EPM

New Zealand Property Managers: Are you Up for A Challenge?

At the 2011 Real Estate Institute of New Zealand’s (REINZ) Annual Property Management Conference, Rockend CEO John Goddard challenged property managers to strive to reverse the 70:30 ratio between owner (DIY) managed and professionally managed properties, to get closer to Australia’s leading position of 20:80 in favour of professional property managers.

Goddard outlined the huge opportunity for NZ property professionals to grow their businesses by persuading DIY owners that a professional can manage their property better while minimising the risk of potential tenant issues.

It was generally agreed that the reasons for this significant market difference across the Tasman can be attributed to:

  • Australian property managers do not provide a ‘letting’ service to DIY managers and hence give away important agency skills
  • Many immigrants to NZ come from countries where DIY management is common, the UK being a prime example where many agencies provide letting services only
  • An Australian property investment culture, where fees, tax and other benefits are factored into the cost of owning an investment property
  • NZ professional property managers being untrained or unable to sell the benefits of professional management
  • NZ business owners not seeing the greater benefit of property management as a personal asset or cross-sales market opportunity for the business.

In August 2012, Rockend brought two of Australia’s most successful Business Development Managers (BDMs) to Hamilton, to participate in a panel discussion with an NZ BDM and present how our New Zealand colleagues can learn from Australia’s success. Despite the event occurring on the same day that the All Blacks played and won against the Wallabies in Sydney, the panel discussion was extremely well received, with Australia at least being able to boast that we are clearly winning when it comes to property management!

The panellists included Fraser Coombes of Ray White Hamilton, Tara Milzewski of Advantage One Real Estate, Hervey Bay, and Rebecca Clow from Rockend Perth. Tara and Rebecca are full time BDMs focused on growing rent rolls. In each of their best years they added between 200 and 270 properties to their rent roll by their effort alone. Fraser is typical of many senior NZ property managers who have business development as a part of their job and, as expected, the number of properties he has added is considerably less than the others. This early difference set a clear base for the discussion and it was evident that less than 10 per cent of the businesses present at the conference employed a full time BDM.

John Goddard led the panel through a series of themes, with audience input and participation along the way. To conclude the session four members of the audience presented a summary of the main lessons and conclusions for the attendees to take away.

In their summary they concluded:

  • To grow a rent roll organically you must employ full time BDMs
  • Good BDMs pay for themselves in three to four months
  • Few property managers have the selling skills or core attributes to be a successful BDM
  • Property management BDMs need to work closely with the agency sales team to leverage cross-sell opportunities
  • Casual letting in NZ should be minimised or stopped
  • BDMs should be trained like a top performing sales agent
  • There is huge potential for NZ agents to grow their rent roll if they are prepared to invest in BDMs and sell the benefits of professional management

As part of the challenge in 2011, Rockend committed funding towards the campaign to develop marketing materials for both consumers and agencies, presenting the benefits of professional property management. These materials are currently being finalised by the REINZ property management focus group for distribution in the next few months. NZ agencies should look out for these useful tools and focus on bringing their results and success to the 2012 conference to see how far they have come.

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John Goddard

John Goddard is the former CEO of Rockend since 2004. He is personally committed to life-long learning and encourages all Rockend staff to take control of their personal development, both through work and personal learning.