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Managed App (Managed), a direct and automated rental payments platform, has doubled transactions in just over one year.
The business surpassed $2 billion in total transaction volume in June 2023, up from $1 billion in total transaction volume in April 2022, as previously reported by REB.
Transaction volume includes the receipt and remittance of rental income from tenants to landlords plus payments to third-party stakeholders, including tradespeople.
The platform has seen a surge in activity over the past 12 months with a raft of new agencies switching from trust accounting-based property management software to more efficient, cost-effective and client-focused payments technology, Managed’s head of sales Matthew Wilson said.
At its core, Managed is a direct and automated payment gateway that offers the real estate industry a fast and secure way to transact payments to all stakeholders, including tradespeople for work orders and maintenance, landlords, and property managers.
Achieving $2 billion in transactions is a milestone that reflects the significant growth Managed has experienced over the last year, Mr Wilson said.
“The real estate market has seen a radical correction with rising interest rates impacting residential real estate sales as well as a recalibration of the rental market,” he said.
According to Mr Wilson, his team has seen an unprecedented level of enquiry from property management agencies across Australia due to market conditions.
“Real estate is cyclical and as sales slow, agencies look to their rent roll as a critical source of income and growth,” he said.
“The rental market is running hot at the moment. Rental values are rapidly rising and look set to increase further as landlords seek to offset the rising costs of holding property, with mortgage rates at a 15-year high.”
“We are experiencing a host of enquiries from department heads and property managers that want to run a more efficient operation – to give more time to their team to look after the interest of landlords and tenants, rather than being bogged down in trust accounting administration and other payment tasks that can be automated,” Mr Wilson said.
“Agencies want to present a better proposition to their landlords, who are demanding instant access to their rental income. This is a major advantage our agencies can offer, particularly when cash flow is such a critical consideration for landlords.”
He wondered “why would a landlord want their rental income sitting in a trust account for up to 30 days when it can be in their bank account?”
“Every dollar of that rental income should be deposited in an offset account connected to a mortgage when it is paid – and that’s what landlords now expect. Agencies that can’t deliver on this expectation will risk losing managements to agencies that can,” Mr Wilson added.
While the upside for landlords was clear, Wilson said agencies can also benefit from a valuable new revenue stream via the Managed revenue share model.
“This allows agencies to share the income generated from tradespeople facilitating work orders and maintenance via Managed.”
“On average, an investment property will undertake two to three repairs, maintenance, or capital improvement jobs each year, facilitated by tradespeople with payments processed via the Managed platform. This can be a positive revenue-generating engine for agencies that are on the revenue share model; there is also no subscription fees for these agencies,” he concluded.
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