When it comes to long-term rental rolls, you can’t look beyond management rights as the most effective way of serving the interests of unit owners and tenants.
Resident managers have an intricate understanding of the property, and they know the renters and buyers in the marketplace. However, just because you have paid fairly for a management rights business, it doesn’t mean your rent roll is ever secure.
Around 40 per cent of Australians currently live in Community Title Schemes – many of which are managed by resident managers – and this number is estimated to rise to 65 per cent by 2025.
The nature of management rights as a business puts operators in pole position to capitalise on this growth. However, they still need to protect themselves against the threat of external real estate agents and the loss of asset value or ‘leakage’.
Defending and growing the letting pool is the single biggest difference to business cash flow and capital gain for management rights operators. In order to protect it, it is their responsibility to do everything within their power to demonstrate to owners that they are the most viable option for managing or selling their investment.
Like any industry, specialists add value and resident managers have all the skills and experience of a real estate business but with the added knowledge of the property.
ARAMA’s Long Stay Resident Manager of the Year, Michael Mitchell, sums up the situation nicely when talking about what makes a successful resident manager. “You have to become a subject matter expert on your complex, on property management and on property sales in the area,” he says.
Not only do successful management rights operators understand the local market, they also have strategies to navigate the impact of other real estate agents on your existing and potential customers.
It is highly likely that external agents know and are in contact with your unit owners – and they deploy a variety of tactics to remain visible and top of mind in order to win over their business.
However, as a resident manager you are the best authority on their property within the market and you need to demonstrate this on a daily basis. You sit on the committee, understand legislation and requirements, the processes, and know what renters and buyers are seeking in the marketplace.
The more you share information with your owners and anticipate their needs, the more you will empower them with the confidence that there is no-one better positioned than you to protect and manage their investment.
Regular communication with owners also means having a strong idea of when properties are likely to be selling in order to pre-empt any influence of external agents.
If you haven’t got a strategy in place to strengthen your rent roll, now is the time to do something about it – and fortunately we all participate in an industry in which help is only a phone call away.