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Urgent regulation required on minimum management fees

Urgent regulation required on minimum management fees

by Elyse Perrau 0 comments

A business development manager has said a minimum management fee needs to be put in place to protect property managers' jobs, or we risk killing off the industry.

The comment follows a warning on the detrimental impact discounting fees can have on a property management businesses.

United Realty Cecil Hills BDM Tina Pink said her business  has done everything “professionally possible” to increase awareness of the value of service over cheap-rate management fees.

"However, at the end of the day, without that regulation on a minimum management fee, it is going to kill the industry,” she told Residential Property Manager.

“[It has] been highlighted strongly about keeping a stand and not dropping your fees, but that is easily done in the eastern suburbs, inner west and the inner city. Out west we are up against the Asian market and a lot of the new Australians who like to barter."

"They are not interested in what your management can provide for them, whether it be an extra inspection or a drop in other fees; they are really only interested in the bottom line, which is the commission," she added.

Ms Pink said she tries to educate her landlords by explaining she can’t drop her fees any lower than five per cent.

“Even at five per cent I say to them, 'Look, if I break that down it is a cup of coffee a day'. People pay more for their coffee every morning than they do for their management, and that is pretty sad they don’t see it like that,” she said.

Ms Pink said setting legislation around minimum management fees is the only way to move forward.

“It will keep everybody fed instead of having a lot of agencies closing down because they just cannot afford to manage the four per cents,” she said.  

“It is not just to benefit my office; competition is good, and we can’t serve everybody obviously."

“At the end of the day, we are not trying to eliminate any of our competitors, but to make it a fair playing field for all, regulation needs to be put in place for a minimum fee." 

Urgent regulation required on minimum management fees
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