Q3 Is it correct to assume that there will be no monthly income if my property is vacant?
Our company provides a sublease service that guarantees monthly rent (the fee is 10% of the monthly rent in addition to the handling fee). As such, you will still receive your monthly income from our company (as a tenant) even if your property is vacant.
The main concept with regards to property investment is “lowering the property’s vacancy risk.” With this in mind, we will be continuously aware of the market condition and find appropriate tenants that meet the price supply of the properties. As a result of our effort, the occupancy rate of roughly 1,600 units we have managed is as high as 95% (based on a February 2013 survey).
Q4 Will the monthly rent decrease as the property gets older?
In normal conditions, the monthly rent will decrease along with the building’s age. Because monthly rent is decided by the market’s supply and demand, monthly rent will decrease as the demand for older properties decreases. The main reason to the decreased demand of older properties is largely due to their outdated internal facilities and an aged exterior. To prevent a sudden drop in your monthly rent, we will continue to sustain the property’s maintenance and refurbishment (please refer to Q9 on “Before Purchase” for more details). Also due to the fact that the properties we provide are close to stations, near business centers, and have good accessibility, you can be assured that your monthly rent will follow a relatively stable trajectory even when your property ages.
Q5 Will there be changes to the management and maintenance fees?
Yes there will. The management and maintenance fees are there to ensure your property’s value and monthly rent. However, these costs will change according to market conditions. Generally, the newer the property, the lower the maintenance fee; the older the property, the higher the maintenance fee. It is our advice to not overspend on maintenance fees when the building is new – it makes much more sense to spend the money later on, when the property ages.
Q6 Is the landlord responsible of bearing the costs when an interior appliance breaks down?
It is required for tenants to revert everything back to its normal condition upon the termination of his or her rental contract. However if the appliance is not intentionally damaged by the tenant, the landlord will still be required to bear the costs. Things like water heater, air conditioner, kitchen appliance, bathroom, sink, door frame, lighting, etc. all fall under the category of interior appliances and they normally have a life span of 10 to 20 years before they need to be replaced. To minimize your burden, we will proceed to repair your scratched wallpaper or dented flooring when detected; please note that we will collect a certain amount of maintenance fee in order to maintain a good occupancy rate and prevent your property’s value and rent from dropping.