Great news! Possible $50 rental increase!

[geoffw]

Hi Geoff. I'm confused! Which threads were merged? I wasn't online yesterday so I'm not sure what happened.

Matto


lol I have no idea!

The initial post was posted twice, creating two threads. This can happen when the response is slow. Dazz responded to one, matto to the other.

In the ACT it's pegged to the CPI - so a spike like that would be deemed "excessive."

My reading of the ACT rules is that it doesn't prohibit price rises- it just means that the tenant can refer a price rise to the tribunal, and it must be able to be justified. If the market has gone up substantially, that can be reasonable justification.

It's sounding like you self manage? A PM should be up with rental levels. I self managed a property for a while- when I took it to a PM the rent was able to be raised substantially. What I thought I was saving by self managing was really a loss.

 

[matto_]

When you say a pm should be up with rental increases, do you mean they should have investigated comparables proactively?

W have been through numerous pm s and not one of them have done that off their own bat. In fact often I have had to do that myself.

Sounds like something to aim for.

 

[DaveM]

When you say a pm should be up with rental increases, do you mean they should have investigated comparables proactively?

W have been through numerous pm s and not one of them have done that off their own bat. In fact often I have had to do that myself.

Mine recommend rental review every 6 months and advise if the rent should remain or be increased based on market comparables.

I guess good help really is hard to come by.

 

[Alex P Keaton]

With a tight rental market, this will force renter's hands and they will buy their own property, driving up the lower end of the market.

Smart investors have been buying properties with the increasing yields due to the tight rental market and there have been indicators showing that the Perth market has now bottomed out and now on the upswing.

Housing listings also dropping which indicates the upswing has commenced.

Yep I agree!!

 

[Alex P Keaton]

Congrats Alex!

Not that long ago you were doing it very tough.

Now you have increasing rents, decreasing interest payments and the real possibility of capital growth in the near future.

Very different to the outlook 6-12 months ago.

Well done on battling through the tough times, you deserve the rewards.

thanks! Yes great news! I got through that tough 2 year period and now will be able to breathe easier. Should be able to save some more money now.

Yep this time last year I was stressed out big time with money troubles. So glad I was able to ride out the storm. Have to secure the tenant first though. Fingers crossed I'll get a nice rental increase!

The other property in the complex (the unrenovated one) that asked for $250 pw has just been leased as of today. I rang up the PM a few minutes ago to find out how much it went for and how many applicants there were. Waiting to hear back from her.

 

[Alex P Keaton]

plus one for that! Sometimes you just have to hang on by your teeth - but property can be very forgiving if you are prepared to make the tough decisions

thanks! yeah. I'm very happy and relieved right now!

I think now that the rents have increased Perth is due for some growth now. Wonder when fellow SS's will start investing in the Perth market. If you buy lower end over here its getting closer and closer to neutrally geared now. I'm actually a little tempted to buy again but I really need to build my buffer up a bit because if I have 3 properties I will have to make sure I can afford all the different kinds of expenses that crop up and that means having more of a buffer in my offsett account.

Im hoping Perth's CG doesnt start to go gang busters for another 1-2 years as in 2 years time I reckon I'll be able to afford to buy again. I just would like to have about $20 K saved first as I have little in equity to use as a buffer. Currently my LVR is about 75%. So I'll stick it out for the year living at mum and dads and then see what my next move will be according to how much I've managed to save and whether or not I need my independence again lol. Have to weigh everything up. Future is looking bright!

 

[Alex P Keaton]

The initial post was posted twice, creating two threads. This can happen when the response is slow. Dazz responded to one, matto to the other.

oh ok i see

My reading of the ACT rules is that it doesn't prohibit price rises- it just means that the tenant can refer a price rise to the tribunal, and it must be able to be justified. If the market has gone up substantially, that can be reasonable justification.

It's sounding like you self manage? A PM should be up with rental levels. I self managed a property for a while- when I took it to a PM the rent was able to be raised substantially. What I thought I was saving by self managing was really a loss.

I was reading last weeks Perth's sunday times and the journalist quoted that according to the laws tenants can take landlords to court if they believe they have been hard done buy with a large rental increase. The landlord needs to justify the rental increase. ie show proof that market rate has increased.

 

[Alex P Keaton]

Mine recommend rental review every 6 months

Wish I had put a 6 monthly rental review into my highgate clause! I'll learn from this!

 

[geoffw]

Wish I had put a 6 monthly rental review into my highgate clause! I'll learn from this!

Go to your rental laws. In the ACT you are only allowed to increase once every twelve months.

You need to find the WA laws- they should be easy to find in a summarised form- and get to know them well. Especially with recent changes in WA (still pending?). It can make a big difference.

 

[santaslayer]

Wouldn't your PM be well versed in things like this? I'm not expecting them to be legal eagles but they should be able to advise on matters like this.

 

[Alex P Keaton]

yep i'll do it soon. When it gets closer to the time!

 

[Alex P Keaton]

Here is the Sunday times article

 

[INVSTOR]

Here is the Sunday times article

You've got to love the comments section...Greedy landlords!!

 

[redwing]

Go to your rental laws. In the ACT you are only allowed to increase once every twelve months.

You need to find the WA laws- they should be easy to find in a summarised form- and get to know them well. Especially with recent changes in WA (still pending?). It can make a big difference.

With WA we've had six month leases and reviewed/increased it at the six month period for the next six months. We've also had twelve month leases with built in increases at six months

 

[INVSTOR]

Lease ends in July & tenant told PM she might move out.

http://www.commerce.wa.gov.au/consumerprotection/PDF/Forms/Schedule2InfoForTenants.pdf

 

[Alex P Keaton]

thanks for the link


hahaha

check out this comment

i have lived in a 4x2 in beford for 7 years and still only paying $320 a week !... lucky for me the owners live in usa and dont know they could be making a killing off of me lol ... and to the people who say *just buy* its not that easy to get a bank loan when young or working retail, not to mention getting a deposit and stamp duty to pay :/ ...

 

[Alex P Keaton]

from the comments section of the article.

This is crazy. I got a letter last week from the property manager saying weekly rent is going from $425 per week to $550 per week. If we dont accept this increase we have 60 days to vacate. Problem is there is not much in this area to rent. This is getting really scary. We might end up just staying and paying the extra rent but that was money going towards our deposit to buy. Looks like I will be stuck in this rental trap a few years longer till rents come down and I can save more again.

hmmm maybe this is the sort of letter that can be drafted by my PM.

I just got in contact with my PM via email. Waiting to hear her reply.

 

[Alex P Keaton]

My PM's reply

The current agreement ends on 06/07/12.
I do believe that this increase would see that Brenda was to vacate the property as last time we increased the rent to $230.00 per week she was hesitant. However she may not be able to find anywhere cheaper than $280.00 per week which may in turn result in her staying.

If she is to leave we will have to re advertise the property and hold home opens etc. if I were to advertise the property I would probably say that $280.00 is a little bit high. We had over 90 people enquire and come through unit 12. We only received 1 application out of all of those people. If we could not find the right person for the property it is possible that the unit would sit vacant for a while and you would then be loosing out on rent.

Please have a look on www.realestate.com.au at comparable properties.
There are many units available on terrace road in the city and they are all under $300 per week. These are located within the CBD almost and are basically on the river.
There are a couple available in Inglewood.
4/157 ninth avenue, Inglewood which is $240.00 per week
11/57 tenth avenue, Inglewood which is $270.00 per week
There is a unit not too far away in Yokine. 20/379 hector street, yokine. This is a 2 bedroom unit for $300 per week
There is also a brand new unit in Nollamara for $272 which is also a 2 bedroom place. 2/88 Harrison street, Nollamara.

I am happy to proceed with what ever instruction you wish. Please let me know.

 

[Alex P Keaton]

I haven't got time to respond to this on here as Im at work and have a deadline to meet. I'll come back online tonight

 

[sanj]

i would double check all of her comparables.

on the face of it it looks like a reasoned response but the nollamara property is a) 1 bed+study and not a 2 bed
b) an NRAS property so not eligible for everyone

she is right thought that if you overcook it you can shoot yourself in the foot