5 Things a Buyer Should Look For When Purchasing a Rent Roll?

When purchasing a rent roll, a buyer should take into consideration:

  1. Their borrowing capacity.
  2. The employment of staff in their agency and their capacity to handle more managements.
  3. Can a new additional of a rent roll be absorbed into the current business or will their rent roll department need to growth – factoring in additional expenses and management issues.
  4. The statistics of the rent roll being purchased:
    1. Is it in the same demographics of the current rent roll?
    2. Is the average weekly rent like their current portfolio? Will it reduce the buyers overall weekly rent, or will it enhance it?
    3. Is the average commission low or high or like the buyers rent roll?
    4. What is the current vacancy rate?
    5. What is the current arrears rate?  
    6. What is the property to landlord ratio? Is it high?  
  5. Purchasing Costs.  The buyer should make enquiries and understand that there are costs involved to purchase a rent roll this includes:
    1. Finance Costs
    2. Accountancy Costs
    3. Solicitor Costs
    4. Valuation Expenses
    5. Rent Roll Due Diligence Expenses

All these factors above should be considered before purchasing a rent roll.

More Business & Real Estate Insights