Does the length of time of properties managed on a rent roll influence value?

Over the past few months we have had a number of real estate agents looking to sell their rent rolls. Their primary question is- how much do you think the rent roll is worth?

One needs to consider a number of factors in valuing rent rolls; not the least the length of time each property has been managed by the agency.  A rent roll that has only been operational for a few years isn’t considered a mature rent roll, not having built good loyalty with the clients of the rent roll.

Generally speaking, these property owners are first time or new investors who invariably have geared their investment and are influenced by the economic conditions, vacancies and level of commission & fees charged. If the property is vacant for a few weeks the agent could find the listing is vulnerable and those property owners leaving to go to another agency.

That said, rent rolls with this profile and dynamic are worth less than a rent roll where property owners have been with the agency and built a relationship with the agency over time.  The value of rent rolls that have a mature client base is more valuable than those without.