What Principals Can Do to Maximise Rent Rolls in a Tight Market
You know the score. Times are a bit crazy. Residential properties are selling but with owner-occupiers dominating the market, rental properties are drying up and putting pressure on rent rolls. As owner of RE/MAX Ignite in Riverhills and RE/MAX Profile Real Estate in Bardon, Roxanne Workman values a holistic agency approach to managing relations with landlords.
Read on to discover how Roxanne advocates the power of relationships to help grow the value of your rent roll and to maximise your chances of achieving sales through it.
Build relationships with landlords
Roxanne built an initial rent roll from nothing to 160 properties in just under four years and then used the equity in that to buy another one. Her philosophy? Make sure you can service and maintain both without dropping the ball, especially in a market where listings are few.
“You’ve got to have that personal approach,” Roxanne says. “My husband Adam and I are the face of the business and our property managers, sales agents and administration staff are our clients. We want to give them our best tools possible. We’ve also got our landlords, sellers, buyers and tenants as well.
“When I bought the new rent roll, I phoned over 90 landlords on a Sunday to explain who I was and what I did. I wanted to start off on a good footing with them. As a business owner, I wanted them to know I worked every day and that I would be there for them.”
Roxanne followed that with an introductory email and then video messages featuring herself, Adam and the property managers, including a Christmas message.
The power of a market appraisal
Once the retention period on her rent roll purchase had passed, Roxanne approached all her landlords to see if they wanted a comparative market appraisal done. She received 150 appraisal requests in response.
“We got 10 listings out of that project,” Roxanne says. “But it was mainly for landlords on my new rent roll to know that I’m a selling principal and that I have sales agents in the office who are able to help them.
“Just before June, I’ll be going out to my entire rent roll to see if they want a sale appraisal again. It will be different than what it was all those months ago because the market has changed and they might be pleasantly surprised and go ‘wow, I can pay off the rest of my house if I can sell my investment’.”
Roxanne has introduced another step in this process. If a property manager brings in a rental property just before the tenants are due to renew or are giving notice, she asks an agent to contact the landlord and see if they would like an updated appraisal on their property.
“It ensures we’ve got touchpoints along the way,” she says.
As part of keeping her relationship with landlords strong, Roxanne will do a rental appraisal three months before the rental comes out of its lease, or if the tenants are going to re-sign, to find out where the property is sitting in the market.
“We’ll advise the owner to adjust it accordingly depending on market trends,” she says.
Roxanne is also a believer in professional photography for two reasons – to attract a better quality of tenant and to ready a property for market should the owner decide to sell. When signing up a new property for lease, she’ll obtain professional photographs for advertising purposes, often with the owner’s belongings still in it.
“I get a better standard of clientele who goes into the property, the property moves more quickly and the tenant goes in quicker. And if that landlord needs to put that property on the market for any reason, I don’t need to access the property again for professional photos or to deal with the tenant. I’ve already got the images and they’re paid for by the owner.”
She is also a fan of Matterport, which creates immersive 3D images as though you are actually standing in a place. This allows her staff to do 3D entry and exit condition reports on rental properties, keeping tenants accountable and once again giving the owners another way of professionally presenting the property should they decide to sell.
The current state of play
Roxanne sums it up: “There’s a low vacancy rate and not a lot of stock. For a real estate agent at the moment, and especially a principal, it’s a perfect storm.
“For people who are investors who have their properties on the market – they may have had their properties for 10 or 12 years and they may not have done a lot with them. They’re putting them out on the market now and they’re getting good money because people are paying it.
“So we are selling from our rent roll but we’re also having agents out there from other brands who are prospecting against our rent roll, which is definitely a smart thing for them to do. That’s where a principal has to ensure that our landlords know what we do and what service we offer and we have to build that relationship.
“Just because you manage their property doesn’t give them first right of refusal for the sale. You have to prove your worth, especially with your rent roll and your landlords.”