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Management Rights Explained
 


What are Management Rights?
Have you ever thought of getting out of the rat-race? Living in the Sunshine State of Queensland, Australia and owning a business, where your hours are flexible, the bank will lend you around 60% of the purchase price, and you can earn 20%-25% on your business investment?If the answer is "yes" to these questions, then you should look at Management Rights - but, what are they?


What Are Management Rights?

Management Rights (sometimes referred to as Management and Letting Rights, or M.L.R.) are a form of business enterprise. These businesses have been around for over 25 years, and are found mainly in Queensland, but increasingly in NSW.

Back in the early 1970’s, national and international property developers "discovered" Queensland. Now, our skyline is dotted with residential and holiday resort complexes, apartment complexes, townhouse / villa developments, and tourist facilities. Behind the doors of most of these, exists a Management Rights business.

The developers of these complexes realized that there was an advantage in having an on-site manager, who would look after the day to day running of the complex, as well as provide a Letting Management service to absentee investor owners.

In Queensland, the evolution of this concept led to State Government legislation to formalise and control the industry, thus offering legal safeguards to unit owners, Bodies Corporate, and Resident Unit Managers alike.

Essentially, a Management Rights business involves the owner of the business enjoying a contractual agreement with the Body Corporate (see Definitions), of a multi-unit complex to supply certain services, in exchange for a salary --- and the right to earn further commission and services income from individual owners in the complex.

The second part of the deal is that, simultaneously with purchasing the Management Rights business, the Resident Unit Manager purchases the designated "Manager's Unit" in the complex. It is from this unit that the Manager runs the business. You can see from this arrangement, that the Manager has a vested and financial interest in the successful performance of the complex. If he/she neglects things that should be done, and the complex becomes "run-down", the Manager's property would also be devalued.

Many people regard Management Rights as the ultimate "Home-Based Business", offering lifestyle, excellent return on investment and good re-sale potential.


How Does The Manager Earn Income?

There are normally two parts to the On-site Manager's duties and two major parts to the Manager's income.

1. Body Corporate Salary:

 

In all multi-unit complexes, there are areas such as pathways, gardens, pools, tennis courts, etc which make up what is called Common Property.

The Body Corporate pays the Manager a salary, monthly in arrears, to maintain the Common Property, see that the By-Laws are adhered to, and report on any matters pertaining to the complex. If you wish, you may think of it as a caretaker's salary.

The Body Corporate also pays for all the day-to-day expenses of looking after the common property. Such things as mower fuel & repairs, pool chemicals & fertiliser are expenses for the Body Corporate, not the Manager. Usually all the necessary equipment is owned by the Body Corporate, and provided for the use of the Onsite Property Manager.

The Body Corporate salary is usually indexed to the CPI, to allow for automatic annual increases.

2. Letting Commission Income:

The Manager has the right to act as on-site Letting Agent for investor owners wishing to rent their units to tenants. You are paid commission and management fees by the individual unit owners for securing good tenants, accounting for the rent, and ensuring that the rental property is kept in good condition.

Other sources of income for the Manager include repairs and maintenance for landlords, cleaning charges, monthly statement fees. In holiday complexes you can earn a substantial additional income from such additional areas as; room cleans after each guest books out, linen hire, telephone and Internet usage, sporting equipment hire and tour and hire car bookings.

Do I Need any Special Qualifications?

To legally operate the Letting business, you will need to obtain a Restricted Letting Agent's Licence. This is nowhere near as difficult to obtain as a full Real Estate Agent's Licence, and involves the study of 6 subjects through a registered training organization (RTO) such as Property Training Queensland, Australian Property College, REIQ or a local Queensland TAFE. These subjects are generally undertaken in a classroom environment, however some RTO’s offer courses “on line”  or by correspondence. Go to Events and Training Dates for more information or contact us via "Feedback" to obtain the latest information on these courses.

The questions and answers on this page should give you a broad overview of the structure of the Management Rights Industry. For more detailed information go to the FAQ section or email your specific enquiry to us via the Contacts section.









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© Queensland Management Rights Sales Pty Ltd. ABN: 29768420528. Disclaimer: The figures and information displayed on this website are supplied by the owner of the Management Rights Business. While RAAS RIGHTS staff make every endeavour to ensure their accuracy, they usually do not have access to full sets of accounts or legal documentation for verification purposes. Accordingly parties should make their own investigations as to the accuracy of these figures and information