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BWT
Associate of
the Bob Walters Team
Associate member of LPMA
LPMA 2002 Forum

LPMX Annual Forum
Your Rental Department- An Investment Well Worth It!

 
The Property Management Industry is an exciting one. Rental departments have so much to offer the average real estate business and can provide so many benefits.
 
However principals today tend to overlook all that a rental department can do for them, and do not focus on growing and maximising these benefits.
 
So what are some of these benefits:
  • A Re-occurring Monthly Income- we don’t even need to tax invoice our income each month- we are paid automatically when we pay our clients their monthly rental income!
  • Stability of Income- your monthly fee income can be generally predictable- this is great for budgeting!
  • Reliable Listing Source- if your clients are happy with your property management service- they will most probably ask you to sell their property as well!
  • Tenants Buy Property- if we look after our tenants as valued customers- we will have a flow of purchase enquiries from a source under our very nose!
  • Asset Worth- the rent roll can be used as borrowing power at the bank for a loan! 
  • Sale Value- here in Adelaide (like most cities and regional areas in Australia), rent rolls are purchased quickly. There is not enough supply for the demand of mainly principals wanting to prop up their overall business with reoccurring income. Any rent roll with a solid and consistent fee structure should sell at a good price. Rent rolls commonly sell for big sums of money- even in the multi-millions of dollars for the bigger rent rolls.

So why do Principals not invest themselves?

So if this is true- why do principals overall not invest energy and capital in building such a valuable asset? Why dont they recognise real worth in their rent roll? Why not invest in systems, training, coaching, growing and maximising their fee income and make the best of this opportunity for wealth?
 
Unfortunately a large portion of principals do not prioritise their rental department investment as they come from a sales background, and therefore their knowledge, focus, energy and effort is generally aimed at their zone of familiarity- their sales department. Meanwhile, their rental department survives with the mission statement of ‘out of mind, out of sight’! Their department monthly fee income, when received, is sometimes the only indication that their department personnel are still alive and breathing! Otherwise there is little to no involvement or interest.

Is it more than a dream?
 
It is my dream that one day the rental department will be of equal importance to the principal as that of the sales department. The rental department is promoted with the same profile, offered the same window space, offered the same office working environment conditions and salaries run much higher than current remuneration levels.
 
The rental department has so much to offer anyone who wishes to make a goldmine from it. Invest in your rental department and you will receive a rich and fruitful reward!
 
Darren Hunter- darrenhunter.com
National Property Management Trainer, Speaker and Consultant
Mobile- 0403 379924

 




 

 
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