Tips to Reduce Vacancy in a Changing Market

What does vacancy really cost & how do I limit vacancy in my rental property?
Several things contribute to maximising the cash flow from your investment property, and one of the top priorities should be limiting the number of days the property is vacant. That means having only a few days turnaround between one tenant moving out and the next tenant moving in.

Price the Property Right First Time
Some investors want to ‘test’ the market with higher rent. Peak interest on listings is within the first 48 hours. If the initial response is poor then you should act quickly to change the marketing message, or bring the price back. If you wait you will limit the pool of quality tenants. The main thing to remember is that for every week of vacancy, you are paying the entire mortgage and holding costs out of your own cashflow. If this goes on for weeks, as it can in a tenant’s market, you will be putting a massive strain on your personal budget and often the gains you think you’re making from the eventual higher rent are actually negligible or negative come year end because of the extended vacancy period. The best rent delivers more money into your bank account over the entire year. When the price is too high, it can also attract tenants with much higher risk profiles.

Presentation
It goes without saying, but if the property doesn’t present well, it will not appeal to tenants. It will be vacant for longer, and it may also contribute to tenant turnover. Consider small things like getting the curtains cleaned or replaced, replacing hinges or handles, ensure appliances are functional and updated where necessary, paint internal doors and walls to modernise and freshen, create more storage. Ensure the grounds are tidy – attend to any large or scruffy shrubs, trees or hedges, top up metal on driveways or parking pads, straighten pavers and fix fences. The same way a landlord expects a tenant to keep the property well, good tenants appreciate and expect regular upkeep.

Be organised
Don’t put off what you know deep down needs doing. The market changes suddenly, so if you have studiously kept up to date with routine maintenance and small improvements, you will be more prepared when your tenant gives notice and you’ll have a better chance of achieving the rent you want with a quick turnaround. Otherwise, you might find your property struggles to compete. You might even prevent your good tenant giving notice in the first place.

Be flexible about certain terms
Allow your tenant to take in a boarder so they can pay the rent more easily. As long as maximum occupancy numbers are not exceeded, allowing this can be a win win.

Aim for fixed term agreements
Secure your income for pre-determined lengths by writing up fixed term tenancies.

Contemplate pets
There are excellent tenants out there with pets. We encourage you to not write them off, instead be open to it and make considerations on a case-by-case basis. We will ensure your tenancy agreement has all of the relevant pet clauses and protections.

Efficient management
Setting a new tenancy up for success takes time, and each step in the process needs to be diligently managed. Marketing should be both online and direct to contacts. Property viewings should be set at times that are convenient for prospective tenants. The application process should be easy as well as thorough. Your Property Manager has the tools, skill and experience to do all this and negotiate the best terms for you.