14 September 2022
Welcome to our next video series of Cunninghams Market Minutes with John Cunningham and Emily Crosweller.
In this edition of the Cunninghams Market Minutes John and Emily answer some key questions around Property Management and how a range of factors are impacting investors and investment properties.
Some key topics covered include:
- How are interest rates impacting rents?
- How are tenants responding to potentially higher rents?
- Reasons why you should trust you Property Manager in this market, and
- Some advice for Landlords when it comes to investing.
We hope you are enjoying our market series and keep a look out for more to come…
Transcript:
John Cunningham:
Hi, it’s John Cunningham from Cunninghams, and this edition of Market Minutes, I’m talking to Emily Crosweller from our Property Management Department. We’re going to talk about what’s happening in the rental market as we move into spring.
So, Emily, there’s been a lot of talk about interest rates in the property market. Do you think that has any impact on rents? Do we see rents increase, or is there something different at play there?
Emily Croswelle…:
I think it’s a little bit of a different market, John. I feel that interest rates are not really coinciding with the rental market on the Northern beaches. They’re kind of in a little mini market here as opposed to the rest of Sydney. And I do feel that landlords are trying to increase rents to coincide with the increases in interest rates. However, it’s just not meeting, unfortunately, just in our current market.
John Cunningham:
So, it’s more about a supply and demand issue, isn’t it? There’s a lot of supply for tenants to look at, that affects the rents more than anything else.
Emily Croswelle…:
Absolutely.
John Cunningham:
Yeah.
Emily Croswelle…:
Yeah, definitely.
John Cunningham:
That’s really interesting because so many people think one has to relate to the other.
Emily Croswelle…:
Yes.
John Cunningham:
But unfortunately, sometimes it works one way, sometimes it works…
Emily Croswelle…:
That’s right.
John Cunningham:
… the other. So, we’re really seeing a reasonable stabilization in rent still, aren’t we, at the moment?
Emily Croswelle…:
We are. Yeah, we definitely are.
John Cunningham:
So, when we look at that landlord situation where they’re obviously needing the rents to increase to cover the increased mortgage costs, how are tenants responding to that?
Emily Croswelle…:
They’re looking for something that’s got a lot more quality in what they’re paying for. So, tenants used to kind of not really care too much about where they lived because they didn’t spend so much time at home. But since we’ve gone through COVID, people living at home, they’re there more. They want to have that whole experience and to make it feel like home and not a rental.
John Cunningham:
So, therefore, it’s very much the quality of the product.
Emily Croswelle…:
Yes.
John Cunningham:
And if you present a quality product, you’re more likely to get a higher rent.
Emily Croswelle…:
And a quality tenant as well.
John Cunningham:
So, it does hand in hand, doesn’t it?
Emily Croswelle…:
Yeah.
John Cunningham:
People wanting to invest in their property, one of the really big things that we say to landlords that once you buy an investment property, you don’t stop investing in it.
Emily Croswelle…:
No, you don’t. It’s not a so much set and forget as much as you’d like it to be. It is something that is quite consistent and you need to be on top of.
John Cunningham:
That’s great. I think that’s a big shift that’s occurred particularly in the rental space is that, our rental market is so broad now in terms of who’s renting. People are renting short term while they build a home. They’re renting temporarily before they buy another property. It’s not just people living in a rental market, it’s actually people across a broad spectrum of the property market.
Emily Croswelle…:
That’s exactly right.
John Cunningham:
Yeah.
Emily Croswelle…:
Yeah.
John Cunningham:
So, Emily, we’re talking about landlords and looking after their properties and making sure they present it well. There’s a lot of things to go with that, isn’t it? Vacancy rates is a big one, which is the time it takes to have a property occupied. So, how critical is it that landlords listen to the advice of their property managers?
Emily Croswelle…:
It’s so important, John. We find that we are able to rent properties at a higher rate quicker than the rest of the market. Our marketing also comes into play with this. So, professional photos, property spick-and-span clean, having all the repairs and renovations done prior to advertising and having the first group of people come through because presentation is key, as you would know.
John Cunningham:
Yeah. You only get one chance to create a good impression, isn’t it?
Emily Croswelle…:
Exactly right.
John Cunningham:
And then each day that a property’s empty is one day of less income.
Emily Croswelle…:
That’s right.
John Cunningham:
So, we just try and minimize that as much as we possibly can. And that’s so often through presentation and making sure the price right, isn’t it?
Emily Croswelle…:
Absolutely. Yes, definitely.
John Cunningham:
So, Emily, to finish up this interview, I’d like to talk about what advice you’d like to give new landlords entering the property investment market.
Emily Croswelle…:
I would like to give them the advice to have the capability and the funds available to maintain your property because it is an ongoing investment. Things will go wrong, repairs are needed. It’s just something that a lot of people don’t think about. They think it is a set and forget. And as you mentioned before, and I mentioned as well, people wanting to live in a home. It’s not just a rental. So, these things do come into play. What do you think, John?
John Cunningham:
Well, yeah, it’s interesting point. I’ve been a landlord myself. It’s sort of so important to make sure that you’re actually are creating a home for someone and understanding that they want to feel like it’s a home. And then, you get a tenant that stays on, pays rent well, looks after the property. All those thing’s part when you approach it the right way. So, if you take the right perspective on being a landlord and looking after your tenant, they’ll look after you in return.
Emily Croswelle…:
That’s right.
John Cunningham:
So, it’s a two-way street.
Emily Croswelle…:
Yeah.
John Cunningham:
It’s been great talking to you, Emily. Thanks so much, and hopefully, our viewers will get some great benefits out of what we’ve talked about today. Thanks very much.
For more insight, please contact Emily here
For other Market Minutes you can watch the videos here
