With the summer tenant moving season approaching, the team started to get very busy leasing to new tenants in November. Despite this, vacancy remains a little higher than experience would lead us to expect right now: this is particularly true in the rental price bracket $400 to $450 per week. Whilst this would be deemed an affordable level of rent for most, demand for property at this rent is weak. This is certainly unusual when set against years of past experience, and consequently is hard to fully explain.
For owners with this type of property, the only ways to stand out and be certain to attract a new tenant are: set the initial rental price competitively (even if that is lower than recent, and desired, rent); and, present the property to a standard above competing properties. The internet allows prospective tenants to be very well informed about what represents value, and they have no reason not to push hard for the best they can get: they turn away quickly and go elsewhere if, to them, value falls short.
In the market sectors above and below this mid-level rent, vacancy is about normal.
Eight new landlords have joined our portfolio in November, continuing the recent strong flow of new properties for us to offer to the market. Nevertheless, the need for us to find more is never ending. So, if you know anyone or any property that represents an opportunity for new business, please contact your Senior Portfolio Manager or Victoria Tunchon on 4861 0666.
We are also delighted to welcome Alanna Smith to our Property Management team. Alanna was brought up in the Southern Highlands, and has worked locally in Real Estate for several years. Alanna brings a wealth of local knowledge and experience in all aspects of Property Management and we are fortunate to have her join us.
November has been another good month for sales, rounding off a better than expected Spring for Highlands Property. However, November did start to show signs of some market slowing. Across the Highlands, the number of properties sold was only half the number of properties newly listed for sale, and days on market drifted out past 6 months: this suggests there is a good level of stock and adequate choice for buyers.
Despite the unbelievably low cost of money these days, the banks are clearly staying quite tough for those that need to borrow. Consequently, it is now common for the time and effort it takes to get from “deal done” to an unconditional exchange of contracts to blow right out. It’s quite likely that the widespread institutional reaction to the recent revelations from Westpac will bias towards even more caution, rather than the other way around.
The commercial market remains about steady, but is now showing some early signs of weakness. Vacancy has risen just a touch and enquiry for new tenancies has eased a little. That said, the Highlands market still seems to be faring better than national data would suggest.
The Highlands Property and CIPS Team