Investors who insist on the highest rent the market will bear often end up with a greater level of vacancy once tenants have time to make comparisons and find a better value option.<\/p>\n
\u201cThe key to both negligible vacancy and tenant harmony is setting rent at 95 percent of market value,\u201d Bellarine Property managing director Christian Bartley said.<\/p>\n
\u201cAt the end of the year, even a few weeks\u2019 vacancy usually means a lower net income than if rent had been set at 95 percent.<\/p>\n
\u201cInvestors whose properties are good value get more inquiry and can afford to be more selective when deciding who will rent their property.\u201d<\/p>\n
According to Mr Bartley, references are crucial when developing a tenant profile but the bottom line criterion is: do you believe they would be able to pay X dollars per week for Y weeks?<\/p>\n
\u201cAn investor\u2019s managing agent is the person with the expertise to advise on the tenant\u2019s ability to meet their lease obligations.<\/p>\n
\u201cBut many novice investors don\u2019t know what to ask of their managing agent.<\/p>\n
\u201cIf you can tell them upfront what your needs are, it\u2019s much easier to keep abreast of what\u2019s happening and avoid confusion.\u201d<\/p>\n
He said a managing agent should provide a monthly statement of all income and expenses with cheques banked directly into investors\u2019 accounts.<\/p>\n
\u201cAsk for an annual written report of state of repair (internal and external) and cleanliness as well as a mid-year written kerbside report of state of repair and cleanliness.<\/p>\n
\u201cYou should also receive a six-monthly written report of the rental value and the local area vacancy rate and an annual written report of the reasonable selling price of your property.<\/p>\n
\u201cLandlords should carry out an internal inspection of the property themselves once every two years so that they can visualise its state of wear and tear when maintenance and repairs are discussed.\u201d<\/p>\n
Mr Bartley said it would take investors three to six months to get to know their agent and how he or she operates.<\/p>\n
\u201cUntil then, require all expense items to be referred to you (other than emergencies) prior to the agent spending any money.<\/p>\n
\u201cAfter the initial period, set a limit on the amount the agent can spend (usually about the equivalent of one week\u2019s rent) without reference to you.\u201d<\/p>\n
As with any contractual arrangement, investors should always have their agreement with their agent evidenced in writing.<\/p>\n
\u201cIt sounds obvious but it\u2019s amazing how many people don\u2019t think of it,\u201d Mr Bartley said.<\/p>\n
\u201cAny business arrangement is more likely to be plain sailing if both parties have their rights and obligations clearly delineated.\u201d<\/p>\n
For more information, phone Christian Bartley on 0410 695 325, email christian@bellarineproperty.com.au or head to bellarineproperty.com.au.<\/p>\n","protected":false},"excerpt":{"rendered":"
Investors who insist on the highest rent the market will bear often end up with a greater level of vacancy once tenants have time to make comparisons and find a better value option. \u201cThe key to both negligible vacancy and tenant harmony is setting rent at 95 percent of market value,\u201d Bellarine Property managing director […]<\/p>\n