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Author: REIWA President Hayden Groves via reiwa.com.au

Although rent prices across the state have been on a downward trajectory for the last couple of years, the rate of decline has slowed with the median rent price holding steady at $350 per week since April last year.

The number of rental properties on the market has also improved, declining to approximately 8,500 listings metro wide, well down from the peak of 11,300 in 2016.

While Perth landlords don’t enjoy the dominance they experienced a few years ago, property investment is still a smart decision. And thankfully, interest rates on borrowings continue to sit at historically low levels, mitigating some of the short term financial discomfort resulting from lower rent prices.

Get your asking price right from the start

When pricing your property and preparing it for lease, it’s crucial you heed the advice of your REIWA property manager. Tenants are out there in good numbers, in fact, leasing activity reached an all-time high last year and remains at above-average levels in 2018.

Provided your rental property is marketed competitively, you have a very good chance of securing a tenant. However, if you choose to price your property higher than your agent’s recommendations, tenants are very likely to bypass your listing.

The first two weeks of listing your property for rent are the most crucial. Get your initial asking price wrong and you can end up chasing down the market, destined to end up with a weekly rent price below market value, plus you’ll bear the rent cost you missed out on when your property was vacant.

Forecast looks positive for landlords

Pleasingly for landlords, the Perth rental market has improved over the last six months and we are slowly seeing it transition into a more balanced market.

The Perth vacancy rate declined to 5.3 per cent in January – the lowest level since July 2015 and down from a peak of 7.2 per cent in June 2017. This sharp decline indicates that normalcy is returning and market parity, in terms of supply and demand, is not far away.

Despite these obvious improvements, REIWA’s forecast for 2018 cautions against expectations of rapid growth in rent prices over the coming year. Property owners are still advised to meet the market – you are better off with less rent per week than having a long vacancy period with no rental income at all.

It is also advisable to be flexible with the conditions you put on your rental. For example, not allowing tenants who own a pet to rent your property can deter people who would otherwise be interested. It’s in your best interest to consider tenants with pets on a case-by-case basis, secure in the knowledge the bond, pet bond and landlord insurance will be there to cover any pet-related damage.

For obligation free landlord assistance Sarah Morgan 9475 9622

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Rachel Preston-Bidwell via reiwa.com.au

Do you currently own an investment property in Perth or are looking to purchase one? We have four tips for how to be a good landlord, from understanding your rights and responsibilities and those of your tenant, to finding the right assistance to help you safeguard your investment.

1. Understand the law

Renting in WA is governed by the Residential Tenancies Act 1987 and the Residential Tenancies Regulations 1989. As a landlord, it’s good to have a basic knowledge of these laws and regulations as there are specific provisions covering issues, including but not limited to:

• Security bonds
• Rates and taxes
• Damages and repairs
• Notice periods

More information about the relevant laws and regulations can be found on the Department of Mines, Industry Regulation and Safety website.

Brush up on your rights and responsibilities and if you have any queries, speak to one of our friendly officers in the REIWA Information Service.

2. Take note of your safety responsibilities

Ensuring your investment property is in working order prior to renting it out is a must to keep your tenants, property manager and yourself safe.

As the landlord, you have a responsibility to ensure your property meets certain safety standards and if issues arise during the tenancy, you must address them in due course.

Three main safety issues to be aware of include:

• Blinds and curtains
• Pool and spa fences
• RCDs and smoke alarms

Read our article about your safety responsibilities as a landlord for more information.

3. Know the costs involved

An investment property is just that, an investment. Landlords should expect to invest some money in their property in order to reap the rewards later in life, whether it be for a retirement fund or to purchase another property.

Be sure to consider the costs involved in renting out your property, including:

• Insurance
• Property taxes
• Strata fees and/or rates
• Maintenance and repair costs

Some costs are tax deductible, so speak to your property manager or accountant for more advice on making a claim come tax time.

4. Engage with a property manager

Not only will a property manager act as a liaison between you and your tenant, they can assist you with the following:

• Evaluate the market – a property manager can conduct an evaluation of your property in comparison to other rentals on the market. This can help you determine a competitive rent price and marketing campaign to secure a tenant.
• Help with tricky questions – property managers undertake extensive and continual learning to stay up-to-date on rental laws and regulations. They can help you to understand both yours and your tenants’ rights, and further assist you with tricky situations such as break leases.
• Find your perfect tenant – your property manager will hold home opens and assess applications to help you find a tenant. Further, REIWA agents have access to a National Tenancy Database, which allows them to review a tenant’s rental history.
• Maintain your investment – through regular property inspections, a property manager can ensure your investment remains in tip top condition. Further, they can assist by organising repairs and maintenance calls.

If you have any questions about renting out your property in Perth, speak to Ron Padua on 0404 428 843 or email bdm@pmmetro.com.au