Am I doing something wrong?

[Trogdor]

Hi guys,

On some of these threads you all seem to mention rental increases every year, some of which match or exceed CPI, etc..

Now leaving CPI aside, I bought a place in Fitzroy Nth in August 2002. Initial rent was 335 per week.

The second tenant came in at 340 per week.

The third, and current tenant, came in (April 2005) at 350 per week.

So in three and a half years, rent has only increased by $15, or 4.4%.

And its not my property only. I rented a place where I lived for about 4 years (2000 - 2004), in carlton (awesome location - 100 metres from Melb uni, big historic type apartment) for the same rent for the entire stay. This is the sort of place I would have bought it it came up for sale. Not a single increase in 4 years!

Now in Southbank renting (I know, a crap place for the owner!), got $60 pw OFF the asking rent, and after my fixed term lease expired the owner was happy to let it revert to periodic with no increase.

So - is this just a inner melbourne theme??

Thanks!

 

[Jacque]

Hi Trog
Not familiar with Melb but isn't there an oversupply of inner city units (Docklands etc)? This may help explain why you got such a good deal.
As for the lack of exciting increases over the last 4 yrs, I think that you'd find that pretty standard in Sydney too, over the same time period.
There have been numerous examples of stagnant rents because of the increasing supply since 2001/02 of rentals and naturally decreased demand tends to push prices down. Consider yourself fortunate to have got any rises
My Sydney unit started off at $275 four yrs ago and I can only get $260 now. For 12 mths there, it was only $250
Times are achanging, albeit slowly, but changing all the same.

 

[Trogdor]

Gee Jacque, thats frustrating! Where in Sydney is it?

You would think that in the next few years we should hopefully see some bigger increases???? Or am I just thinking wishfully

 

[Marina]

HI
I actually have the same problem and wondering when rents will increase.
East Doncaster rental at 250pw in September 2000- purchase price 185000K
Would you believe the rent now in February 2006 is still 250pw.
The valuation however is $280000K

Maribyrnong- rental in September 2000 was 250 pw- purchase price 188000k
rental February 2006 $240pw
Valuation is $280000k

What is happening? I have no idea.
Both these are professionally managed by different agents.

Tis how the market is I suppose.

Kind regards
Marina

 

[grubar30]

HI
I actually have the same problem and wondering when rents will increase.

When you want them to and if the tenant is willing to stay at the new price.

But you have to put a possible rent rise into context of what the market demands.

If your rent is below average for that type of property in the area, then raise it at the end of the next lease...if it's the same as the avg., then maybe try your luck and raise it a little.....and if it's above the avg., well count yourself fortunate.

George