Things to Know About Looking for a Property in a Renter’s Market

A renter's market results from the supply and demand of rental housing, which has shifted in favour of renters as a direct result of the COVID-19 pandemic.

Sam Nokes, the head of property management at Jellis Craig Stonnington, explains to realestate.com.au that "supply is the quantity of rental properties; demand is the number of renters - at the moment there are more properties than there are tenants." We therefore have a renter's market because the supply and demand ratio favours tenants.

Nokes explains the various strategies tenants might use to benefit from this kind of market.

Would you like to speak to a specialist? Book a complimentary discovery session by calling: (03)999 81940 or emailing team@klearpicture.com.au.

You have more negotiating power

Tenants are unlikely to have the option of haggling over the specifics of their lease in a market that favours landlords. You might be able to negotiate a more flexible price in a renter's market.

According to Nokes, "it can mean that a more agreeable price bid would be approved, or it might mean that you obtain a better start date that eliminates some of your crossover costs between properties." "Depending on what you're looking for, it can just be that you can get a lease period that is longer or shorter."

But being in a renter's market won't make it less likely that you have a bad rental history or application.

It’s a great time to live in the city

The rental market has changed mostly as a result of a few "missing" demographic groups who would ordinarily be competing for available rentals. Expats are a key group in this area.

According to Nokes, "the executive-level ex-pat might typically rent larger family houses close to the city." Landlords and agents must look to other segments to fill in the gaps where that one is absent. Therefore, these houses might be more affordable for a local resident to move into.

However, these missing segments are not present in other markets. For instance, an ex-pat isn't likely to settle in an outer suburbia family house, therefore those markets will probably stay the same.

As a result, the inner city, where we observe a higher proportion of vacant rental units, is a terrific place to live.

Save on more than just your rental price

More than simply your rental budget can benefit from a renter's market. It can also include additional costs.

Think about your insurance or electricity expenses, for instance.

Nokes says, "If a tenant can get an apartment that is comparable to their current one in terms of size and cost, but they can add a garage, they'll definitely pay less for auto insurance."

"Similarly, moving to a more secure block could also lower this expenditure if you have renter's contents insurance and reside in an unsafe, walk-up building."

You clients typically save on your home insurance price if the car is left overnight in a garage.

Switching to a newer home with more energy-efficient equipment could result in significant long-term savings on your bills.

Get in quick

You'll want to buy now while the going is good in a renter's market.

"On September 13 [when stage four coronavirus restrictions are set to lapse], there will be a rush to market in Melbourne. Many individuals are waiting to perform those in-person physical checks, says Nokes.

"The best thing to do is be willing to take a property on a digital inspection and get it accepted before the end of Melbourne's lockup if you want to make sure you capitalise on this tenant's market before it turns back to a landlord's market later in the year," said one expert.

Be aware of the downside

Tenants should be aware that landlords may need to reclaim their losses at some point.

Mortgages are valued at the amount paid for the property when it was purchased, so just because the value of the property decreases doesn't mean the mortgage does, too.

Discover your sister suburb and save on your rent

Sister suburbs are geographically identical to one another in terms of their distance from the city, but they are frequently miles apart in terms of how affordable rent is, demonstrating the value of expanding your search while looking for a rental property.

We have retrieved a list of suburbs that are within the radius based on the direct line distance (as the crow flies) between the centre of the CBD and the centre of your suburb. Discover which suburbs your target suburbs are twinned with and whether they provide a better deal by using the interactive map below.

Rent and save

Long-term job market uncertainty means many would-be first-time homeowners will probably continue to rent for longer. Every dollar matters if you're renting while also attempting to save for a deposit.

According to Cameron Kusher, executive manager of economic research at REA, "there will likely be fewer first-time home buyers over the next years, and individuals will be wanting to rent for a longer length of time." The fact that interest rates are practically nil makes saving a deposit harder.

Having a buyer's mindset but a renter's budget, do you find yourself struggling to let go? Compared to the lifestyle-focused renters of the past, you could be more influenced by price.

The following similarities between sister suburbs in NSW and Victoria stood out:

Sydney

Eastern suburbs v inner west

The districts immediately east and west of Sydney's central business district unquestionably have different vibes. In particular, you are more likely to get those long-forgotten Sydney sea views if you face east.

Despite the fact that both have access to cafes, restaurants, and bars, one is noticeably more expensive, they both offer fairly similar lifestyle benefits.

There is a substantial disparity even in regions that are astonishingly close to the metropolis. For instance, while being only three kilometres from the Sydney CBD, the typical rent for a home in Double Bay is nearly $800 higher than in Waterloo.

Similar savings may be had by moving from Clovelly to Croydon, where rent is 57 percent less expensive, saving you almost $850 per week.

In contrast, a business in Newtown, Enmore, or Annandale is probably going to cost half as much as a unit in Point Piper, where the average weekly cost is $898.

Millers Point v Darlinghurst

One of Sydney's most renowned neighbourhoods for real estate is Millers Point. However, it is situated at the same distance from the CBD as Darlinghurst, a famous neighbourhood in and of itself, where median rentals are a staggering 31% less expensive.

Yes, Millers Point has one of the prettiest harbour views on earth. Darlinghurst is a good alternative, though, if you don't need a property with a view and are instead searching for greater access to schools, hospitals, and stores.

Melbourne

Bayside v north-west

Comparing these two areas is like to comparing apples and oranges in that there is absolutely no comparison. For those with varied priorities and hobbies, both provide very distinct lifestyles.

A tenant searching for a house in Brighton, Black Rock, or Beaumaris is unlikely to be persuaded to move to Deer Park, Albion, or Sunshine instead despite being equally far from the CBD.

However, if you need a cash boost, you would be considerably better off renting in Melbourne's north-west, especially if you work in one of the local businesses.

For someone who doesn't commute into the city, it might be ideal because there is a lot of industry near the airport and that region, according to Kusher.

Albion has a median rental price of $380 for homes and $280 for apartments, while Brighton, for instance, has a median rent of $1100 for houses and just under $600 for apartments. That's a discount of more than 50%!

Toorak v Kensington

Living in Toorak, where opulent houses and chic stores abound, is merely a fantasy for many Melburnians.

Kensington and Flemington, Toorak's sister suburbs, aren't a bad consolation prise, though, especially when you consider cost.

Both of these northwest suburbs feature a fair number of lovely homes, and they are both a little less than 7 kilometres from the CBD than Toorak. Dare we suggest that the cultural offerings of Flemington and Kensington surpass those of the far more sedate Toorak?

So when we say that a rental home will run you about half as much in these areas as it will in Toorak, it could seem like a no-brainer.

Flemington gives a 54 percent discount, while Kensington offers a similar 52 percent discount, taking $550 to $570 off the average rental house in comparison to Toorak. Good, huh?

Whether you live in a bustling neighbourhood or a more edgy area, contents insurance is essential to secure your belongings. Before it is pushed to the bottom of your to-do list, get a head start on it immediately.

Still uncertain about how people live in your sister suburb? Start chatting with local business owners, real estate brokers, and residents, and keep an ear out for information you won't find in a property listing.

What happens if your rental property gets damaged?

The truth is that even with the best renters, damage can still happen to a property because it can never stay brand new forever. As a house ages, wear and tear will happen naturally, but damage can lead to conflict between renters and landlords.

It can be difficult to define what "daily wear and tear" actually is. It can be difficult to determine who is responsible for what damage.

Here's what you need to know if the home you rent is damaged, whether you're renting from a private landlord or using a property manager's services.

If the damage occurred before you move in

You signed a lease on a piece of land only to discover that the damage was already there? There are techniques to make sure the repair bill doesn't bite you.

Here’s our guide:

1. Thoroughly complete your condition report

When you first move into a rental property, you must fill out a condition report form. You walk the entire house, making note of any damage already present. Correct completion of this is necessary to safeguard both you and the landlord.

Make a note of any damage, such as a sizable hole in a wall, so the landlord won't assume you caused it and try to deduct the cost of repairs from your security deposit.

Make sure the landlord acknowledges any prior damage by signing the form.

Check the entire house for any existing damage.

2. Report on urgent repairs

Additionally, it's critical to be aware of concerns like corrosion and mould, which could get worse over time, so the landlord has a chance to address them before they worsen.

Notifying your landlord of urgent repairs is required by the tenant's act in most Australian states, so this isn't just a matter of good manners on your part. To find out what you need to do, make sure to verify your state's legal requirements.

While you’re living in the house:

It's likely that you'll need to have the house fixed if you accidently damage it.

Here are some recommendations about what to do next:

1. Report any issues as soon as possible

Any persistent problems should be reported frequently. For instance, you should contact your landlord if you have a recurring mould issue. Mold may result in recurring, expensive structural problems for the home's owner and may have negative health effects on the neighborhood's occupants.

Such structural problems are typically the landlord's responsibility. Make sure you stay on top of things, and there is no excuse for not keeping the landlord informed.

2. Keep copies of rental inspection forms

Although the majority of landlords are fairly fair, it is imperative to safeguard yourself. Keep copies of any rental inspection forms so you have a record of the correspondence you had with your landlord. It is imperative to have proof that you are an obedient renter in case there are any serious conflicts down the road.

3. Keep a logbook of rental inspections 

According to Consumer Affairs Victoria, it is the landlord's duty and right to ask for a home inspection twice a year. Keep a record of these, along with any problems and fixes that occurred as a result.

When moving out:

There are procedures to take in order to ensure that you receive your bond back if you damaged a wall or broke a window when moving out of a house.

1. Make repairs before the final inspection

Repair what you can yourself, and leave the rest to the pros. It is recommended to complete this step prior to the landlord's final inspection. You have a far better chances of getting your bond back if you can perfectly repair any damage you caused to the property.

2. Locate your copy of the condition report

The condition report is useful in this situation.

If your landlord claims you damaged the property while knowing there was already damage, the landlord should have indicated it in the condition report and should have signed it.

3. Know the fine print

In Australia, landlord-tenant issues can vary and are slightly different in each state.

More specific information will be available from the pertinent authority in your state.

Would you like to speak to a specialist? Book a complimentary discovery session by calling: (03)999 81940 or emailing team@klearpicture.com.au.

Summary

A renter's market results from the supply and demand of rental housing. Tenants can benefit from this because they have more bargaining power. The inner city, where we observe a higher proportion of vacant rental units, is a terrific place to live. Expats are a key group in this area. Tenants should be aware that landlords may need to reclaim their losses at some point if a tenant fails to provide adequate insurance and valuables.

The typical rent for a home in Double Bay is nearly $800 higher than in Waterloo. A business in Newtown, Enmore, or Annandale is probably going to cost half as much as a unit in Point Piper. Clovelly to Croydon is 57 percent less expensive. If you move into a rental property and find damage to the inside of the house, it's likely that you'll need to have it fixed. There are techniques to make sure the repair bill doesn't bite you in the ass.

Report any persistent problems as soon as possible or report on urgent repairs. It is the landlord's duty and right to ask for a home inspection twice a year. Mold may result in recurring, expensive structural problems for the home's owner. There are procedures to take in order to ensure that you receive your bond back if you damaged a wall or window.