In our last newsletter, we highlighted that we are in a period of a rental slump. With many tenants are breaking leases in order to purchase their own home.
The current rental climate means that when a property comes up for lease there will be less people in the market and a greater number of properties to choose from this is where you as an investor need to be armed with strategies to keep a good tenant.
If you look on realestate.com.au now, don’t be surprised to see extra incentives to attract prospective tenants. These include offers such as 2 week rent free period, iPads and numerous gift vouchers. It is very competitive. Although these incentives for the most part are being offered to tenants in the Unit and Apartment market some Estblished homes are feeling the ripple effect of this.
If you have good tenants it makes sense to try and ensure they renew their lease. So how do you keep good tenants?
Keeping a good tenant starts long before you send them the lease renewal. Retention of quality tenants must form part of your investment strategy, because good tenants will pay their rent on time, and look after your property. This in the long term is beneficial for your investment.
Below are Madi’s top 5 tips for keeping your tenant happy:
Have mutual respect –be fair and respect your tenants. This shows with the way you manage maintenance, repairs, inspections and rent reviews.
- Respond to any maintenance issues or requests – keep on top of any necessary repairs, you will be surprised how many tenants terminate a lease because an owner has failed to react to basic maintenance and the tenant gets fed-up with it.
- Have regular routine inspections – inspections mean that maintenance issues are kept on top of. This lessens the chance of any costly emergency call outs and in turn unhappy tenants. This also means your property is kept in a tip top condition.
- Maintain Market Rent – there is a balance between increasing your rent to increase your returns, but possibly compelling the tenant to consider other more affordable rental opportunities. This can cause potential vacancy which isn’t ideal. Setting the rent too low could attract tenants who may not look after your property. There will also come a time where you need to increase the rent. If it is a big rental increase, then you will likely lose your tenants. It is best to have small and manageable increases over time.
- Have a great Property Manager – this is such an important part of the equation. A good property manager will ensure the right tenant is found for your property and will establish a good working relationship with your tenant. They should allow plenty of notice for regular inspections, maintenance, repairs and lease renewals. In turn, you should also provide your property manager with authority to make important decisions on the spot.
When it comes time to lease renewal time, listen to your property manager. A good property manager should be honest with you and provide you insight to the current market trends and guide you if a rental adjustment is potentially achievable.
At Hot Property Management, we are currently renewing many leases to prevent vacancy, before any renegotiation takes place, we communicate with clients to explain the market trends and the current market rental for there specific property to then form a tenant retention strategy. At the moment we are seeing many clients holding steadfast at the current weekly rent, with the view to lock in the tenant for a new lease period. This allows the rental market time to recover. A solid weekly rent is better than no rent at all.
We also like to ensure that every tenancy agreement ends in a peak period (Jan/Feb or June/July). If your tenant is not renewing their lease, then this means we have a greater chance of finding a quality tenant and securing optimal rent.
Hopefully you are currently having these types of conversations with your property manager. They should certainly be keeping you up to date with the Brisbane rental market and developing a strategy with you.
If you are not having these conversations with your property manager it may be worthwhile changing.
If you would start developing a solid property management strategy around your investment Please call 07 3170 3760 or Email firstname.lastname@example.org