Why is there a Perth rental shortage and what can be done?

The question everyone is talking about: Where did all the rental properties go?  At the start of the year, the Perth rental market started to pick up – and then COVID hit.

Legislation that was introduced restricting property managers from evicting tenants in breach of their lease lead to investors losing confidence in the market. Potential new managements were quickly swallowed back up and things went quiet.

Fast forward to now and suddenly we see the market booming. Vacant properties now have tenants and the market is looking up. Applications are flooding in and its not uncommon to see lines of potential tenants out the door of properties they are eager to inspect.

So how did we get here?

Perth is currently experiencing its lowest vacancy rate since 2008, sitting at 0.9%, well under the standard 3%.  Being on the ground and talking to people, we have discovered some compelling factors attributing to strong demand for rental properties:

1. Perth residents are returning home from being overseas
2. FIFO workers who are generally based in the Eastern States are being incentivized to stay within WA
3. Tenants that are currently in a property are staying put, as they are protected from rents rising.
4. Landlords, particularly those who purchased in the boom and have not enjoyed particularly generous returns to date are selling their investment properties, to seize the opportunity a buoyant market presents.
5. The lack of properties coming onto the market suggesting lack of investor confidence as a direct result pf the extended legislation.

Where to now?

The sales market is seeing an upward trend as evidenced in the current REIWA statistics.

           

2020 is proving to be a tough year for tenants as the total listings as compared to the previous 4 years are showing a dramatic drop in new properties becoming available on the market. Core Logic has crunched the numbers and we see this in the following table:

The top performing suburbs in Perth and rental stats.

 

 

 

 

 

 

 

 

 

 

 

The key take-away is that there has not been a better opportunity to invest in property. The sales numbers are low, with a high rental yield. This is complemented by historically low interest rates. Blackburne Mortgage Broking’s, Brian Willis confirms that “currently, interest rates for both owner occupiers and investors alike are sitting in the low 2%’s across several lenders.”

If you are interested in knowing what apartments Blackburne currently have available that would be great for investment, limited stock is still available of the stunning

Marina East development

https://www.blackburne.com.au/developments/marina-east-ascot-waters/

For information on Blackburne’s current projects you can secure off-the plan enquire on the links below for further information.

The Grove Residences

https://www.blackburne.com.au/developments/the-grove/

One Subiaco

https://www.blackburne.com.au/developments/the-grove/

East Village Karrinyup

https://www.blackburne.com.au/developments/east-village-karrinyup/

Why choose Blackburne:

• We have a very low vacancy rate sitting less than 0.5%!
• Specialized property management team
• Apart of the community
• Your one-stop agency
• We know Perth!

Want to further talk options or you are after a FREE appraisal? We would LOVE to hear from you!

• Contact Paige Garvey
• Number: 0497 977 738
• Email: garvey@blackburne.com.au

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A day in the life of a Property Manager – with Bianca Gregson

There is never really a typical day for a Property Manager, every day looks different and the skill set we hold ranges from Lawyer to Psychologist with Handyman, Marketing Manager, and Financial Advisor in between.

I like to get into the office early and work through my checklist that I made from the day before.  Its best to get the hard jobs or phone calls done first.

The minute it hits 9 am the phones are ringing; the emails are flowing and there are places to be.  From owners, tenants, contractors, and colleagues there is always someone that wants to speak with you.

There is never a “finish line” with Property Management.  It is a constant cycle of inspections (every 3 months), lease renewals (every 6 to 12 months) and management renewals (every 24 months). These tasks are completed alongside the regular following up and management of difficult tenants that do not pay their rent, as well as marketing properties to be leased and finalising bonds.

Organization is important, as you must stay on top of all these tasks.  It can spiral out of control if something is missed, that is why following checklists are the Property Management bible. It may sound silly, but each job has so many components to it that it’s impossible to remember each step to ensure the correct outcome.

My number one focus is ensuring my clients are happy.  I aim to ensure my response times are quick and that there is always a fair and reasonable outcome for all parties involved.

Working at Blackburne with an integrated team makes this easy.  Our Leasing team focuses purely on Leasing properties carrying out home opens 7 days a week.

Our inspections team focus on arranging the routine inspections, being out of the office most of the day, thoroughly checking for maintenance and cleanliness of our tenanted properties.

With both these “out of office” tasks taken care of; I can laser vision in on customer service.  Always readily available to answer the phone or your email.

In summary, our job is a busy and fast paced environment with constant interaction with the public and I love it!

 

#BetterwithBlackburne

#Dayinthelife

#PropertyManagementforlyf

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Life after COVID: What learnings can we take from the last 90 days?

Blackburne Property Management’s Business Development Manager Adrijana Servel,  gives a debrief of how the team has come out the other side of COVID-19.

Perth’s rental market had started to show real signs of recovery in 2020, with rents beginning to increase and the continuance of a low vacancy rate, showing signs of growth for the months to come. The one thing I have said to my clients on countless occasions is even if I had a magic crystal ball to see into the future, I would not have seen nor predicted COVID, it was a pandemic that shook not only the world but the overall economy.

It would be selfish to say that COVID only taught us one thing, because in fact it taught us many. Learning to be grateful and appreciating the little things and teaching ourselves to quickly adapt to an extraordinary situation we have not encountered in over 100 years. We are fortunate enough to be in an evolved world where technology has aided us, the media has updated us and people have supported us, working together to eradicate a pandemic, and teaching us to have respect for

“Coming together as a team to get the job done – albeit remotely”

For our clients, our team has worked exceptionally hard both from home and in the office. We had to quickly adapt to the social distancing requirements, cut back from open homes to one on one private appointments, seeing the overall economy shift and our level of activity soften on the leasing prospect.

The Property Managers have worked hard to be across the new COVID legislation adjoining the RTA (Residential Tenancies Act), educating both our landlords and tenants about the do’s and don’ts, ensuring they were not wrapped up in all the irrelevant media noise and providing them with clear and concise information. We had conducted our routine inspections and some home opens via a video call, had practiced extreme hygiene methods both inside and outside the office and amongst all this had managed to successfully launch our most recent project at Mari

“Adapting not to just survive, but to thrive.”

While this was a once in a lifetime learning curve that we will remember, it will shock you to know the WA residential rental market did not fall the way most predicted it would. Once COVID slowed down we saw a surge in leasing activity, rents had continued to climb, and our vacancy rate had continued to fall. Our retention for existing leases were maintained and our team became stronger and more supportive than before towards one another and our clients. The key component that drove this outcome was the incomparable team work we had demonstrated, always keeping in close communications despite working from home, yet ensuring we could still have a laugh and some fun along the way, regardless of the negativity being expelled into the world.

The biggest lesson we can take from the last 90 days (in my biased opinion) is recognising the human element in all of this. Learning to respect, support and work together through these times, appreciating each other and being grateful for the time we have amongst each other. The human element is one major factor that drives an economy, so share a smile and a “COVID hi5” to show your appreciation and support for one another.

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Fair Wear and Tear Explained

A final bond inspection is done at the end of tenancy to determine the final condition of the property and whether the bond will be refunded to the tenant.  When damage has occurred, it could be as a result of ‘malicious damage’ or ‘accidental damage’ both of which are the responsibility of the tenant or alternatively it could be treated as ‘fair wear and tear’.

‘Fair wear and tear’ is something that occurs through normal use or normal changes that take place with the ageing of the property.  It is a broad term and can be open to interpretation.  The Department of Mines, Industry Regulation and Safety defines it as “a general term for anything that occurs through ordinary use such as the carpet becoming worn in frequently used areas”… So where is the line drawn?  What is a tenant responsible for and what is a landlord responsible for?

If a bond refund was to be determined by the magistrate, they would consider the following;

• How long have the tenants resided in the property?  How many tenants have resided in the property previously?
• Age of the property, fixtures & fittings (i.e. age of the carpets or last date the property was painted, etc)
• Current depreciation status of the items in dispute
• How was the property presented to the tenant at the commencement of the tenancy?

Some grey areas that can be open to interpretation could include:

• Marks on walls, carpets, curtains, etc
• Holes in fly screens
• Cleanliness (i.e. oven, stove, windows, light fittings, light switches, skirting boards, exhaust fans, etc).

By being prepared you can help to determine the best outcome.  At Blackburne, we send the tenant a “Final Inspection Cleaning Guide”, highlighting the important areas that need to be addressed prior to vacating.  We use it to set an expectation in relation to what needs to be cleaned and any repairs that the tenant may need to conduct or organise prior to handing the keys back.

For a smoother, stress free end to your leases or to learn more, contact Blackburne Property Management today.