Bold property managers have been given an innovative way to stand out from the crowd.
Auction Services director Rob Trovato told Residential Property Manager agencies should seriously consider rental auctions as a way to differentiate service and maximise landlords’ returns.
Mr Trovato said that would overcome the habit some property managers have of being quick to settle for a ‘comfortable’ rental amount.
“Instead, you could put the tenants against each other and try and maximise the outcome, because $10 a week more for a landlord, that is $520 a year extra in their pocket,” he said.
Mr Trovato said he can see rental auctions becoming a common part of the property management space in the future – and Fair Trading NSW confirmed to Residential Property Manager that it would be legal in his home market of Sydney.
“If I was an owner of a business and I wanted to show my clients that I am doing everything possible to maximise their outcomes, then this is a point of difference that would achieve that,” he said.
Mr Trovato said rental auctions would be especially successful in high-demand areas where the landlord paid a premium to purchase an investment.
“It could also be a good way for the agent to differentiate themselves from the rest of the market and win more managements that way,” he said.
“It is a good way to look at growing your portfolio.”
Mr Trovato said rental auctions would also benefit tenants by making the property search more transparent.
“Say there is a small family looking at a two-bedroom unit and they’ve been unfairly dismissed on a lot of properties because they have a family.
“It becomes a transparent way to say, ‘Here is your chance, put your best foot forward and win it’.”
Mr Trovato said a tenant’s financial background and rental history would need to be checked before a rental auction was to take place.
“In sales, the agent doesn’t need to go into the financials for a sale property – the buyer assumes all those risks,” he said.
“In the rental side of things, before the person should qualify for the auction, they would need to demonstrate that they have a good rental history.”