Most property investors aim to have a low vacancy rate and reduced time between tenants. So to find new tenants quickly, avoid these two common mistakes; setting the asking rent too high and the property doesn’t present as well as it should.
1. The asking rent is set too high.
You need to check in with your property manager who will be able to advise the rent you’re likely to achieve in the current rental market. Rental prices change from time to time, they move up and move down.
In the current rental market where there is an oversupply of properties, we suggest you set the rent at market or slightly below market rent. Our property managers in Sydney are often asked by our investor clients, what is the reasoning for setting a rent below market rent. The advice is that the property will appear good value to prospective tenants and likely result in a higher number of parties inspecting the property which should mean that you have more applications to select.
If the rent is set too high, then inspection numbers are likely to be lower or you could attract prospective tenants that have been not approved on other properties and you could only have one application on your the property. As time goes on and the property remains vacant and you will have to reduce the rent to find a suitable tenant.
Avoid this mistake and ensure you set the rent in line with market from the start.
2. The property doesn’t present well and requires updating.
As an investor, it’s easy just to lease the property as is without making any improvements.This approach can work in a rental market where the supply of properties is low, however in the current rental market there is an oversupply of rental properties and this approach is unlikely to work unless you reduce the asking rent.
At the moment prospective tenants are focusing on properties that are updated, modern or renovated. So if your property needs work and you don’t make any improvements, then you have to expect a longer vacancy period. Our property managers report that investors say “let’s give it a go and see what happens”, so what ends up happening is after 3-4 weeks of the property been vacant, then a decision to reduce the rent is made or we are advised to arrange for some minor improvements to the property.
So when your tenant gives notice set up an appointment to view the property and assess to see if any improvements are required before commencing advertising the property.
Avoid this mistake and take action before the property becomes vacant.
Our office can undertake basic improvements however if you’re looking for further improvements then we have formed a business relationship with Siobhan from Perfect Plan Project Management. Mention Local Agency Co. for a complimentary free assessment. Click here —> PERFECT PLAN WEBSITE.
Our boutique responsive office is very active and we are finding good tenants for our clients and generally leasing properties properties quicker than the current average days on market.
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