What would you do.

[zimby]

Howdy

Here's the situation.
Purchased a property last year with bad tenants, knowing they were bad tenants and with a plan to move them on.
Property settles and first inspection is done, early Jan with their lease to run out in March.
Previous property manager was terrible, even increasing the rent without any documentation.
So new property manager thinks that the tenants just need a firm hand, wanting to believe the new manager and them having only a few months left on the lease I relented.
Tenant then inquires about a a 1 month extension, Property manager has since further inspected and the place is bordering on acceptable.
I agree to the extension only if the tenant pays for professional cleaning when they exit.
So 1 week before the tenant exists our new property manager advises that they aren't extending their lease and that we should probably advertise for new tenants.
So now we have to chop and edit old sale photo's just to have pictures.
Saturday Open rolls around ( tenant due to leave on Sunday) and the manager turns up to find what is in essential a giant rubbish bin.
Looks like the tenant had left for oversea's mid week and left all the stuff he couldn't sell behind.
To top that off the new manager hadn't gotten the alarm from the old manager so this was going off, needless to say we didn't sign any tenants.
Cleaning - 700 Inc carpets.
Handyman- 1700 Inc painting fixing door's etc
Garden - 200 fixed this myself
Blinds - 1000 ( I know this is expensive, but got a good warranty)
Bond has been requested and there is a fairly good chance we will get this back, Insurance claim has also been made.
Also found paperwork from previous Issues with the Tenant and RTA, how did these guys ever rent this place....
First week $5 ontop of current rent, only old photo's and renovations done, 1 couple interested, but no application.
Second Week new photo's, 2 groups, too expensive.
Third Week Price drop by $25pw only 1 group show.

The property isn't overpriced for the area, given its fairly close to a train line.
Property is located in North Brisbane, Manager advises that the peak rental period has ended.
The amount of development in these area's is a bit of a worry, good for long term growth but hell for cashflow.

I'll be further dropping the rent this coming week.

Do I drop to a silly amount just to get us to the next peak period, then move the current tenant on or increase rent fairly heavily.
Is this common for northside, I'm used to targeting student area's where rental demand is quite strong.
Should we count this as a mistake,cut our possible losses and move on.

Cheers

 

[Tim86]

I wouldn't use an agent. Agents don't care about getting a tenant as much as you. If someone rings up too late or too early or on the agents day off and asks for an immediate inspection there is no way the agent will be putting in the extra effort to get that tenant. Also agents don't answer every call like you would enquiring about the property. When it's hard to find a tenant you need to put in that extra effort that an agent won't. I would advertise on Gumtree and repost the ad every day so it stays at the top. I would find out the rent of other equivalent properties in the area and advertise your rent as $5-$10 less per week. I would also look at the possibility of share accommodation to see if there is more tenant demand for that. Anyway that's what I would do.

 

[willair]

Howdy

Here's the situation.
Purchased a property last year with bad tenants, knowing they were bad tenants and with a plan to move them on.
Property settles and first inspection is done, early Jan with their lease to run out in March.
Previous property manager was terrible, even increasing the rent without any documentation.
So new property manager thinks that the tenants just need a firm hand, wanting to believe the new manager and them having only a few months left on the lease I relented.
Tenant then inquires about a a 1 month extension, Property manager has since further inspected and the place is bordering on acceptable.
I agree to the extension only if the tenant pays for professional cleaning when they exit.
So 1 week before the tenant exists our new property manager advises that they aren't extending their lease and that we should probably advertise for new tenants.
So now we have to chop and edit old sale photo's just to have pictures.
Saturday Open rolls around ( tenant due to leave on Sunday) and the manager turns up to find what is in essential a giant rubbish bin.
Looks like the tenant had left for oversea's mid week and left all the stuff he couldn't sell behind.
To top that off the new manager hadn't gotten the alarm from the old manager so this was going off, needless to say we didn't sign any tenants.
Cleaning - 700 Inc carpets.
Handyman- 1700 Inc painting fixing door's etc
Garden - 200 fixed this myself
Blinds - 1000 ( I know this is expensive, but got a good warranty)
Bond has been requested and there is a fairly good chance we will get this back, Insurance claim has also been made.
Also found paperwork from previous Issues with the Tenant and RTA, how did these guys ever rent this place....
First week $5 ontop of current rent, only old photo's and renovations done, 1 couple interested, but no application.
Second Week new photo's, 2 groups, too expensive.
Third Week Price drop by $25pw only 1 group show.

The property isn't overpriced for the area, given its fairly close to a train line.
Property is located in North Brisbane, Manager advises that the peak rental period has ended.
The amount of development in these area's is a bit of a worry, good for long term growth but hell for cashflow.

I'll be further dropping the rent this coming week.

Do I drop to a silly amount just to get us to the next peak period, then move the current tenant on or increase rent fairly heavily.
Is this common for northside, I'm used to targeting student area's where rental demand is quite strong.
Should we count this as a mistake,cut our possible losses and move on.

Cheers

From the small pool of property investors that ,I know a few are in the same boat as you,i would just as you say put in down to experience and move on ,,but as I see you live in Brisbane why don't you just self manage that way you cut out the effect of reputation of someone else looking after picking up the rent..imho..

 

[BMan]

i wouldnt drop your rent too far down it then takes too long to get it back up
offer 1 free weeks rent or something similar
dropping it $10/week is $520 a yr
2 weeks free rent at $250 is $500 a yr and a small rental increase when you can, brings it back up to a decent rent without the tenant feeling shafted.