Hi Jamie: yes, my property got snapped up immediately. And yes you're right: it will change again.
Canberra rental market sooo bad?
- Thread starter Aulyna
- Start date
Hi Jamie: yes, my property got snapped up immediately. And yes you're right: it will change again.
Hi Jamie.
Thanks. I advertised on gumtree, the uni forums, and stuck up a few flyers on message boards around UC. Had probably 20 people through, 15 of who were interested.
3 out of the 5 tenants are students. Others just work nearby. Everyone is a 20 something and they all seem to be getting along ok (for the time being!)
Hey,
thanks to you too. No property manager here. I have 2 places in Canberra and they are both managed by me in the same way (except I live in the master bedroom in one).
Group house? I guess you could say that. All tenants there are on individual leases between myself and them, for their room only. They did not know the other tenants before they moved in. The plus side of doing it that way is that you obviously make more by selling pieces of the pie rather than the whole pie. On the other hand, its more admin and more work managing the place.
As you were getting at in your post, theres no advantage at all in renting to a group if they're on a standard lease paying the market rent. Your 6 bedroom place would probably be awesome to rent out to students individually or whatever though, if you wanted to take a hands on approach to it. What suburb is it? Is that the property that you took a $350 drop on?
Hi Rohan22no, I think if you're young and energetic, yours is the way to go. Good on you. I don't want to be so hands on, as I don't like dealing with tenants if things go awry. My place is in the Inner South, where I know properties have had to drop their rentals by hundreds. I'm philosophical about it and know that it's swings and roundabouts. I have always been reluctant to rent to groups, especially students. I don't know what other groups are like though.
Good result.
That's where you've done well - you've been proactive and thought outside the square as opposed to just popping an advert on allhomes and/or gumtree.
I've inadvertently rented to a group before (it was supposed to be one couple - and after a month it turned into three without our consent!). It didn't end well :-(
Cheers
Jamie
Hey again,
Yeah - If I was renting out in a traditional sense, I'd definitely avoid groups. Need to be compensated for the extra mucking around. Re: Young and energetic, well, I'm 28 - is that young? And Energetic...not sure there either, I guess having repayments on a 7 figure debt will do that to you
Your rental prices are sooo high .... Is the whole house furnished?
How do you deal with the bills? Do you sign a long or short term agreement with each tenant?
Thanks for sharing
I'm 28 - is that young? And Energetic...not sure there either, I guess having repayments on a 7 figure debt will do that to you
Yes, you are young (I am 53). You have your whole working life ahead of you. Now is the time to have the debt. A 7-figure debt? That's a lot!
There's a huge market for this in Canberra - in/out city creates demand for this type of rental dwelling. Well done Rohan, those yields are great.
A large proportion of my mates are sharing in Canberra. The rents dont fall so much when your sharing...as a tenant, i dont think they care as much given theyre proportionately only likely to save $10/$20 individually.
Of course, it creates management headaches and involves more work. Could also mean shorter tenancies too - its harder to share house for years on end.
Out of interest, i recently saw a property purpose built for what your doing rohan.
The place had 4 bedrooms, each with their own ensuite - a common living/laundry/kitchen.
The beauty was - each bedroom had its own NRAS grant. Thats $8000 per year RTO, for each bedroom.
Absolutely amazing - not sure how DSS approved it, but great numbers. The owner would be pocketing $30k a year in cash flow gains.
The place had 4 bedrooms, each with their own ensuite - a common living/laundry/kitchen.
The beauty was - each bedroom had its own NRAS grant. Thats $8000 per year RTO, for each bedroom.
Absolutely amazing - not sure how DSS approved it, but great numbers. The owner would be pocketing $30k a year in cash flow gains.
Your rental prices are sooo high .... Is the whole house furnished?
How do you deal with the bills? Do you sign a long or short term agreement with each tenant?
Thanks for sharing
Hey Aulyna,
yes, I furnished the common areas of the house. Cost about $2000 all up. Re: bills - I pay for everything except electricity, which will be paid by the tenants equally.
Varying leases with each tenant, generally 3-6 months.
Wow...amazing...wish I had thought of that!!
Hi all, the market in Canberra is excellent for tenants, not so good for landlords. I have had quite a few friends finishing leases recently and one was offered a $30 deduction to stay on and one managed to negotiate $45 a week off. When we rented our place less than 12 months ago we offered $80 a week less than the asking price and it was accepted. If we weren't moving out of Canberra we would be able to negotiate a further reduction I think. Our real estate agency have already been in touch to see if we are staying on and have said the market is dead.
I have been here since 2006 and have never seen this. You used to have to fight it out with 20 other people, especially posting season.
Cheers.
I have been here since 2006 and have never seen this. You used to have to fight it out with 20 other people, especially posting season.
Cheers.
Yep - experienced this 3 years or so ago.
I think Canberra home owners are more likely to have buffers in place than some other cities - so hopefully most people can absorb rental falls quite easily.
Still wondering how you can rent the master room for $240/w
it's very highDo you rent it to a couple?
My place is in the inner north, a 3bd place in a nice quiet street. I only moved out early this year, and didn't really have any problems renting it. I suspect it was location, a big backyard, and being pet friendly. There is an oversupply (IMO) of apartments, so it's a good time to buy if you're happy to live in it until the market picks up.
I was intending to stay in mine, but got sent up to Newcastle. I wouldn't buy at the Kingston foreshore, I'd rather be on the north side of the lake personally, or in the apartments more inland. My friend bought a beautiful large ex-Quest (?) apartment in Kingston for a very good price, I'd happily live in it if I didn't have a dog.
I was intending to stay in mine, but got sent up to Newcastle. I wouldn't buy at the Kingston foreshore, I'd rather be on the north side of the lake personally, or in the apartments more inland. My friend bought a beautiful large ex-Quest (?) apartment in Kingston for a very good price, I'd happily live in it if I didn't have a dog.
Inner North is where it's at
My PPOR is in Downer - office is in Dickson. Oldest kid goes to school in Watson. I love this area - and it's gentrifying. A good mix of old timers who have been around from the start and young families.
Cheers
Jamie
Still wondering how you can rent the master room for $240/w
Do you rent it to a couple?
Previously rented for $280 by old owners. And everyone says "that seems high"...and then I show them it and they go "yeah...ok". Take my word for it - Its a hell of a Master bedroom
Its rented to a single person.As others said, inner North definitely where its at, always people lining up to rent there. Good areas of Belconnen are always a winner too. Stand alone houses are where its at, I think you'd be crazy to buy an apartment as an investment here. Massive oversupply combined with ridiculous body corporates. No thanks.
Market is very flat at the moment, but meh, its not terrible. Sure, tenants are negotiating lower rents etc, but they're still there. Its only 3 short years ago there was the rental crisis. Now its gone the other way, but only a matter of time before it swings back again. I've dropped most of my rents significantly and am still relatively easy achieving a 10% yield on purchase price on both my properties here.
My crystal ball is saying the rental market will be struggling (like it is now, but by no means terrible) for the next 6 months or so, be neutral and or good in a year, and stay like that/get better for the next several years. Great news for me personally. I know that I'll be a net buyer in Canberra over the next 3 years, thats for sure. Planning to buy another 3 houses and do the group-house thing again...hopefully all within the next 24 months or so.
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Without sounding like a downer (and I'm not saying it isn't possible) but it can become tricky getting lenders to take into account rent from single rooms for servicing. If servicing still works on market rent you should be ok - but if your borrowing capacity becomes reliant on share house income it can make it tough.
Cheers
Jamie
