The last article I wrote to you was in June 2015, at the time Mandurah’s vacancy rate was at 3.25% and there were 505 properties available for rent in Mandurah and Surrounding areas. As I write there are currently 864 properties available and the current vacancy rate is 6.4%.
Why has this blown out? It is a combination of several related events that have transpired. All time low interest rates are allowing people to borrow money to purchase their own homes, large releases of house/land packages, a large down turn in the West Australian Mining Boom and a downturn in migration.
It is now more important than ever to TRUST your Property Manager. Our team is geared up now more than ever to be armed with the research and knowledge to get your property leased quicker and keep you own personal vacancy down.
The table below shows that the rise in the number of rental properties in Mandurah in the last 12 months has risen by 31.7%, which gives us a very low ebb in demand and a rise in supply, this combined is putting downward pressure on rental returns.
Table Source : Core Logic
Here are some points and strategies that will help you generate more income by reducing your vacancy rate.
- Standout Marketing– Investing in professional photographs is a great way to attract attention. With so many options for tenants, they are looking for reasons to exclude your property – Photos with poor lighting, out of focus or incomplete rooms do not scream RENT ME! The photos should be valid for 5 years and at a cost of around $100 (tax claimable), it acts as an insurance policy for faster leasing turnaround.
- See your property through the eyes of a tenant– This is a multi faceted aspect of leasing that is often overlooked by several owners. What aspects will draw people in? What will turn people off? Are you competitively priced? Solving this can be as simple as a few minor cosmetic touch ups or a price adjustment. It is amazing what a fresh coat of neutral paint can do to boost your appeal. Remember: Any money spent on improvements can be claimed as deductions in your next tax return.
- For Lease Signs– These are useful for 2 main reasons. It increases the level of awareness of your property both from people actively seeking accommodation as well as those who may want to move closer to a friend, family member, work place or school. It also helps people attending viewings find the property.
- Tax Depreciation Schedule– This is the gift that keeps giving! A professional report that itemizes all the wear and tear on your investment property and its fixtures and fittings. It is not uncommon for owners to receive upwards of $5,000 year on year come tax time. The report will cost around $650 (again tax claimable) and lasts for up to 40 years.
- Appoint a PRO ACTIVE agent – when choosing your agency ensure they have a full time leasing manager who is solely responsible for ensuring they find the right tenants for your property.
- Listen to your Property Managers Advice – Your property manager is working in the rental market day in day out, they will offer the best advice and are highly trained and skilled to ensure that we manage your risk of vacancy to increase your return on investment.
While this might feel all doom and gloom we are still witnessing a high amount of foot traffic on our websites and to our open homes, the key is to get the property positioned right in this highly price sensitive market place and secure great tenants! That is our only goal for you.
So far this month we have leased 32 properties, this is a combination of our landlords listening to our advice and our property management team working extremely hard to get applications.
In the coming week or 2 one of our Senior Leadership members will give you a call if your property is vacant and we will together come up with a solution.
You can read the full Core Logic report on Rentals Nationally here: