Property Managers Distorting True Market Rent

i’m in a crappy position at the moment in that I need a short term rental….
but problem is short term to most realtors is 6mths+ and not the 2.5-3 mths I need for my new place to be built..

Also, i’ve never rented. period.So can’t wait for the applications I hand in, funny thing is i’m on $100k + but know that i will still find it hard to rent a place.

I feel for the people who can’t rent as low income / single income etc, but to the OP – mate, I hope I never ever have to rent from you.. you sound like a dream lessor…. yeah a nightmare.

Property Manager said :

My my my, what a storm in a teacup.

2AK is such a penny pincher that they’re proud of saving 8% in agent fees, AND charging tenants $30pw over market rent. Hallelujah though, 2AK will accept any tenant – particularly those struggling to rent in a competitive market. In fact, 2AK prefers them… probably because when they have no other options they’re willing to pay the premium price being asked for that shitbox unit in Cotter Court.

That’s the kind of landlord I would want to rent from!!!

Champion, all you’ve proven is that, while property managers are imperfect, there are many of us who are stuck representing greedy schmucks who have all the compassion and humanity of an electric eel. As agents we represent a range of personalities that reflects the different people within our society in general. As with any group representative of the population, there are some genuinely wonderful people we represent; but there’s also people like 2AK.

The market has ‘softened’ considerably over the last two years, and an oversupply of apartment stock has seen prices come back from the lofty highs owners enjoyed in 2010. As pointed out by some of the smarter contributors here, if an owner sets the price low to attract the greatest possible market interest in their property, they will have the best chance of securing the best possible tenant, at the best possible price. That ain’t rocket science.

For those struggling to secure a rental property, I genuinely feel for you. It is a horrid position to be put it – you have no history, so no one is willing to take a chance on you, so you can’t get a history – rinse and repeat.

I offered some general tips for securing a rental some time ago at http://the-riotact.com/tips-for-getting-into-a-rental-property-in-canberra/37570

Beyond that, the advice to have a parent or someone co-apply with you is a great idea*. It provides the property owner with greater security, while allowing you to build your own rental history. Just don’t screw it up or you’ll have a negative rental history and will quickly run out of people willing to co-apply with you.

Hopefully the slowing of the rental market, particularly in the apartment/unit sector will see previously greedy lessors left with no option but to take a punt on respectable, mature and friendly people without a rental history.

*I know its not fair that you should have to co-apply with a parent. It’s not fair that the owner can’t just take you at your word and disregard the applications from tenants with good rental histories just to give you a go. It’s also not fair that you can’t see a doctor without a 4 hour wait and an eventual misdiagnosis. It’s not fair that many mothers have to spend more on daycare than they can make at work. It’s not fair that One Direction is… alive 😉 Unfortunately though we can’t control the things that we might think are unfair, all we can control is ourselves within the circumstances inflicted upon us.

My my my, what a storm in a teacup.

2AK is such a penny pincher that they’re proud of saving 8% in agent fees, AND charging tenants $30pw over market rent. Hallelujah though, 2AK will accept any tenant – particularly those struggling to rent in a competitive market. In fact, 2AK prefers them… probably because when they have no other options they’re willing to pay the premium price being asked for that shitbox unit in Cotter Court.

That’s the kind of landlord I would want to rent from!!!

Champion, all you’ve proven is that, while property managers are imperfect, there are many of us who are stuck representing greedy schmucks who have all the compassion and humanity of an electric eel. As agents we represent a range of personalities that reflects the different people within our society in general. As with any group representative of the population, there are some genuinely wonderful people we represent; but there’s also people like 2AK.

The market has ‘softened’ considerably over the last two years, and an oversupply of apartment stock has seen prices come back from the lofty highs owners enjoyed in 2010. As pointed out by some of the smarter contributors here, if an owner sets the price low to attract the greatest possible market interest in their property, they will have the best chance of securing the best possible tenant, at the best possible price. That ain’t rocket science.

For those struggling to secure a rental property, I genuinely feel for you. It is a horrid position to be put it – you have no history, so no one is willing to take a chance on you, so you can’t get a history – rinse and repeat.

I offered some general tips for securing a rental some time ago at http://the-riotact.com/tips-for-getting-into-a-rental-property-in-canberra/37570

Beyond that, the advice to have a parent or someone co-apply with you is a great idea*. It provides the property owner with greater security, while allowing you to build your own rental history. Just don’t screw it up or you’ll have a negative rental history and will quickly run out of people willing to co-apply with you.

Hopefully the slowing of the rental market, particularly in the apartment/unit sector will see previously greedy lessors left with no option but to take a punt on respectable, mature and friendly people without a rental history.

*I know its not fair that you should have to co-apply with a parent. It’s not fair that the owner can’t just take you at your word and disregard the applications from tenants with good rental histories just to give you a go. It’s also not fair that you can’t see a doctor without a 4 hour wait and an eventual misdiagnosis. It’s not fair that many mothers have to spend more on daycare than they can make at work. It’s not fair that One Direction is… alive 😉 Unfortunately though we can’t control the things that we might think are unfair, all we can control is ourselves within the circumstances inflicted upon us.

Dork said :

I agree with selective choice in tenants. Me and my partner applied for over 30 rentals places a little over a year ago. We looked at over 40. Each application we were told that we were too young and had no referances. I think this is crap, how is a 19 year old that can’t live at home anymore supposed to get a rental? Also, it’s not like we were unemployed, I’m a public servant and my partner works for a private company. We eventually got one out of town and then a year later they put it up $20 a week even though the place was in worse condition (general wear of carpet etc) than when we got it. They just do whatever the hell they like. Rentals are crap.

Just get a well off relation or friend to make the application for the rental place then take the rental property sub-leased: no law stopping this! The owners hate this, though, as sometimes they get the worst kind of tenants who also know how to assert heir rights.

steveu said :

With all the multi-dwelling units that have gone up in the last 10 years its amazing that rents haven’t dropped since supply has gone up? I didn’t think that many extra jobs (creating demand on accommodation) had been created in canberra over that period. Apologies for my ignorance here. Just seems we have a heck of a lot more apartments here than we used to, majority of which I would think would be owned by investors.

One possibility is that a lot of new unit stock is vacant.

Just anecdotally, the unit next to mine has been vacant since it was built about 9 months ago. Places like it wouldn’t show up on rental vacancy statistics because they’ve never been advertised for rent.

I met the owner once, who said she hadn’t rented it because she was a first home buyer. I’ve no idea how you make the numbers work in your favour on that one, but it goes to show that people deliberately leave properties vacant nevertheless. I know of 2 other units in the complex that I’m pretty sure have been vacant since they were built, and I suspect there are others.

Wouldn’t a RE agent be better off putting a high rental price on the property which would theoretically attract wealthier and better tenants and also cut down on the number of applicants so less work for RE agent to do (not that a lot of them seem to do much work anyway…)?

Maybe they put a low rent on it just to get a tenant quickly and like someone mentioned the extra $10-420 per week they might get is worth SFA to the RE agent.

With all the multi-dwelling units that have gone up in the last 10 years its amazing that rents haven’t dropped since supply has gone up? I didn’t think that many extra jobs (creating demand on accommodation) had been created in canberra over that period. Apologies for my ignorance here. Just seems we have a heck of a lot more apartments here than we used to, majority of which I would think would be owned by investors.

The book Freakonomics has a good write up with real world data on real estate agents. Simply a small increase in rent or sale price isn’t worth their time simply because they are only making a sub 8% return.

So for the owner getting an extra $10 per week in rent or 10k on a sale is great, for the agent it’s really pennies and not worth the extra time they have to devote to finding someone who’ll pay more.

If anyone doubts this the US data is there for anyone to go though. Not hard to do the figures for here.

2AK, you are tilting at windmills. You are doing a lot of supposing and presuming and assuming.

Your story is confusing, too. You rented your place two years ago, but then you mention five weeks, but the other place is still not rented … what is going on here?

Also, your statistics are meaningless: regardless of how many or few turn up to view a property, there can be only one tenant. It’s not a statistical measure, it is an absolute. To have 90% of applicants rejected means you had 10 applicants, and you accepted one.

As for people who are students, single, or otherwise don’t fit the DINKY mould, just make sure you get in early to be at the top of the list. The property manger isn’t looking for perfect tenants, they just want the first decent tenant they can get a signature from quickly.

But 2AK really needs to get that story straight before we can start handing out cookies for being canny enough to rip someone off to the tune of $20/week.

2AK said :

The reason I believe the property at Lyneham is still not rented is the agent is looking for 5 star model tenants and not your average Joe. In the mean while owners have lost $1650 in lost rent for the 5 weeks that’s vacant. They don’t care how long a property is vacant, it’s not their money all they care about is getting the best tenants this will lead to less work. My concern here is the absence of middle ground.

You may be right on that, although I wouldn’t have thought that’d be a particularly successful strategy. High income senior professionals probably aren’t looking to rent 50 year old un-renovated flats, and if it stays on the market for too long, surely the owner will ditch them for another agency.

I do agree that rental prices have soften, but in saying that I rented my Lyneham property
two years ago at $360 while other RE were advertising theirs for $330 while the rental market
was hot.
The reason I believe the property at Lyneham is still not rented is the agent is looking for 5 star model tenants and not your average Joe. In the mean while owners have lost $1650 in lost rent for the 5 weeks that’s vacant. They don’t care how long a property is vacant, it’s not their money all they care about is getting the best tenants this will lead to less work. My concern here is the absence of middle ground.