Sources of Income (2)
2. Letting fees and lease renewals.
As the on-site manager for the community scheme, the investor has the exclusive on-site lettings rights for leases within the complex.
Thus in the majority of cases, another large proportion of the revenues derived from the investment are the letting commissions.
In Queensland, rents are usually paid per fortnight. Letting commissions are distributed through the trust account to the service provider each month. Commissions usually range from 6-8% of rent. Lease terms are usually semi-annual. Renewal of lease commissions is usually half a week to one week’s rent. New lease commissions range from one week to two weeks’ rent as the fee for service.
For permanent complexes, whereby the complex is made for residential living (as compared to holiday / resort letting), the majority of income usually is derived from caretaking services with letting accounting for another 20-40% of the income.
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