This is such an important bit of advice that we have risked repeating ourselves to try and reinforce it. (I think it gets about 6 mentions in various parts of the site.) It is not self serving advice however, it is indisputably the best advice on the whole web site. So if you take nothing else away from the site, PLEASE take note of this:
"ONLY EVER USE PROFESSIONALS WHO HAVE AN INTIMATE KNOWLEDGE OF THE MANAGEMENT RIGHTS INDUSTRY." |
|
By Professionals we mean:
- SPECIALIST MANAGEMENT RIGHTS BROKERS
- SPECIALIST MANAGEMENT RIGHTS FINANCIERS
- SPECIALIST MANAGEMENT RIGHTS ACCOUNTANTS
- SPECIALIST MANAGEMENT RIGHTS LAWYERS.
|
SPECIALIST BROKERS. Some agencies dabble in management rights and some, such as RAAS RIGHTS, specialize in this niche field. Management Rights brokers have specialist knowledge about those parts of the Property Agents and Motor Dealers Act for instance that relates specifically to the management rights industry. RAAS RIGHTS maintains a database of prior complexes that have sold. As there is no central registry of management rights sales as exists for units, a RAAS RIGHTS sales person will be able to inform you of recent sales of similar complexes. Over and above this they are aware of industry trends and have broad knowledge of the finance, legal and accountancy issues that buyers and sellers are likely to face.
|
SPECIALIST FINANCIERS. As with brokers, some banks and finance brokers specialize in the field and some do not. To make matters more complicated some banks do but have specialist divisions that handle matters. Unfortunately this does not stop some local managers trying to do the business themselves. If your bank lends on management rights make sure you get a referral to the dedicated management rights arm within that bank. Specialist financiers are aware of prevailing industry lending ratios such as the loan to valuation ratio and the loan to income ratio.
|
SPECIALIST ACCOUNTANTS. Management Rights Industry Accountants are aware of a number of relevant issues such as:
- The need to ensure all Appointments to Act are in place.
- The definition of Net Income as required in the contract to be verefied.
- Industry standard outgoings for expenses that can be distorted due to an owners individual family circumstance. e.g. A manager with 3 teenage daughters may have a massive phone bill, however the accountant would only provide for the ndustry standard telephone expense to be applied.
- What income items are deemed to be excesive and not capable of being replicated each year.
|
SPECIALIST LAWYERS. Lawyers who specialize in management rights will have a detailed knowledge and understanding of:
- The standard standard provisions that should be included (or excluded) from Caretaking and Letting Agreements.
- The renewal provisions in these agreements and whether all options have been exercised.
- How to remedy matters if the two items above are not to their satisfaction.
- The PAMDA and BCCM Acts as they apply to the management rights industry.
|
|
