Build-to-rent provides property managers in regional areas with the opportunity to expand their rent rolls but they need to be well prepared.

The Move to More and Regional Living campaigns, the relative ‘COVID safety’ of regional areas and the appeal of living somewhere quiet while still being able to log into a city-based workplace is seeing regional centres on the cusp of a boom. 

In NSW, areas like Byron Bay exploded in population numbers as city-dwellers relocated during COVID. The same has happened in many other parts of the country. 

However, the shift in population presents a challenge for local real estate agents and property managers. An influx of people means an influx of demand for homes to rent and buy. 

One of the ways this demand will be mitigated is a rise in build-to-rent developers. 

What is build-to-rent?

This term describes a strata development where the properties are leased by the developer rather than sold.  

When developers have the potential to receive consistent rental income rather than attempting to sell apartments, they can be more favourable candidates for loans. The stable revenue gives the banks confidence (depending on the demand in the area).

In opposition to build-to-rent, ‘build-to-buy’ describes the traditional model where units are sold off the plan or once completed. 

NOTE: Build-to-rent is not to be confused with the ‘built-rent-retire’ scheme which recently came under fire for offering owners a home to live in for life but failed to deliver on the promise, leaving investors in the scheme potentially without a home to live in. 

What this means for property managers

Having a partnership with a build-to-rent developer is an easy win for a real estate agency looking to grow its rent roll. However, in regional areas, the challenge will be to meet the sudden rise in property numbers. 

As property managers know, there is a limit to the number of properties an individual can manage on their own. Instead of a one-person-show, a team will be required. 

Linking with a build-to-rent developer provides an excellent opportunity to tap into the shifting population and grow your team. Bringing on new property managers will increase footprint and revenue. To minimise the cost, consider having one or more team members ‘on the ground’ and building an administrative team offshore. This allows you to create jobs in your area without dramatically sacrificing your profit margins. 

Tips for expanding your team

If you take on a build-to-rent client with dozens of apartments to lease, you will need to be well prepared and have the right people in place to manage the workload. 

Attracting talent is as important as attracting clients. Start contributing some of your marketing efforts to promoting the excellent working conditions and work/life balance your agency provides. You need to become the most sought after agency for PMs. Having a good social media and marketing presence will make a difference to this. 

You can also tap into relocation incentives. For example, job seekers can access government funding if they relocate for a regional job. Remind people of this in your advertising so they know they won’t be out of pocket because of their move. 

Start preparing processes and systems. When you’re on your own, you have a way of working which you don’t have to communicate to other people. However, you will need to find a way to share it across a team. Create an intranet using Google Sites, make explainer videos using Loom and create checklists for incoming team members. Consider which digital platforms you will use to keep track of data and make everyone’s life easier. 

Don’t forget to hire for attitude and ‘soft skills’ such as tenacity and approachability as well as experience. If you can find someone who is motivated and excited to learn about the industry, you can train them to be an efficient part of the team. This can sometimes be easier than finding someone who is qualified but not aligned with the values of your brand. 

Start talking to local developers today to build your relationship and let them know you’re one of the best local candidates to add their properties to your rent roll. 

BDH Solutions are rent-roll agents with over 40 years experience in connecting the right vendor with the right purchaser. Download our information booklet on the new Victorian Minimum Living Standards Legislation