What are Management Rights? -
Published: 30 August 2006.
Management rights is the business of on site caretaking and letting of units or townhouse complexes.
You might want to buy management rights for a range of reasons:
- The lifestyle interests you
- It suits you to buy a business and a home in one
- The return on investment is above average compared to other owner operator businesses.
But first, what exactly are "management rights"?
When developers build units or townhouse complexes of a reasonable size, it makes sense for the developer to provide for the long term caretaking of the common property (like the gardens and the pool) and for there to be an on site letting service for owners who might want to let their property.
These arrangements are called management rights.
It makes sense for the developer to create management rights because he or she then has an asset to sell, sometimes for quite substantial sums.
It also makes for more harmonious living within the complex if the management rights are well set up. The common property will be looked after and the on site manager should be able to handle tenants and rent collection better than an outside agent.
Because you will be collecting rent for people you will need a special form of real estate agent's licence to own and operate management rights. This is called a restricted letting agent's licence.
Because the licence only permits you to collect rent from within your complex, it is much easier to obtain than a full real estate agent's licence.
A restricted letting agent's licence for management rights is not difficult to obtain. While it does involve completing six modules of the Real Estate Agent's Course, we will be able to provide you with assistance to complete these modules. They may be completed either by correspondence or by attending a course.
