Rental property market has gone through some difficult times with many tenants struggling to pay and becoming increasingly price sensitive. What should you do to get your property rented out?
Since lockdown 2020, the residential rental market has dropped off and vacancies have increased steadily. According to Catherine de Villiers, Rental Consultant at Jawitz Properties, the rental market is experiencing one of its most challenging times and several factors are contributing to this. “Covid-19 was definitely the major catalyst as it created vast financial implications and loss in people’s lives and livelihoods resulting in many tenants struggling to pay and becoming increasingly price sensitive.
The low interest rates also created an environment for tenants to become homeowners with a massive surge in first time homebuyers entering the market. These factors, as well as the many new sectional title developments coming on to the market, have resulted in an oversupply of rental properties. There are also countless furnished properties standing empty due to the lack of holiday rentals and expats coming into the country due to Covid and the travel restrictions imposed,” says de Villiers.
There are, of course, still good calibre tenants looking for properties to rent and de Villiers says that those landlords who adjust mentally to the current conditions and follow these top tips will more readily secure a tenant and not have their properties stand empty month after month.
1. Adjust your rental expectations
The glut of rental properties has impacted on the supply and demand ratio and pushed monthly rental prices down. Despite their still being demand, rentals have decreased by 25% on average across the board. With prospective tenants having lots to choose from, landlords need to adjust their rental expectations. “Take your agent’s advice as to a fitting price that will entice lessees. It makes sense to find a good tenant rather than have your property stand empty for months to come”.
A higher rental does not necessarily attract a better candidate of tenant. Tenants are looking for value and that value is determined by the market. Your agent will be best placed to advise you not only on the market but the calibre of candidate. Credit vetting is key in any market but more especially in the current environment.
2.Maintain your property to remain relevant
With tenants having the pick of the bunch, now is not the time to neglect your property. Take the opportunity, especially if it is standing empty, to modernise. A coat of paint, changing light fittings and door handles will go a long way. Take care of any needed repairs to maintain your property and to make it as presentable and desirable as possible. “We have found that tenants are more attracted to neat, clean and well-maintained properties that are flooded with light. It’s worth taking this into account not only when letting your property but also in terms of maintaining the value of your investment” explains de Villiers.
With corporate, expat and holiday rentals at a standstill, there are increased numbers of furnished properties standing empty. “With 90% of enquirers asking for unfurnished premises, landlords would open themselves up to a much larger pool of potential tenants by being flexible to removing their furnishings, if need be. My advice would be to work with where the demand lies”.
4.Welcome four-legged friends
There is always demand for properties with a private garden and pet-friendly complexes and homes. With so many competing properties, those landlords who allow pets widen the scope of potential clientele. Tenants looking for pet-friendly accommodation are generally willing to agree to clauses stating that any damage caused by pets will need to be repaired.
5.Security, security, security
As always, security remains a key factor and properties that have security systems and measures in place are highly desirable. Especially in the suburbs of Johannesburg, tenants prefer cluster homes or houses in gated streets or boomed communities. Making sure your tenants feel safe and secure is a sign of a good landlord and it often correlates with the condition of the property…and tenants pick up on this.
“It is important for property owners to keep in mind that tenants are very price sensitive at the moment, with many having to share accommodation. At the same time, the oversupply of homes available to rent has resulted in potential tenants being able to pick and choose from several properties at prices they can afford, so landlords need to re-evaluate how they go about attracting a good tenant that will stay the course with them,” concludes de Villiers.