Didn't realise that, thanks Steve. That's a nice little option to have. There is that option in Vic (ie no reason), but it is 120 days.
Rents Falling!
- Thread starter JIT
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Didn't realise that, thanks Steve. That's a nice little option to have. There is that option in Vic (ie no reason), but it is 120 days.
While you are within your rights to do it, if they are good tenants then this will be seen as a tad unfair.
It may be more diplomatic to get the PM to inform them that the rent needs to increase by $60 p/w, but that you will phase it in over the next two leases.
They will be more receptive to this, and if they're not, they'll look elsewhere and you can put in a new tenant at the correct rate with their new lease.
We have just recently put a Perth rent up $50/week, from $300 to $350 - tenants didnt even blink an eye, as they know they wouldnt be able to find an equivelent house nearby for any less, and we had put it up $20/week on the previous 12mth lease...if we had strung the increases over a couple of leases we would get further and further behind the market rent...
In Cairns on the other hand, we haven't increased the rents at all at renewal, as the market has stagnated - we would rather keep the tenants than risk testing the market, and potentially waiting a few weeks to re-let...
Nadia
In Cairns on the other hand, we haven't increased the rents at all at renewal, as the market has stagnated - we would rather keep the tenants than risk testing the market, and potentially waiting a few weeks to re-let...
Nadia
When good tenants are easy to come by - and the rent doesnt begin to approximate the costs of ownership - then they can pay market. No "easing" required.
I had a residential townhouse become vacant in Cairns, normally this one rents easily as it is close to the beach and is 3 bedrooms and totally renovated, for $300, but this time I waited 11 weeks then took tenants that were a bit borderline at a reduction of $25 a week. References were good but they had 3 children. I don't mind children but this is in a complex where the Secretary of the BC appears to pick on families with kids.
They are constantly late but do actually pay, PM sends appropriate paperwork each time they are late but the tenant lost his job so is struggling to pay.
He now has another job so I am hoping he starts paying on time. He did have excellent references but circumstances change. I am working on the assumption it is better to get late rent than none at all.
Chris
They are constantly late but do actually pay, PM sends appropriate paperwork each time they are late but the tenant lost his job so is struggling to pay.
He now has another job so I am hoping he starts paying on time. He did have excellent references but circumstances change. I am working on the assumption it is better to get late rent than none at all.
Chris
That can work if the rental rate is stagnating and you're just intending to bring it back up to market. If the market rate if growing well, then the $60pw rise over 2yrs could well end up $60 below market again at the end of that 2nd year and you have the unpleasent task of telling the tenants the same thing again. Meanwhile you're stuck below market the whole time and continually trying to catch up.
Another good way to keep closer to the market rate is increasing by a small increment at the half way point of a lease (assuming your state law allows), so that some of the bite is taken off mid year leaving a smaller resultant increase with the new lease. eg. one of ours let out about 4 months ago at $200pw (market at the time), now looks to be worth about $220-230pw and who knows by the end of the lease - so at the 6 month mark we'll increase it by $10pw so instead of a $30pw kick at the end of it, will only be $20pw.
What I do on leases 12 months or greater is put a clause in the lease agreement, so that the landlord may review and increase rents inline with market conditions at 6 month intervals within the lease.
Depending upon state regulations I may also need to stipulate in the lease agreement what that 6 months increase will be monetary wise.
Depending upon state regulations I may also need to stipulate in the lease agreement what that 6 months increase will be monetary wise.
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So what about all those projections and comments about rents rising 10% per annum for the next couple of years ?
Pure crystal balling based on underlying fundamentals. Whether those predictions come to fruition or exceed it, as usual only time will tell.
How so Steve ??
As a Landlord, it is by far the most pleasant thing I do. I very much look forward to letting the Tenants know their rent is going northwards. The more the merrier, and the more frequently the merrier.
Ha true, but I'm not the most people friendly/understanding person when it comes to people whinging about prices. If I did it myself in my own personal way, they'd probably trash the place to spite me. Ah yes, good ol residential property eh Daz.
I get to deal with enough whingers in my business when prices go up every few months.
but that's where the real $$'s come in so it's worth it, not this piddly little $20pw yearly rises. Not worth my effort dealing with them, PM's are worth their weight in gold when it comes to resi prop.Ha true, but I'm not the most people friendly/understanding person when it comes to people whinging about prices. If I did it myself in my own personal way, they'd probably trash the place to spite me, eh Daz.
haha - you sound about as keen to listen to their whinging as what I am.
Amen to that.
....and sparky23 - you're spot on - nothing like a little twirl to get you fired up. What's a kaftan....and who would wear one of those ???
I have tenants vacating in IP (Northcote 2 br apartment), currently paying $320pw. Advertised at $360pw, might be a bit high. We'll see how it goes.
I've got one in Northcote too, let us know what happens.
Had a message from RE that lease on one of the properties was expiring and probably time to put up the rent. Told RE will leave it in their hands but the tenant has been good and would rather keep them than lose them over a few extra dollars. Tenant signs new lease for a year with 50/week increase. Now where are the rents dropping again?
