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The inability to reconcile tenants rent payment data has exposed property owners to 30 per cent revenue loss.
A new report released by property management platform for automating payments, Kiotapay, says that the lack of automation is preventing property managers from reaping maximum benefits from their investments.
Latest data released by Kiotapay indicates that landlords lose money due to the inability to track and properly reconcile tenants’ payments from different channels such as mobile money, banking agents payments and banking payments.
According to the report, property owners and agents also lose critical data such as tenant statements, financial records, complaints, repairs and maintenance data, which is critical in improving the quality of service they give to their tenants.
This essentially means that for a landlord expecting Sh100,000 from his investment, there is a likelihood that he will get Sh70,000 if he has not harmonised his payment systems.
Kiotapay CEO Paul Macharia said landlords have to wait for days, sometimes a whole month before receiving the collected rent and have no real-time visibility for the payment process.
“Property automation will lead to greater benefits for property rental investors. It will consequently improve their return on their investment,” Macharia said.
According to Macharia, landlords and managers also struggle with low occupancy due to poor marketing channels and low tenant satisfaction.
He said that streamlining the sector will see the cycles of property units going without tenants reduce significantly.
In the long run, the rental pricing will become affordable for the tenants.
The report notes that the landlords enjoying a 98 percent occupancy have no need of overcharging rent in order to stabilize their return on investment.
“For instance, there are rental houses that have an average of 65 per cent occupancy while people are looking for suitable houses to move in every day due to lack of automation in the rental housing market,” the report reads.
Additionally, financial leakages in the management of properties such as unreasonable house finders fees, unscrupulous and unprofessional people posing as agents, and unreasonable pricing have led to further losses in the property market.
According to the report, the property sector is experiencing rapid growth driven by innovation.
Some of the emerging technologies in the property sector include Virtual Reality (VR) and Augmented Reality (AR) which allow potential buyers or tenants to experience properties remotely, providing immersive virtual tours and interactive visualizations.
Internet of Things (IoT), where IoT devices can be integrated into buildings, enabling smart features such as automated temperature control, energy management, security systems, and predictive maintenance.
This technology enhances sustainability, operational efficiency, and tenant satisfaction.
Other innovations in the sector include Blockchain technology that offers secure, transparent, and tamper-proof record-keeping systems.
In real estate, it can streamline property transactions, digitize property titles, and enable smart contracts, reducing fraud and improving transparency while big data analyzes vast amounts of real estate data that helps to identify market trends, evaluate investment opportunities, and optimize property performance.
“It provides valuable insights for decision-making, risk assessment, and predictive modeling,” the report elaborates.
Despite the huge investment of more than $144 billion (Sh20.4 trillion) in Africa there is still a shortfall of 51 million housing units due to the mismatch as a result of the paucity of data that exist in the industry.
In Kenya, according to the World Bank, the development of housing units is currently at less than 50,000 units annually, well below the target number, culminating in a housing deficit of over 2 million units, with nearly 61 percent of urban households living in slums. BY THE STAR