Scott's Weekly Column

Overpricing rental properties

The rental market is like any market and is affected by supply and demand.

When there is a shortage of rental property available then rents tend to rise however if demand slows and less tenants are looking then rents can fall. I’ve met many investors over the years who fail to recognise this and will never reduce their rental and will sit with a vacant property until they find someone willing to pay what they are asking for.

If you are an investor I believe you should always seek the best possible tenant rather than hold on for every last cent. My reasons for this are:-

1)    Good tenants with great references tend to have choices of which property they can rent, it may be worthwhile reducing the rent by a small amount just to secure them

2)    Good tenants with stable jobs tend to stay longer

3)    A longer tenancy means less turnover costs and less vacancies.

4)    Good tenants will treat your property as their own if they feel they are on a very fair rent, they will tend to minor repairs as they recognise it is a give and take relationship. 

5)    A tenant who feels they are being squeezed for every last cent will not attend to minor repairs and will report every small problem and expect everything to be perfect and attended to immediately.

6)    If they feel they are being squeezed then as soon as their lease is up and they find a better value property then they tend to move on.

If you’re looking for advice on your rental property then why not pick up the phone and talk to our award winning property management team today. Our advice is free but a bad tenant could cost you $$$thousands!