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Rental properties - a great investment

 

When reviewing rents and tenancy agreements, the question often arises “Should the rent be increased and if so, by how much?”

When asked this question, as your property managers we always consider the following:

Is the tenant looking after your property and paying the rent?

Assuming the answer is ‘yes’, we then proceed in completing a comparative market analysis of your property to assess the price the property would rent for on the current market.  This is the price that could comfortably be achieved if your tenant decided to vacate at the end of their tenancy.

The booming Mackay economy, driven by the mining industry, coupled with an acute shortage of accommodation means that competition for rental properties is high, fully furnished being the most requested.  This has placed upward pressure on rental prices and as a result property owners are receiving excellent value for money.

We have developed strong relationships with a number of companies connected with the mining industry and have already placed a number of senior executives into accommodation.  We believe these are the ideal tenants; mature-aged with high-paying, steady jobs in a booming industry.

The most common tenancies range from three to six months, although it is not uncommon for them to want another agreement at conclusion of their lease.  However, a longer lease with a reliable tenant is also a great option for obvious reasons.

It is advisable that you keep your property looking good!  If it is in need of a paint job, furniture needs updating or repairs are outstanding, it is well worth your while to consider doing this as the need arises. It is much more economical to add improvement in small quantities, rather than leaving it and trying to do a major overhaul at a later date.

Nobody can predict what is going to happen with our economy in the future but according to local reports, Mackay is currently looking strong as is its future.  Media reports mentioning words like ‘recession’, ‘carbon tax’ etc do undoubtedly affect the choices being made by our customers, however, to date our rentals are still exceptionally sound.  (September 2011)

The Benefits Of On-Site Management

Taken from the Arama Website: Australian Resident Accommodation Managers Association

Consider the following:

  • The manager lives on-site and knows your building intimately
  • The manager has a vested interest in having the building fully occupied
  • The manager is usually mature enough to deal with “life problems” with tenants should they arise
  • Economies of scale with the purchasing of materials are also available to be passed on to the investors
  • A real estate agent’s main focus is on selling property. An on-site manager has a core business of letting units and consequently sees the rental property as an income producing asset for his business
  • By virtue of being an outside agent, that agent is usually not aware of the recent leasings in the complex and what rental is now achievable in the market place