The Impact of Property Management on the Value of Residential Product in Saudi Arabia

Abstract

This paper discusses the impact of property management in maintaining the value of residential product in Saudi Arabia. The paper reviewed a comparison of two property models: the first is managed by the property management system, and the second is managed by the owner only. In addition, the field questionnaire was used and distributed to a sample of the study community consisting of 125 real estate management institutions and real estate office in Riyadh. The results of the analysis indicate that property management contributes to raising the quality of the residential product and maintaining its market value. The residential product which managed by the property management system loses 10% of its value after 5 years. On the other hand, the product that managed by the owner loses more than 50% of its real value after 5 years. The paper proposes to strengthen cooperation between governmental and private institutions to establish a Real Estate Data Center (REDC) for the classification of residential properties subject to the criteria of management, quality and economic cost.