Australia is on it’s way to becoming a nation of renters. With property prices rising, especially in the urban and suburban areas, people are beginning to not just remain on the renter ‘treadmill’ but find it the most appropriate choice for the current predicament.
The Australian Bureau of statistics found that 71.4% of Australians owned/mortgaged their home in 1966 as opposed to the 69.8% in 2006. Although that is only a 2% decrease over 40 years, it is an over 2 million people difference that are living in rented accommodation.
So as the renting population increases, the landlords decision on which tenant occupies their property can become confusing and a bit overwhelming. When choosing your tenant; keep in mind there are only two factors you need to consider.
1. Their ability to pay the rent for the property
2. Their ability to ability to care for the property.
Here are a few tips on how you can ensure these two factors are met and make your decision a little easier.
Figure out your audience
Before you even start advertising and searching, it’s important to have a solid idea of the sort of person who will be attracted to your property. For example, a place surrounded by parks, schools etc. will be typically be attractive to families, where as an area with restaurants, cafes, and bars is more likely to attract a younger tenant.
Take care of your property
An obvious, although ignored principle. A property in decent condition is going to attract a more decent tenant. You don’t have to have a million-dollar property in a great location to attract the best tenants. You just need a property in the appropriate condition that is clean, tidy, and importantly, all fixtures and fittings in working order.
Take a note at inspection
During inspections write down or at least take a mental note of who is who. Were there parents who had children yanking at curtains and kicking doors and made no effort to stop them? These may be tenants you should avoid. The nicely dressed couple who had their application ready to go as soon as they walked in the door? They might be perfect.
Read between the lines
An application that shows 4 different properties in 18 months may seem great because of the 4 references, but should alarm bells be ringing? Of course, they should.
Distinguish whether the references are genuine. Contacting previous landlords or property managers is a great idea as their incentive lays with no one, if anything they may empathise with your position.
Also make sure things like if their bond was paid back in full and if not why? Did they pay their rent on time? Did the last landlord or property manager issue the tenants any breaches notices? If so, what was it for?
Double Check all ID provided until you are convinced they are who they say they are and check with their employer that they are currently employed and earning the amount as stated on the application.
Appoint a Property Manager
Consider hiring a good property manager to manage your investment property. A quality real estate agency should have access to database of blacklisted tenants (e.g Tenancy Information Centre Australia) and past debt recovery records which can show you whether these potential tenants have any outstanding or past issues worth considering before taking them on.
Mulligan Property Group has a strict tenancy application process. All applicants must complete our application form and provide 100 points of identification, proof of income, personal references and proof of previous living arrangements. We verify the applicant’s details as part of the application process and will discuss all tenancy applications offers with you.
This also isn’t necessarily the end of the journey with us, as we will continue to assist with the management of your property throughout its life with us.