How Many People Choose to Self-Manage Their Property in Australia?
Ever wondered how many people in Australia self-manage their own property, or why they choose to do it?
We are often asked ‘How big is the market for self-managing landlords in Australia?’ or “Why do people choose to self-manage their own property?’
The good news is that it’s a pretty big market in Australia, and you are absolutely not alone when considering this option. There are some fairly rational reasons why so many people choose to self-manage and we see customers downloading our ‘switch kit’ on a regular basis to make the change.
To cut to the chase, in this blog we’ll aim to answer both of these questions.
How big is the market for self-managing landlords in Australia?
We typically answer this question by using government statistics provided available through the Australian Tax Office. Every few years they do a deep dive into the statistics of individuals submitting an Australian tax return.
If you go into the core stats and look at individuals who claim rental income on their tax return, and the percentage who claim agents fees as part of their deductions, you will find that between 25% to 28% of individuals claiming rental income on their tax returns do not claim agent fees.
From that we can derive the number of individuals in Australia self-managing their properties.
Of the approximately 2 million landlords claiming rental income, a whopping 25% do not claim agent fees, which suggests about 500,000 landlords in Australia are self-managing their property. Huge! Not too different from the rise of self-managed super funds (SMSFs) over the past 20 years.
To take that a step further, in 2020 realestate.com.au conducted research into private landlords and those who are currently self-managing. Their study concluded that a whopping 33% of the Australian landlord market was already self-managing.
What are the drivers and why do people choose to self-manage their own property?
Why are more and more people choosing to self manage their own property and switch from their agent? What is driving the change? We typically describe two key factors driving the change:
The first is technology and a general trend and shift in consumer behaviour. Whilst covid and lock-downs accelerated a lot of online and e-commerce businesses, over the past 20 years a lot of traditional activities and businesses have moved online.
Not only is technology making significant advances, it is enabling us to do the things we have always done manually in an automated way. This is an amazing development in efficiency, but it also means we start to think about more than just saving money or just finding an alternative, but we look for a better experience.
That experience does not just have to be better for only the landlord, it can also be better for tenants too. We find this regularly across the features we offer on the platform - whether it’s Condition Reports, Lease Agreements or Tracking Payments. A platform like RentBetter can provide a real advantage, particularly as interest rates and general costs are rising.
We offer a better experience and you can save money. What more could you want!
The second factor relates to trust. If you look at the Roy Morgan survey on image of professions and the perception of different industries, you typically get an insight into how consumers feel. Nurses and doctors, as you would expect, score really well in the survey as people really trust and like them.
Teachers naturally also score well in terms of helping the future of our society grow and develop. When you go towards the lower ranks, at the bottom you see ‘car sales person’ and real estate agents and property managers sit right in above them.
In over 20 years that this survey has been run, real estate agents have not really come off bottom or second bottom spot. The trust ‘deficit’ is a major contributor to people self-managing their own properties, as they have simply had enough of paying for a service they do not feel meets their expectations.
It’s common sense, when people aren’t happy they start to vote with their feet.
In conclusion, there are a significant number of self-managing landlords in the Australian rental market, and that number is growing based on alternative solutions that provide a better experience and that can bridge the trust gap that has been created by the traditional property management model.
We receive more and more landlords requests each day asking about how they can switch from their agent and we’d love to help you too!
Customers Also Asked...
How many Australians own multiple properties?
Reviewing the ATO statistics from the 2019-20 tax year, the data suggests:
- 15m individuals in Australia submitted a tax return
- 2.2m (15%) claimed rental income as part of their tax returns and are assumed to be landlords
- 1.98m (90%) of the 2.2m landlords have one or two investment properties
- 0.22m (10%) of the 2.2m landlords have more than two investment properties
Should I manage my own property?
You’re on the RentBetter website, so the answer is always going to be yes! Managing your own investment can be rewarding both personally and financially. Ultimately you will be looking after your own investment and who cares more about that than you do?
You can manage the expenses and therefore the return of the property and using a platform like RentBetter will ensure you enjoy the experience while you are doing it!
We have recorded a workshop series and posted a number of blogs where you can read and watch more about why self managing a property is beneficial
How do I self manage my own property?
You’ve come to the right place to answer that question. We offer a broad range of tools and technology to help you through the process. Whether you’re searching for a new tenant or you want to set-up a tenancy, or you already have a tenant in your property, the RentBetter Platform can help you through the process.
We typically look at managing a property as a lifecycle with many entry points rather than a single linear process. You can read more about the 5 steps for self-managing your property or register for a demo to check it out yourself
