; contracting with landscaping and snow removal services.

How is interest calculated on a mortgage loan?

Most mortgages originated today calculate interest in arrears, unlike consumer loans which calculate interest to the date of payment receipt. As an example, when borrowers pay their February mortgage payments, they are paying the January interest. This method of calculating interest is based on a 360 day year in which each month has 30 days.

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