Fire under the roof in Crowdhouse: This company is in the crosshairs due to the horror of additional costs

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Property manager Crowdhouse has a fire under its roof: Tenants of two apartment buildings in Huttwil BE have to pay additional costs of 143,000 francs. But residents have great doubts about the accuracy of the invoice and are dragging Crowdhouse before the rent arbitration authority. The tenants’ spokesman, Christoph Buchmann (50), told Blick that in the worst-case scenario, a lawsuit would be filed against the property manager.

Crowdhouse is also in the spotlight on television. On Tuesday evening, the SRF consumer program “Kassenrutsch” covers the tenant uprising in Huttwil and questions the company’s business model. The Zurich-based property manager is getting more attention than anyone wanted. The company has become accustomed to being in the spotlight and has put itself on the big stage.

With the founding of Crowdhouse in 2015, an entirely new player suddenly emerged in the real estate industry otherwise not known for innovation: a fintech company dedicated to nothing more than the democratization of real estate investing.

Investors do not need to pay for the entire flats, but will be able to purchase shares of an investment property for 100,000 francs, according to the promise. On its website, Crowdhouse advertises properties it manages with returns on equity of 5, 6 or 7 percent.

The company itself makes its money from agency fees and administrative work. Crowdhouse itself manages most of the properties it brokers.

IPO canceled, no need for property management

The excitement was great, especially in the first few years. The two co-founders, Robert Plantak, 36, and Ardian Gjeloshi, 40, were overwhelmed with interview requests. They even planned an IPO but then canceled it.

Growth figures fall behind our forecasts. The company states that it has completed a total of $2 billion in real estate transactions since 2015. But crowdfunding has largely faded away. Individual investors are now involved in more than half of purchases. The fintech in the orbit of Zurich’s business elite has turned into a fragile real estate company with administrative affairs. And the board seems to have had little time for management over the years.

Huttwil residents aren’t the only ones having a hard time with crowd management. Tenants repeatedly complain about paying outrageous additional charges, incorrectly issued bills, and finding silent lines when they want to complain to management. Negative entries are also increasing in Google reviews.

Along with Huttwil, Crowdhouse also manages apartment buildings in a village where one in seven apartments was vacant a few years ago. Even today the vacancy rate is over 4.3 percent. Tenants therefore accuse the management of luring residents with seemingly low rents and inflating the bill by making additional demands.

Is Crowdhouse overwhelmed with management?

One of the most criticized points: Additional requests sometimes arrive in the mailbox years later. Actually, no for professional management. Is Crowdhouse overwhelmed when it comes to determining payments on account and billing additional costs? The company defends itself against Blick by saying “No”. People are aware of the need to adjust payments on the account.

Crowdhouse vehemently denies that they relied on fraudulent quotes or falsely invoiced Blick. It is stated that criticism of administrative work has been voiced many times in the media and the problem is constantly addressed. And: “The relevant negligence led to significant process optimizations internally. As a result of this optimization, many responsible people were dismissed, including the former head of department.”

It’s a radical step for a company that denies being overwhelmed by property management and is trying to solve it with more management and external support. It is a result of this processing that some tenants have received bulk statements for several years. However, this does not meet our quality expectations. Crowdhouse promises to evolve in the future. Crowdhouse tenants aren’t buying it right now.

Source :Blick