Hiring a part time RE agent. Advice?

Discussion in 'Property Experts' started by NHG, 10th Aug, 2018.

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  1. NHG

    NHG Well-Known Member

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    Hey Team PC.

    I'm at a point where it i starting to make sense for me to bring on a part-time/full-time REA between a mate and I.

    I've been looking at award wages etc, however my question is more along the lines of, how did you structure it, did you also have a RE licence, what were the conditions, what issues have come up managing them, what qualities have you found most suitable for an agent, etc.

    Just starting to look now, so bare with my lack of specific knowledge of the industry.

    Thanks for any and all advice.
     
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    What would you be hiring one for? Property management?
     
  3. JacM

    JacM VIC Buyer's Agent - Melbourne, Geelong, Ballarat Business Member

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    Are you a Real Estate Agency yourself? Or are either yourself and your partner fully licensed?
     
  4. DaveM

    DaveM Well-Known Member

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    Is this to manage only properties you both own?
     
  5. JacM

    JacM VIC Buyer's Agent - Melbourne, Geelong, Ballarat Business Member

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    If you are not fully licensed you won't be able to employ someone with an "Agent's Representative" certificate to perform real estate functions.

    If you are not licensed yourself there will be some issues relating to employing a fully licensed person depending on what job functions you want them to perform. First and foremost, insurance would be a problem.
     
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  6. Scott No Mates

    Scott No Mates Well-Known Member

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    If the person is employed ie not a contractor, there is no need to have any qualifications whatsoever provided the person is working directly for the owner not as an agent.

    There is no obligation for an owner to comply with the PSBAA NSW (or other state's act) as they are not acting in the capacity of agent but as owner's employee.

    A non-licensed person cannot open a real estate statutory trust account nor can they work as an agent without the supervision of a fully licensed agent.

    That is how organisations can manage their own property transactions. Often this function falls to the accounts department or some equally property unqualified person.
     
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  7. JacM

    JacM VIC Buyer's Agent - Melbourne, Geelong, Ballarat Business Member

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    Yes but not to act as an agent (eg property manager) for clients/customers. Only for one's own portfio.
     
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  8. Scott No Mates

    Scott No Mates Well-Known Member

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    Agreed
     
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  9. D.T.

    D.T. Specialist Property Manager Business Member

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    How many properties are we talking about here?
     
  10. Scott No Mates

    Scott No Mates Well-Known Member

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    Or $$ of rent (You'd need at least $1m rent to justify paying award rates to achieve 5% management fee - prorated). You'd be better off paying a retainer to an agency.
     
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  11. gty12

    gty12 Well-Known Member

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    Don't worry everyone I'm sure eventually NHG will reply haha, and then we can have a much better idea of what he wnats.
     
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  12. Phantom

    Phantom Well-Known Member

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    How did you go with this?
     
  13. NHG

    NHG Well-Known Member

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    @JacM @Scott No Mates @George Poullos @HenryF @D.T. @Terry_w

    Hey,

    Didn't get notifications there were responses. Thanks for getting back to me.

    1. (Romantic) partner and I are getting our RE licences as per the advice of my accountant. - I already have a business with a licenced agent, however I am choosing not to partner with this person for further ventures at this point.

    2. The properties managed will be ours, however... we don't have all that many and the manager can manage other peoples properties also. My personal current rental turnover is $300k+ which will be over $500k by June 2019.

    The person I was planning on doing with this has a similar turnover, and already has his licence, and other items mentioned further below. However I am still unsure whether I will JV as I've had unfavorable experiences thus far in this regard.

    3. I will take on other properties. This will be a boutique business, so at this point I won't be mass advertising, and have a specific niche I am focusing on. So no need to watch out for my sales pitch on this forum :D

    Reasons for this is to grow a rental roll which has a value, subsidize my own management, and because it is a logical next step. It is being set-up as a completely separate business. My portfolio will be a client.

    4. I have spoken with several of the RE agents I have dealings with and have been given some pretty good advice. Looking to bring someone on part time by June 2019.

    There's a suggested award wage, and usually a car allowance is included in the package. It was actually less than what I was planning on paying.

    5. Apart from licences, etc, I will also need to pay for trust setups as legislated, licencing for software to manage the properties, and insurances from my current understanding.

    Did that answer the questions? Please feel free to throw more at me.
    Can't believe it's been almost 2 months since I asked this question. Doesn't seem that long ago for once.
     
    Last edited: 3rd Oct, 2018
  14. D.T.

    D.T. Specialist Property Manager Business Member

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    These 2 things combined sound like you're looking to open a PM agency. Having done so myself I can advise you on some of the costs you're going to be up for in private if you like. However based on your above numbers I'm not sure its going to be worthwhile for you unless there's some additional reason you're trying to play this angle?
     
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  15. Scott No Mates

    Scott No Mates Well-Known Member

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    Monthly subscription to realestate.com.au/domain.com.au/homespictorial.com.au, tica, RP data etc, website.
     
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  16. gty12

    gty12 Well-Known Member

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    He replied!
     
  17. NHG

    NHG Well-Known Member

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    Spoke with @D.T.
    (Really appreciate your advice).

    Actually very relevant to what I was looking for, though won't be ready for it till about June. Will update properly sometime next year.

    Essentially similar to what @Scott No Mates stated, to cover costs, you generally require a high rental turnover.

    My advantages are my profit margins are much higher, no office overhead, and not looking for a salary from the business as I can keep my current job.

    The main advantage is it will free up my time to work on-the-business, rather than in-the-business which has a high % cash-on-cash return rate.

    Thanks to all that replied.
     
  18. gty12

    gty12 Well-Known Member

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    Did this line of thinking come from the E-Myth book?
     
  19. NHG

    NHG Well-Known Member

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    No, haven't read that book.
    Line of thinking came from mentors, and own experiences.

    Why's that? Is it a good book? What's your business btw? Any advice on hiring staff?
     
    Last edited: 4th Oct, 2018