What are management rights

Management Rights

Management Rights is a business that gives the exclusive right to an individual or company to fulfil the role of Caretaker and also to operate a letting business (of units within the complex) on behalf of the lot owners within a scheme.Management rights building, body corporate, resident letting agent

The business usually requires the Manager to:

  • Live at the complex as a resident
  • Take care of common property on behalf of the Body Corporate
  • Let units in the complex on a rental basis as a letting Manager.

When you buy Management Rights you are buying the rights contained in contracts (Caretaking Agreements & Letting Agreements) to carry out a business in conjunction with the Body Corporate (the collective body of owners within the complex). These contracts differ from complex to complex.

Management rights building, body corporate, resident letting agentDepending on the complex, the type of letting will predominately be either:

Permanent (Long Term) Letting
Holiday (Short Term) Letting
Mixed (Short & Long Term) Letting

You can buy a Management Rights either from the developer (off the plan) or from an outgoing manager.

Each Management Rights usually includes:

The manager's Unit with an office (On Title) or
The right to occupy an office/reception area with exclusive use.
The necessary equipment to run the office and do the caretaking duties.

What are you Buying

In a management rights sale there can be up to three main components involved in the sale. Due to the wide variety and intrinsic nature of management rights businesses, these components vary in inclusions and complexity.

1. Caretaking agreement

The caretaking agreement forms part of the management rights agreement. This document details the duties, responsibilities, rights and obligations of the resident manager. These agreements can vary greatly, ranging from general agreements through to specific duties and task agreements. The role of the resident manager in a caretaking agreement can be personal or supervisory in nature or a mixture of both. The body corporate will pay the resident manager remuneration for the services rendered under this agreement. As some of the roles and responsibilities can be quite subjective, it is important to have a clear understanding of how they are put into action. Understanding and carrying out the roles with a caretaking agreement can result in a quality business.

2. Management agreement

The management agreement forms part of the management rights agreement. This document allows the resident manager to conduct a letting business exclusively within the CTS. This can include maintaining an office with office hours. This agreement does not exclude a lot owner’s right to let the property through an outside letting agent. However, the competitive advantages of onsite property management far outweigh those of any outside agency. Because of this, the vast majority of lot owners choose to use the services of the resident manager. Each lot owner choosing to use the resident manager to let their property within the community titles scheme will have a separate individual agreement known as an appointment to act PAMD 20a. A resident manager is remunerated for their letting services by each lot owner through the appointment to act.

3. Residential property, office & “Exclusive Use” areas

As part of the managements right business, you may be required to purchase a residential lot within the community titles scheme. There is an intrinsic link to the resident managers lot through both caretaking and management agreements. In some of these agreements, this gives the occupier of the said lot exclusive rights and access to body corporate areas and the business they conduct within the community titles scheme. This can incorporate such things as exclusive access to pool and garden sheds, pump rooms or more importantly, the exclusive right to conduct a letting business within the community titles scheme.


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