There’s a pretty big urban myth going around in the rental property game. Property managers are just as guilty of spreading it. The perception that every rental property should be advertised at the beginning of the year isn’t as true as you probably might think. Sure, it’s the time of the year when the media love to scrutinise property managers, as headlines of tenants queuing up for rental property, and students not being able to find flats because of the shortage of homes hit the news; but the reality of it is, summer is not the only time to advertise property. It is true though that certain properties command more attention at certain times of the year. Knowing when your property is best suited to be advertised could save you a huge headache, get you the best quality of tenant and guarantee your portfolio success for another year!
Ok, so we may have lied a little bit to get your attention. It is absolutely true that the buzz of the rental market comes alive in the summer months. The influx of students moving into Wellington and the expiry of many fixed term leases means that there’s a larger number of prospective tenants in the market than there would be at other times of the year. However, these are often a particular type of tenant. Those with families, looking to get settled for the school year are often attendees to open homes at this time of the year. Families can find it difficult to find a property in the right school zone, so if you’re aware that you own a property in one of those zones, summer can be a great time to list.
Similarly, young professionals in group flatting situations are often looking around this time too as the new year can be a time of change in their jobs. The larger homes, four bedrooms and above, are often the ones that are hard to come by around this time of year as there are a disproportionate number of tenants looking for this style of home. Between families, groups of young professionals and students, the demand for this type of property surges between October and March and this is the best time to advertise your larger investment property with more than three bedrooms.
Not to worry though, it isn’t all bad news if you’re the owner of a smaller property. If that’s a one or two bedroom apartment or townhouse, the demand for these style of properties seems to be pretty stable throughout the middle of the year, as younger couples or singles can be slightly more transient. They don’t have the commitment of needing to be in a certain school zone and they don’t need the space of a larger group of people. Instead, they prioritise having a great place to call home, that’s close to the things that are important to their lifestyle. Demand for one and two bedroom apartments in the city has, of late at least, been through the roof. The great thing about tenants who either live as a family or a couple/single or more mature tenants is that they often hold these tenancies for a long period of time – a huge benefit to any property investor, compared to group of students and young professionals that are not related and tend to move around more frequently.
If you’re thinking of renting out your family home for whatever reason though, don’t feel constrained by the time of the year. High end, executive level rental property and beautifully presented family homes maintain a great level of interest throughout the year. At Tommy’s, we have a large number of these style of homes on our books, and find that properties priced $1,800 per week and above continue to gain great interest. These homes often suit embassies and can attract both great rents and tenants alike, and frequently longer-term tenures as well.
In the past, to market a property in the winter would have been considered foolish. However, with the continual importance placed by both Government and prospective tenants on a home that is warm, dry and safe, if your property is insulated, has plenty of heating, is double glazed or gets fabulous all day sun, then winter can be a great time to show all of that off to the tenants that come through your property.
It would be wise then, to review the tenancies in your existing portfolio, or to be open to flexibility on existing tenancy end dates suggested by your tenants if you have a property which may benefit from being marketed at a different time of the year. Moreover, if you have a diverse portfolio, consisting of multiple properties, then spreading the risk around the year is a great way to reduce the potential damage caused by the slowing down of the market. If, for whatever reason, you have tenancies which all end at the same time, consider when your properties might suit being re-advertised dependant on the demand for that style of property at the time of the year.
For obligation free advice, and to find out how you can sharpen up your bite in the rental market, give us a call anytime on 04 381 8604 or email us.