An increase in rental properties has seen the power shift to tenants.
Blogger: Richard Symes, CEO, Credit Repair Australia
If you are an investment property owner in Australia, you may be aware of the new figures released by SQM Research stating that the national vacancy rates for rentals is now at 2.2 per cent.
SQM General Manager Louis Christopher stated that it equates to 65,075 vacant properties in the market and “due to a genuine increase in rentals and not to any seasonal spike”.
This is a worrying trend for landlords as not only will the market become more competitive, but also make it harder to increase rent on renewing tenancy agreements. The forecast over the next two years is for the upward trend to continue, due to an ongoing increase in approvals of new developments.
Whilst Melbourne saw a decrease in the monthly vacancy rate, it remained the highest at 2.4 per cent. The other cities in top brackets were Brisbane, Canberra and sat at 2.3 per cent. At the other end of the scale, Darwin came in with the lowest rate amongst the metropolitan areas at 1.4 per cent, with Adelaide, Sydney and Hobart ranging from 1.6 per cent to 1.7 per cent.
SQM Research’s Asking Rate Index showed the average rent across all capital cities remained steady at $528 a week for houses and $416 a week for units.
Due to this shift in the market, it may be most effective to develop your current tenant relationships. Here’s my tips you may find handy when negotiating an extended lease.
1. Most tenants do not wish to relocate every 6-12 months – it’s expensive, stressful and takes up a lot of time. If you are proactive in dealing with repairs and issues quickly, this will work well in your favour
2. Consider signing a 12 month contract. If they are reluctant to do this, find out what their concerns are and try to address them. For example, if it’s security, perhaps installing an alarm system could ease their minds and mean they sign on longer term lease
3. Try to avoid unreasonable rent increases that will make tenants want to look elsewhere. Your investment property needs to work for you financially, but try to make sure it also works for the tenant. Good tenants can be hard to find!
About Richard Symes
Richard Symes is the CEO and founder of Credit Repair Australia, the leading provider of credit and debt solutions. Richard pioneered the credit restoration sector and developed Australia’s first credit restoration process over a decade ago, allowing Australians to have black marks completely removed from their credit report. In 1999 Richard also played a pivotal role in using new Australian laws to develop workable solutions for people struggling with debt. Known as Credit Repair Australia’s debt solutions, these options now allow Australians to pay back their debts at an amount that is affordable, which may not include interest or paying the full amount of what is owed.
“We are good at what we do because we believe in what we do. We enjoy helping people get their lives back, especially when they are affected by their credit rating. We built Credit Repair Australia with one purpose in mind, to get results that can give people back control of your life.”
For more information on Credit Repair Australia visit www.creditrepairaustralia.com