Property managers who are preparing for the next downturn could do well to learn from the strategies that are helping agencies survive the tough Perth market.
M Residential director Laura Levisohn told RPM that one important part of surviving tough times is to educate owners about market conditions so they will be willing to accept uncomfortable advice.
“I feel if my landlords are educated in the market and they are able to realise the worth of securing their tenant they will be more inclined to move with my recommendations,” she said.
“We also commence our lease renewal negotiations two months prior to the lease expiring and educate our clients as to the loss of income and the fees involved should the tenant vacate.”
Ms Levisohn said rents may need to be held steady or reduced to hang on tenants during challenging markets.
However, when it comes to securing new tenants, well-targeted incentives can be more effective than simply reducing the rent, according to Ms Levisohn.
“The fact is, tenants have four weeks rent held as bond in their current property and they have to come up with six weeks’ worth of rent for the new property; giving a saving here is a huge benefit, so we have been offering a week’s free rent,” she said.
We Love Rentals client relations manager Simone Kohli told RPM that property managers need to adapt their business processes to handle the sort of market conditions currently afflicting Perth.
“We have become extremely flexible in regards to viewing times of homes and have prioritised the processing of applications in order to ensure submitted applications are processed as quickly as possible,” she said.
Ms Kohli said regular communication with owners and existing tenants is also crucial during tough market conditions.
“In existing tenancies, we are in many cases successfully negotiating mutually beneficial lease renewal terms, which has seen many tenants reconsider their option of moving to a lower-priced home and avoided a vacancy period for the owner,” she said.