What we are experiencing in the residential rental market at the moment is applicants been approved by agents and investors very quickly.
There are 2 main reasons for this is occurring;
- We are experiencing an oversupply of rental properties and the highest vacancy factor we have seen in about 5 years
- Investors have financial/mortgage commitments and can’t afford to have their property vacant for too long
As a result what is happening is that agents and investors are becoming desperate and will just go ahead with the first party that applies for the property. In some instances agents and investors are not checking/processing the applications in a diligent manner.
So what needs to happen is:
- Give the applicant a time frame for when they will have a response on their application
- Check the application thoroughly but at the same time process the application quicker
- Give a quick response to the applicant
Michael’s tips for this situation and to avoid missing out on good tenants!
- Respond to your agent quickly when they discuss applicants for your property
- If your agent has a history of selecting good tenants then give your agent authority to approve tenants without your approval. The agent can update you of the situation as soon as they can, however the number 1 priority is securing a suitable tenant.
- Suggest taking out some precautionary measures such as setting aside at least 1 month’s mortgage in a separate bank account to be able to handle any vacancy period, although 2 months would be better. Also consider taking out landlord insurance.
Our boutique responsive office is very active and we are finding suitable tenants and generally leasing well priced properties quicker than the current average days on market.