What’s a rent roll really worth? Demystifying valuations.
You’ve probably heard rent rolls get valued at “a multiple.” But what does that mean — and why do some rolls sell for much more than others?
Let’s break it down.
The Basics
A rent roll is usually valued as:
‘Annual management fee income × multiple = value’
So if a portfolio brings in $200,000 in fees and the multiple is 2.8, it’s worth roughly $560,000.
What Drives the Multiple Up (or Down):
Retention & stability: Long-term landlords and low churn mean higher multiples.
Fee structure: Higher, consistent management fees add value.
Property types: Well-managed, standard residential properties are usually valued higher than high-maintenance, niche properties.
Location: Strong rental markets can push multiples up.
Documentation & compliance: Clean paperwork keeps buyers (and lenders) happy.
Hidden Value (or Traps) to Watch:
⚠ Discounts & freebies: Lots of discounted management fees? That lowers your true income.
⚠ Big landlords: If one client owns 30% of the roll, losing them can hurt your bottom line.
⚠ Arrears: A high level of unpaid rent can signal bigger issues.
Pro tip: Always do your homework (or bring in someone who will). The asking multiple is just the start — real value depends on the detail.
Need help?
Whether it’s working out what a roll is really worth or structuring finance to make the numbers stack up, we’re here to help you buy with confidence.
