The range of remuneration depends on the Manager's duties. It also depends on whether the Agreement is a "do" Agreement or a "supervisory" Agreement. Under a "do" Agreement the manager must undertake all tasks within the complex that a Caretaker/Manager would undertake, down to changing light bulbs and mopping the reception floor. With a "supervisory" Agreement the Manager will do very little and often nothing other than to supervise everyone else who carries out all the caretaking duties within the complex.

The range of remuneration is on average between $800 per lot per annum up to a high of approximately $1,500 per lot per annum and will depend on many factors. The Caretaking Agreement may provide for the Manager's remuneration to increase annually by a fixed %, the Consumer Price index or provide for whichever is higher.

Importantly, the remuneration from the Body Corporate is secure income; it is paid monthly, in arrears, on a nominated day of the month.

On average, the commission on rentals in a permanent let complex is 7-8% while in a holiday let complex the average commission is 12%. Of course, owners do not have to let their units; they can live in them or lock them up. If an owner chooses to use the Manager’s letting services the owner pays commission from the rental collected by the Manager.  You “pay yourself” at the end of each month.

Additional income is obtained from a variety of sources including fees for re-letting units in the case of a permanent let complex, maintenance work (within the individual units), linen hire, cleaning and tour sales in holiday buildings or gardening services for tenants in permanent let complexes.

The number of units in the letting pool, the occupancy rate, the age and condition of the complex will all have a bearing on the income potential from the letting business, as will your ability and desire to offer additional services.

All income derived from these businesses has a capital value and the business purchase price of the Management Rights sale will be determined by a multiple of net operating profit (currently ranging between 3.5 and 5 times on the Gold Coast). There is therefore no incentive to inaccurately disclose income or pocket any cash received.

In holiday letting businesses, the letting component is usually the greater component of the income, while in permanent complexes it is possible that the caretaking component is the greater.  Each business will be different with many different variables including the size of the complex, number of units in the letting pool and the duties required by the Caretaking Agreement.

As the value of the business component of the Management Rights purchase is determined as a multiple of net profit, there is little incentive to “hide” income and pocket it as cash.