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Can you live off site?

By Frank Higginson04 Oct 2010

This is a question we get asked fairly regularly. The answer comes from two areas:

Your management rights agreements

You may also need to review how you own the management rights business. You might own the business in your own names. You could own it as a company. You might be a trust which has either an individual or a corporate trustee. Some agreements provide that where a company or trust owns a management rights business that a director or beneficiary needs to reside on site. Some don’t.

THIS COMPONENT OF THE ARTICLE IS NO LONGER RELEVANT 

Each management rights agreement is different. Some distinguish between personal obligations and obligations that can be performed by employees or contractors.

There is also a potential impact on your ownership situation. You might own the business in your own names or as a company or a trust could have ownership with individual or corporate trustees. Some agreements provide that where a company owns a management rights business that a director needs to reside on site. Some don’t.

Whichever situation you are in, there is no hard and fast rule when it comes to management rights agreements. Each one needs to be looked at alone.

No matter what though – if it says you must reside on site, that is where the off site residence question ends unless the agreement is amended.

Licencing

Under the Property Agents and Motor Dealers Act 2000 (PAMDA) a resident letting agent who:

  • has the approval of the body corporate to let lots (via a letting agreement);
  • has completed the required education modules; and
  • who resides on site,

can operate under a resident letting agents licence.

If you operate under a resident letting agents licence and no one resides on site with a licence, you are in breach of the PAMDA. For example:

  • if you work the business during the day and leave the unit unused at night; and
  • if you work the business during the day and then leave a night manager in the unit who is not licenced.

The only way around this is to get a full licence, or get a sales persons licence under a full licence. To do otherwise is to flirt with danger with the Office of Fair Trading.

The above comments relating to licencing only apply to the extent that you let lots for owners. If you do not run a letting pool, your only issue is the ability to move offsite under the caretaking agreement.