How does the current energy crisis affect property management companies?

The colder months of the year are approaching, and people’s concerns are growing. Are we going to have to freeze during winter because of the war in the Ukraine? This thought has probably crossed many people’s minds. 

How does the energy crisis affect property management companies? Will they only be facing challenges? Or could the crisis also be an opportunity? We took a closer look at the topic.

Communication first

One thing is clear: The situation is not easy to handle. BUT there are a few possible solutions that property management companies might find useful in the coming months. One idea would be to remind tenants and owners that they could voluntarily increase their monthly payments to their energy provider. Otherwise they might be in for a nasty surprise, which will inevitably result in more trouble for property management companies. You could also suggest to your tenants that they pay in instalments if the worst were to happen, and they suddenly can’t afford the rising energy costs any more.

Communicating these things is definitely a challenge. But at the same time, you could also see it as an opportunity to further digitalise the real estate industry. Using the right tool, like residential lettings software, eases the burden of communicating with your tenants and makes it more effective, plus you can always keep track of everything. Something else the right property management system could help you to communicate more efficiently is that it doesn’t only make sense for tenants to save energy in their own flat, but also in the entire building. If common areas aren’t actively used, the light doesn’t have to be on the whole day, for example. – Tenants might not realise that these costs are part of the service charge bill they get; something you could make them aware of.

Beware of letting your tenants freeze

In Germany, the following topic is currently a much-debated one: The Federal Association of German Housing and real estate companies is calling for a regulated minimum temperature for rental flats; also, the German Property Federation would like such a legal regulation to be introduced, since it might be necessary if the situation gets even worse. Up until now, the past decisions by the district court were taken as a reference – 20 to 22 degrees Celsius during the day and 17 to 18 degrees Celsius at night. Although the German government is allowed to impose measures to save energy, property management companies could face problems were they to turn their tenants’ heating down too much, since private households are especially protected.

Optimised Energy Management is gaining ground

“The energy crisis acts as an additional incentive for the energy system transformation,” says Patrick Graichen, the German State Secretary of the Federal Ministry for Economic Affairs and Climate Action. He is probably right. It clearly makes sense to switch to green energy; the current situation makes this more apparent than ever. But what would this mean for property management companies? For a start, buildings would have to be made more energy efficient. This can be done with the help of Artificial Intelligence: Sensors can be installed in different rooms to collect data. This data can then be connected to weather forecasts, people’s schedules and user habits. As a result, the sensor would realise that a room is empty and would automatically lower the temperature by around three to four degrees. Installing such a system is certainly an investment, but it would definitely prove to be beneficial in the long run.

There’s no doubt about it: We live in tumultuous times. Nevertheless, even those times may provide an opportunity to learn something for the future.