If your approach is to wait for the right market opportunity, when was the last time you reviewed the market? Or, do you increase the rent as the property becomes vacant and risk missing out on potential increases along the way?
Weighing up your options
So many things to weigh up. If you increase the rent when the tenant is paying on time, there are also risks associated… Often we hear property investors say it is better to keep a tenant at the current rent than risk not having a tenant at all. But there are ways to negotiate through this and it is certainly worth looking at the options.
At the time of appointing your property manager, one of your early discussions and consequent instructions should be for how the rent will be increased. Reviewing the market rent for the preceding 12 months against what is being achieved today will provide a forecast of what you can expect.
Your property manager can also guide you through the state legislation for the method and frequency of rent increases, which in some cases can be as many as twice per year. The opportunity comes down to the market and legislation, which we have the expertise to measure and implement on your behalf.
The one matter which possibly remains up for review, is the performance of the tenancy. Perhaps the condition of the property, garden or the good nature of the tenants is the priority for your investment strategy. Maybe this will be true for one tenancy and not the next which is why we should assess this together.
A relationship with your property manager can aid in your wealth creation strategy.
An early discussion to share your ambitions for the investment can provide the foundation to develop plans for maintenance, capital improvements and rent increases to offset these.
Kath Teasdale – Lead Property Manager – 0732831333