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Staff Reporter
A majority of agents have no intention of purchasing a rent roll over the coming year, new research has found.
According to a recent Real Estate Business straw poll, 53 per cent of agents have said they will not purchase a rent roll over the coming 12 months.
Of the 332 respondents, 47 per cent of agents said they would contemplate buying a rent roll.
Leading Property Managers of Australia director Bob Walters said many agencies preferred to grow their business organically as rent rolls have the potential to be quite expensive.
“When buying a rent roll, you are talking about it being a substantial financial investment,” he said.
“For example in a middle income area of Sydney, you will probably be paying up to 3.5 to 4 times the annual management fee income. That translates on average rents for each property you buy to probably to a $5,000 cost per property.”
But while Mr Walters said the majority of agents preferred to implement an organic growth strategy, he said there were hidden costs associated with this growth plan as well.
“Organic growth is the inexpensive way to grow but it usually the snail pace way, unless of course you throw a lot of money and resources at it.”
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