EX­CLU­SIVE IN­TER­VIEW WITH RENT.COM.AU CEO MARK WOSCHNAK

THE RE­CENT ASX list­ing for Rent.com.au Ltd (RENT) has pro­pelled the com­pany into a dy­namic phase of growth as it moves a step closer to its goal of be­com­ing the ‘Home for Renters in Aus­tralia’. CEO and Founder Mark Woschnak shares some in­sights into the c

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Rent.com.au has just listed on the Aus­tralian Se­cu­ri­ties Ex­change (ASX). What op­por­tu­ni­ties does this list­ing pro­vide for you, and for the prop­erty man­age­ment in­dus­try in Aus­tralia?

The list­ing rep­re­sents a sig­nif­i­cant mile­stone in that it en­ables us to take the next step to­wards achiev­ing our vi­sion of be­com­ing the ‘Home for Renters’ in Aus­tralia. Our list­ing in June, and the as­so­ci­ated cap­i­tal rais­ing, re­flects pro­gres­sive and sus­tained growth over the past seven years and con­sol­i­dates our mar­ket-lead­ing po­si­tion in the ded­i­cated na­tional rental sec­tor.

Since the com­mence­ment of oper­a­tions in 2007, we’ve fo­cused solely on the rental mar­ket and have been driven by the strong belief that the rental mar­ket in Aus­tralia is un­der-ser­viced. The rent­ing pop­u­la­tion of Aus­tralia is go­ing to con­tinue to in­crease and the busi­ness is strate­gi­cally poised to move di­rectly into this dy­namic growth phase.

Hav­ing now built the IT, in­fra­struc­ture, prod­uct ser­vice and mo­bile plat­forms re­quired, we can now shift our fo­cus to­wards a com­mer­cial phase and cre­ate a house­hold con­sumer brand that adds value at a broader com­mu­nity level.

To date, our level of na­tional traf­fic has pro­vided strong en­quiries and re­sults for agents in many ar­eas, but a very low re­sponse in oth­ers. This was a func­tion of our growth and we now look for­ward to rais­ing our brand aware­ness and in­creas­ing the level of en­quiries across the na­tion, tar­get­ing over 500,000 unique visi­tors monthly over the next year, and over one mil­lion in time. This is just renters, of course, not home­buy­ers. Our goal is to lever­age our online po­si­tion to de­liver con­sis­tently a high vol­ume of timely and rel­e­vant renter and land­lord leads to all prop­erty man­agers who use our site.

The team at RENT is pas­sion­ate and com­mit­ted to this unique op­por­tu­nity. The new cap­i­tal also al­lows us to re­spond im­me­di­ately to mar­ket needs by em­ploy­ing around 30 more staff mem­bers to de­liver a broader range of prod­ucts and ser­vices, and pro­vide even more cus­tomer ser­vice to prop­erty man­agers and the wider com­mu­nity.

We look for­ward to work­ing with all in­dus­try par­tic­i­pants to make a pos­i­tive and sus­tain­able dif­fer­ence to the Aus­tralian prop­erty man­age­ment in­dus­try. How are you cre­at­ing the rental mar­ket­place? Look­ing at global bench­marks, we see that cre­at­ing a ‘mar­ket­place of rentals’ is cru­cial to pro­vid­ing renters with a first-class search ser­vice with the widest pos­si­ble range of rentals via agent and pri­vate land­lord list­ings.

We’ve grown sub­stan­tially over the past six months alone, with over 6,150 in­di­vid­ual agen­cies reg­is­tered to rent. com.au (rep­re­sent­ing ap­prox­i­mately 80 per cent of all agent rental list­ings na­tion­ally). This growth means that nearly 30 per cent of all renters in Aus­tralia used rent.com.au over the past fi­nan­cial year to help find their rental prop­erty.

Through the pro­vi­sion of com­pre­hen­sive in­for­ma­tion and in­no­va­tive ser­vice so­lu­tions, such as our new mo­bile re­spon­sive de­sign, plus add-on ser­vices like Ren­tCheck and unique Ren­tBond prod­ucts, we are con­stantly im­prov­ing the level of ex­cel­lence and search ex­pe­ri­ence for renters.

What growth do you see in rentals? We think the rental in­dus­try is ex­tremely un­der-ser­viced rel­a­tive to the prop­erty-for-sale en­vi­ron­ment. This alone pro­vides a great op­por­tu­nity for im­prove­ment, but we be­lieve that the most sig­nif­i­cant growth in rentals will come from the sheer vol­ume and shift of the cur­rent 30 per cent of the pop­u­la­tion who cur­rently rent to a much higher per­cent­age of the mar­ket, and this is start­ing now.

Many com­men­ta­tors, gov­ern­ment and other sta­tis­ti­cal agen­cies sug­gest that our cap­i­tal cities are likely to fol­low the trend of most other ma­jor cap­i­tal cities in the world, whereby 50 per cent or more of the pop­u­la­tion rent, and that we could reach these fig­ures within a decade.

While the av­er­age In Aus­tralia is about 30 per cent across the na­tion, this trend is al­ready ev­i­denced by many of our cap­i­tal cities, es­pe­cially Dar­win at 47 per cent, Syd­ney at 35 per cent and Bris­bane at 34 per cent. We see this is a grow­ing trend, with the other cap­i­tal cities fol­low­ing suit over time.

This cur­rent and forecast growth is not just due to hous­ing af­ford­abil­ity is­sues, but be­cause rent­ing is be­com­ing a con­scious lifestyle and in­vest­ment choice by many and work trends are chang­ing, with our sur­veys show­ing an in­creas­ing per­cent­age of renters who have no de­sire to own a prop­erty.

“RENT­ING IS BE­COM­ING A CON­SCIOUS LIFESTYLE AND IN­VEST­MENT CHOICE, WITH OUR SUR­VEYS SHOW­ING AN IN­CREAS­ING PER­CENT­AGE OF RENTERS WHO HAVE NO DE­SIRE TO OWN A PROP­ERTY.”

What does this mean for prop­erty man­agers?

As the first ASX-listed prop­erty por­tal ded­i­cated solely to prop­erty man­age­ment, we see a lot of growth ahead and a great op­por­tu­nity to part­ner with the agent in­dus­try to pro­vide bet­ter ser­vices and more knowl­edge to prop­erty man­agers.

The type of renter growth an­tic­i­pated means that there will be a sig­nif­i­cant and in­creas­ing em­pha­sis on rental mar­ket­ing, rental ser­vices, rent rolls and fo­cus on prop­erty in­vestors in the years ahead. This is the be­gin­ning of a sig­nif­i­cant, long-term growth phase for the prop­erty man­age­ment pro­fes­sion.

As the process of man­ag­ing a rental be­comes more reg­u­lated, we see enor­mous op­por­tu­nity for prop­erty man­agers to tar­get and con­vert the ‘non-agent man­aged’ rental mar­ket share of ap­prox­i­mately 46 per cent to ‘agency man­aged’. This doesn’t just in­clude a typ­i­cal pri­vate land­lord, but also the other non-agent prop­erty own­ers such as cor­po­rates, builders/de­vel­op­ers, char­ity groups and gov­ern­ment agen­cies, who will re­quire in­creas­ing lev­els of prop­erty man­age­ment ser­vices.

RENT al­lows all prop­erty man­agers to ben­e­fit, as it of­fers a free list­ings ser­vice as well as the op­por­tu­nity to take up a range of paid sub­scrip­tion ser­vices which pro­vide greater ben­e­fits. Many of our ser­vices are pro­vided on a ‘first-in ba­sis’, so now is a very good time to sub­scribe to RENT as we gear up for our ex­pan­sion ob­jec­tives.

Our mar­ket­place at rent.com.au not only pro­vides bet­ter let­ting re­sults to a wider and unique au­di­ence of renters (about 50 per cent of whom do not go to REA or Do­main), but also to agents, with huge op­por­tu­ni­ties to mar­ket their pro­fes­sional ser­vices to this large non-agent mar­ket share, rep­re­sent­ing ap­prox­i­mately 1.2 mil­lion rental prop­er­ties. We de­liver a range of lo­calised ser­vices that pro­vide agents with busi­ness de­vel­op­ment op­por­tu­ni­ties and leads from pri­vate land­lords look­ing to ap­point a prop­erty man­ager.

What are the ben­e­fits for prop­erty man­age­ment busi­nesses to use a por­tal which is ded­i­cated only to prop­erty man­age­ment?

The most sig­nif­i­cant ben­e­fit for the in­dus­try comes out of our pure fo­cus on rentals. This al­lows us to look deeper into the pro­cesses, from a whole of mar­ket view­point, and work proac­tively to cre­ate in­no­va­tive so­lu­tions and pro­vide bet­ter prod­ucts and ser­vices for prop­erty man­agers.

We ac­tively work with fran­chise groups, in­de­pen­dents, train­ers, ed­u­ca­tors, soft­ware and prod­uct sup­pli­ers to en­sure that the fo­cus of prop­erty man­age­ment con­tin­ues to the lev­els it de­serves.

By cre­at­ing a por­tal that fo­cuses solely on the rental process, we can elim­i­nate time­wast­ing and frus­tra­tion ex­pe­ri­enced by renters and more ac­cu­rately ad­dress their needs and those of the wider in­dus­try.

For prop­erty man­agers, we are acutely aware of pro­vid­ing ex­cel­lent value for money, and this is rep­re­sented in our low pric­ing model, sub­scrip­tion pack­ages, list­ing up­grades and re­ports. An ex­am­ple in­cludes our ‘Ren­tBond’ prod­uct that al­lows renters to have their bond paid up­front to agents, and up to six months to pay it off with­out any de­posit paid or in­ter­est charged.

As we sig­nif­i­cantly in­crease our mar­ket­ing and brand­ing of the site by cre­at­ing this cen­tral mar­ket­place, we can fa­cil­i­tate greater economies of scale for prop­erty man­agers in get­ting en­quiries and ser­vices at lower costs.

What are some of the add-on ser­vices that rent.com.au will be pro­vid­ing in the next 12 months?

We will con­tinue to fo­cus on build­ing the mar­ket­place for renters, prop­erty man­agers and pri­vate land­lords. We have iden­ti­fied dozens of new ser­vices that we are work­ing on, in­clud­ing quotes for ser­vices that renters need when mov­ing, such as clean­ing, re­movals, stor­age and in­sur­ance.

For prop­erty man­agers, the next range of ad­di­tional ser­vices re­lates to bet­ter qual­i­fi­ca­tion of renters, in­spec­tion ser­vices, eas­ier ap­praisals and more con­nec­tiv­ity with af­ter-let­ting func­tions such as util­i­ties con­nec­tions. There is also a world­wide trend to­wards the use of much more video in all as­pects of prop­erty man­age­ment, and we aim to pro­vide our first range of these ser­vices.

What are some of your other goals for rent.com.au in the next 12 months?

Our most im­por­tant goal is to raise the aware­ness of RENT and to tar­get over 500,000 renters to the site ev­ery month. In de­vel­op­ing and fa­cil­i­tat­ing the fast growth of the www.rent.com.au mar­ket­place, we will be us­ing our other sup­port­ing as­sets of rental­prop­erty.com.au, prop­er­ty­man­ager.com.au and lease.com.au, and are in the process of re­de­vel­op­ing these.

There are some an­a­lysts say­ing it’s pos­si­ble that rent.com.au could be the next realestate.com.au. What are your thoughts on that?

We have a clear and sole fo­cus on rentals and have no plans to be­come a gen­eral por­tal or prop­erty-for-sale por­tal. We don’t see our­selves as com­pe­ti­tion to REA or Do­main; in­stead, we will fo­cus on the un­der-ser­viced rental sec­tor, and there­fore rep­re­sent an im­por­tant com­ple­men­tary ad­di­tion to the online mar­ket­ing mix for any agent. The busi­ness of rent­ing is very dif­fer­ent to that of prop­erty for sale, with dif­fer­ent func­tions, dif­fer­ent ser­vices, tim­ing and de­mo­graphic au­di­ences. The size and scale of REA is enor­mous and very suc­cess­ful in the sec­tor they op­er­ate in, so we are not mak­ing di­rect com­par­isons of our busi­ness against REA or any other.

Our fo­cus will con­tinue to be on con­sumer brand­ing and the qual­ity and depth of ser­vices in the rent­ing mar­ket­place for the ben­e­fit of all par­tic­i­pants.

Can agents be a part of the ASX list­ing op­por­tu­nity?

Many agency prin­ci­pals, prop­erty man­agers and in­dus­try ser­vice providers have asked us this ques­tion. The an­swer is yes, and many have in­vested al­ready as share­hold­ers.

Any­one can buy shares via a bro­ker and we think now is a good time to in­vest be­cause the busi­ness is at the be­gin­ning of its mar­ket­ing and prod­uct de­vel­op­ment growth phase. As a busi­ness that is solely fo­cused on the prop­erty man­age­ment in­dus­try, many in­vestors from the in­dus­try take com­fort in this be­cause they un­der­stand the mar­ket, and know first­hand the op­por­tu­nity that lies ahead.

OUR FO­CUS WILL CON­TINUE TO BE ON CON­SUMER BRAND­ING AND THE QUAL­ITY AND DEPTH OF SER­VICES IN THE RENT­ING MAR­KET­PLACE FOR THE BEN­E­FIT OF ALL PAR­TIC­I­PANTS.

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