INTRODUCTION TO ESTATE MANAGEMENT

INTRODUCING ESTATE MANAGEMENT

The Basics of estate management

An article written by Nwabuisi Dennis

UNDERSTANDING THE RUDIMENTS ESTATE AND MANAGEMENT

Laymen see estate as house or set of buildings, but to real estate management students and professionals, the word “estate” means an interest one holds on land or landed properties. This interest can further be determined in terms of leasehold interest or free hold interest.

            Management on the other hand is an art or science coordinating sources through the aspect of planning, controlling, monitoring, coordinating, directing and organizing for the purpose of achieving a certain goal or objective.

            Over the years, there has been the concept of property ownership and land acquisition. This gave rise to the ever increasing number of ownership and interest in land and landed properties. People build and develop properties and different types of real property investments that earns them money and financial returns. Properties and landed properties at some areas were not managed well enough to maintain the income accruing from such properties to the owner. This was as a result of high population density, urbanization and increase in the housing needs of the people. As a result of this fact, there came a need for professionals who understand these changes in the economic lives of people and also know how to manage properties to avoid obsolesce and depreciation of values of properties because these trained professionals knows the essence of property value.

            Nevertheless, the Royal Institute of Chartered Surveyors (RICS) was formed in the year 1946 which gave rise to the formation of the Nigerian Institute of Estate Surveyors and Valuers (NIESV) board in 1962 which serves as a board for guiding and regulating the practice of estate management professional in Nigeria, they formulated laws, regulates and monitors the practice of estate management profession. It had the first annual conference at Ibadan in the year 1975, which gave it a name known as the “Decree No.24 of 1975.

DEFINING ESTATE MANAGEMENT

            Estate management can be defined simply as the management of urban and rural buildings to make money for the owner.

            Estate management can also be defined as an art of science of directing and supervising of one’s interest in land or landed property in other to achieve some optimum returns which may not only be financial but political, social statute, prestige and other returns.

            Estate management been a science implies that it makes use of some scientific methods and applications in finding solution to some problems and answering some questions. For example, property valuation is a scientific method that involves the application of scientific and mathematical methods in estimating the worth of a property.

            Furthermore, looking at estate management from the art side of view, we find out that estate management involves the use of common sense and ideas and knowledge in tackling issues in the field. It requires one’s experience, technical background and decision making skills which doesn’t require any mathematical or scientifically experiments in doing so.

            Estate management covers a large variety of disciplines that is why they are regarded as the jack of all trade and the master of one. Estate management covers the areas of architecture, land law or property law, building construction, quantity surveying and land surveying, land economics and general economics, agriculture and agricultural economics, town planning and public utilities, all these courses and discipline play vital roles in the life and practice of an estate management student or practitioner. It is important that students acquire the basic knowledge required of them in these disciplines and many more. A good background knowledge of the courses poses the student a better chance of practicing in real life situations.

            Over the years and recently, it has been diagnosed that people think that it is not necessary to study estate management since one has a business management idea. This conception is wrong because of some reasons though they have similarities but factually they are not the same.

v  Business management is mainly concerned with the management of goods and services commercially and industrially unlike estate management that is involved with the management of interests in land and landed property.

v  Estate management is concerned with the setting of policies, planning and development of interests in land and landed properties to secure optimum returns.

v  Estate management is also concerned with the studying of land laws, property laws, state laws concerning real or landed properties unlike the business management that does have such motives and goals of studying property or land laws.

v  Management skills in estate management varies at most cases with that of business management in the sense that managerial skill used by estate managers in managing assets might quite be different from that of a business manager.

CHARACTERSISTICS OF AN ESTATE

For one to call something an estate it must possess at list a minimum of these characteristics;

Ø  There must be a physical identity which implies that both natural and man-made attributes are involved which may include the design, location and geographical area of the property, size and shape of the property.

Ø  The economic condition or status of the property which implies the use to which the property is used for, the functional and financial status of the property including its income yielding level etc.

Ø  It must have a legal status which implies the rights exercisable on such interest or estate by the individual. This in fact is what differentiates a freeholder of estate from a leaseholder of estate in the sense that the freeholder has more power and rights than the leaseholder.

Ø  It should possess some managerial character it which implies that the managerial skill required in managing a block of flat in Umuahia would be or may be different from another block of flat in Lagos.

GENERAL ESTATE MANAGEMENT FUNCTIONS

In estate management practice and studying, general management functions are divided into two, namely;

The thinking and the doing process

The forecasting: this is another function that estate managers should be conversant with because it involves the conceptualization of a project that is to e carried out which can be inform of land development or property acquisition for investment purposes. With experience, an estate management should be able to forecast a project for an investor and also carry out social, political and economic viability and feasibility appraisal on such project to ensure that the investor’s money is put to its best use.

Planning: this is a managerial function that involves the setting of policies, goals and objectives. This is an important stage in the estate management profession that requires great skill and experience from the manager because planning stage forms a blue print for real project or plan execution like the saying goes that anything planned well is done well.

Organizing: this is a managerial function that is required of an estate manager. He has to be able to implement action and make it work as planned for integrating between resources to ensure that everything is in order.

Motivating: an estate manager has to be a good leader, in other words he has to be able to put confidence to his team or his client ensuring him of quality action. If working with a project team, he has to be able to motivate them to ensure that all work are carried out effectively and efficiently.

Controlling: this is a managerial role and function that is required of an estate manager, he needs to know how to manage and control resources to make sure that there is success in the work he is carrying out which is managing his clients estate or real property.

Coordinating: this function is important in estate management in the sense that it involves the manager integrating all the components of his portfolio to function together as one to achieve success and goals of the owner of such interest or estate.

Communicating: this is another crucial function of an estate manager that helps in the transferring of information from the manager to the property owner of the team he is working with. Communication can come in two ways namely; oral communication or written document as the case may be. Both communication methods are important and are used by the manager effectively.

FACTORS THAT AFFECT ESTATE MANAGEMENT

      Economic factors that affect estate management can be as a result of demand and supply of resources within the country. The economic status of the country can affect estate management. Nevertheless, cost of land inputs also affects estates economically. Labour and capital been the land inputs in estate management can posse a treat to estate management profession.

      Technological factors and increase in scientific innovations can affect estate management especially if a manager or property owner doesn’t update himself with the recent technologies because poor housing design will lead to low or decreased demand for such property and the financial returns of that property would be affected.

      Social factors like the norms and customs of places can affect the use of land in an area. The social life and culture of a locality can affect estate management.

      Legal factors like the civil and legal laws of a place can affect the practice of estate management in any place. Laws like the land laws, taxation laws and other property laws can affect estate management simultaneously.

AIMS AND OBJECTIVES OF ESTATE MANAGEMENT

As property owners are everywhere, so are the aims and objectives of estate management are. Nevertheless, there are some vital aims and objectives of estate management in a given place. They are;

ü  To satisfy economic need of an individual which can either be accommodation or otherwise.

ü  Estate management is aimed at providing profit to prospective estate owners especially in the private sectors whose aim is to get financial returns from their real estate or investment as the case may be.

ü  For independence as we can see, estate management is aimed at providing individuals with opportunities of been independent from others by providing various investment opportunities for these individuals.

ü  Estate management aims at providing individuals with social status and prestige which implies that property owners need not to be interested in acquiring financial returns but to maintain a hierarchy in the society by the properties they have.

ü  For political status means that it provides prospective political aspirants the opportunity to meet up to their expectations.

ü  Estate management makes it possible for one to get social benefit in form of government of a state developing parks and roads and hospital and other social infrastructures that will aid public services.

ROLES OF ESTATE MANAGEMENT IN NIGERIA

Over the years, questions have been asked about the importance and roles of estate management profession in Nigeria and to them some questions have been left unanswered. Below are some of the major roles played by estate management in Nigeria.

1.        Estate management makes it possible for equal distribution and allocation of housing resources amongst the people in Nigeria and to sustain and bring solution to social needs of the people which can be in the form of housing needs. Estate management paves way for a better compensation by the government to individuals whose land or landed property has been acquired by the government of the estate through valuation for compensation, also through its planning process it aids in town planning of any given location and sustainability of a built environment.

2.       Estate management also plays a vital role in the economic process of the country in the sense that it tends to bring a balance between the different economic sectors in the economy thereby breaching the gap between rent control values of properties and development costs.

3.       Estate management plays an important role in the administration of the general country’s laws and regulation of these laws especially in the housing sector of the economy.

IMPORTANCE AND IMPACTS OF TECHNOLOGY IN ESTATE MANAGEMENT

            Technology as we see today has changed almost all the aspect of human endeavors in all ramifications. We can see its importance in estate management because as a result of complexity of the task ahead of estate managers, the invention of electronic devices like the computer has helped estate managers in tackling some large management works especially in the analysis and presentation of both data and informations.

            Nevertheless, technology has helped estate management especially in the building industries and other landed property investments. There has been an exorbitant increase in the quality of building materials used in the construction industry which also helps in improving the values of the property and puts an investor in a better chance of securing some optimum returns in the investment therein.

            Furthermore, we can see technology playing a vital role in the communication sector in estate management in form of the telecommunication and the use of mobile phones and gadgets to enhance interaction between estate managers and their clients. We can also see the importance of technology in the transportation sector; this paves way for the transportation of resources from one place to another. Transportation has also made it possible for the distribution and allocation of land resources amongst the people in the country which would in turn improve the standard of living of the people and promote economic development of the nation at large...

Estate Management is an important aspect of human life espeically now that the population density of inndividuals are emernacing and growing at a fast rate... There is need for this course.