The management rights business is a business with a home model. It has been around for decades and is most popular in Queensland. But what are its advantages?
Management with a Personal Stake
Commercial businesses can always hire managers. With management rights, the manager has a personal stake in the business. As the manager, you purchase the management unit of a building and take up property management duties. You receive a salary plus commissions depending on arrangements with other property owners, explains Resort Brokers Australia.
Why the Personal Stake?
Because you own a unit, you have vested interest in keeping the property well-maintained and profitable. If the value of the complex drops, so does the value of your unit. In addition, a run-down complex will attract less custom and you stand to lose your entire investment.
Taking Care of Business
The business part of the cost is typically a multiple of the annual net profit. Lenders are willing to loan up to 70% of this value and there is no particular skill requirement for it. Most management rights for sale are in resort areas such as Sunshine Coast in Queensland though the business model has also spread out to NSW as well as the rest of the states and territories.
Your responsibilities include caretaking tasks such as cleanliness, maintenance, and security. Your salary comes from the Body Corporate of the property, which depends on the size and number of units. If the project is big enough, this salary can allow you to hire additional staff. While you aren’t required to actually do the work a qualified professional would do, you are still required to supervise such tasks and report to the unit owners the results.
Extra Income and Benefits
By obtaining the permission of other unit owners in the complex, you may offer their units for both short- and long-term lease. Short-term leases have the advantage of being more profitable however, long-term leases have the advantage of stability.
The management rights business has flexible hours but it can also be taxing. However, it is a business that affords you less personal risk and whatever you learn from it, you can easily apply to future investments and businesses.