What is Real Estate Asset Management ?
Assets can be of different types and for the sake of convenience are basically classified into two major types, i.e. moveable assets and immoveable assets. Moveable assets can of any type such as gold and other commodities, stocks and shares, hard cash, etc., while immoveable assets could be buildings, factories and other assets which cannot be easily moved from one place to another. Having assets is one things and managing the assets is another thing. So, asset management plays a very important role and cannot be done by everyone because it requires special skill sets.
Of all the skills related to management of assets, managing of real estate assets is indeed a big opportunity but challenging at the same time. The process apart from being tedious calls for constant monitoring and supervision and hence many individuals and even organizations prefer leaving this job to experienced and skilled professionals.
Pitfalls in managing real estates
Real estate asset management is riddled with risks and difficulties and the major factor which is very risky and unpredictable is of course the wildly fluctuating real estate prices. Though real estate can be a good investment, the volatility in this segment is a matter of concern for the real estate asset managers. Especially, after the 2008 financial market collapse, the prices of real estate have really fluctuated wildly. This market is replete with numerous instances of the real estate bubble bursting quite often leaving thousands of investors high and dry.
Hence, managing real estate properties is not just about taking good care of the property, but seeing and keeping an eye of the market and ensuring that the customer’s hard-earned money sees the best returns over a period of time. So access to timely and correct information is of utmost importance in managing real estate properties and this is a much difficult job that what it actually seems to be.
How to Manage Real Estates Effectively
Real estate asset management includes offering a structured approach in taking care of real assets and must consider all factors that form a part under the gamut of real estate investment. It could be described as a very disciplined and systematic approach to not only maintaining but also growing real estate properties in a manner which can be described as highly cost-effective. To do this a lot of factors and situations come into play which must be taken into account and carefully considered.
While the list is very big and exhaustive and would need a lot of details to be written, there are some basic things, which are being discussed here. It could be the location of the real estate property, the quality of building and structure, the legality of the property and the land on which it is built, the cost involved in maintaining and upkeep of the property and most importantly the growth prospects of the property over a period of time. Doing all these jobs simultaneously is indeed a humongous task and that is the reason use of technology is recommended when it comes to real estate asset management.