Real estate agents push into strata management
Increasing numbers of real estate agents are looking to strata management as a means to diversify their income over coming years as the real estate market cools and demand for strata management increases in response to massive volumes of new unit and apartment stock which are expected to hit capital city markets over the next two years (Andrew Heaton, Sourceable).
Recently this has caused problems. Strata Choice managing director Scott Martin talked of cases in which his firm had taken over situations where real estate agencies had been in charge and had found leasing and strata activities mixed up on singular accounts. ‘Real estate agents also typically focus around sales and property management and do not always understand significant issues relating to strata’, Martin states in a Fairfax article. ‘These include the difference between common property and individual lots as well as some of the idiosyncrasies of strata legislation”, he says.
‘The attraction of strata from an agent’s perspective cannot be understated, especially in view of a cooling sentiment about prospects in real estate. Thanks to the current boom in apartment construction, around 230,000 new multi-residential units and apartments are likely to hit the market throughout 2016 and 2017 – a lot of dwellings whose owners will collectively require body corporate services” (Sourceable).
The problem is that whereas real estate leasing deals with individual properties, strata managers deal with areas of common property and must therefore understand how large systems and people interact together within a building. Strata managers require the skills to develop long-term relationships and must be experts in resolving conflicts between multiple parties. These skills might not be as well-developed in a traditional real estate setting.