The new normal in real estate, the impacts moving forward.

The new normal in real estate, the impacts moving forward.
The new normal in real estate, the impacts moving forward.

We are now over 8 weeks into the “new normal'' and agents across the country have pivoted using online platforms for auctions, virtual platforms for routine inspections, virtual tours for vacant properties, balancing working from home and home schooling.

We are now back out conducting opens and on-site auctions with restricted numbers adhering to social distancing rules and the ever-present hand sanitizer.

We have dealt with the first wave of rent reductions and in most cases come to a commercially sustainable agreement between the parties.

Agents have communicated to clients – investors and tenants all the legislation changes, what it means for them, and for any new investors or anyone taking up landlord insurance for the first time what the exclusions look like.

We are now starting to look at what will impact our rental market moving forward, here are some of what is on my wall the moment:

  • Job keeper is to come to a close at the end of September, unless the Government changes their mind, when this occurs, tenants and investors are going to be impacted. Your property manager should be connecting now with tenants and investors to start discussing their current situation, will they be impacted by any changes to Job keeper and what options are available to ensure rent continues to be paid. 
  • It is likely that we will have higher vacancy rates which means that rental rates will be pushed down, do your numbers now and if your property is vacant during this time work out what is the minimum amount of rent you need to cover your costs.
  • If your tenant's lease is ending over the next few months, renew the lease and don’t increase the rent, you are better off having a tenant in your property at the current rent rate than a vacant property which you may have to lease out for less than the rent you are getting now
  • Be aggressive with your rent reductions if your property is vacant, get feedback from your property manager on what a competitive rate would be, sign on your tenants for longer than 12 months and build in a rent increase into the lease
  • Invest in virtual tours on vacant properties, our data tells us that on all of our properties people are spending longer on virtual tours before they attend openings.
  • Find out from your agent if they have invested in the latest technology, have they provided you and the tenant with an app to track your tenancy, to pay rent, to report maintenance. Moving forward people want to connect technology that enables them to report issues and have them dealt with quickly

This is a time for agents, tenants and owners to work together to get the best commercially viable outcome for all parties.

Sadhana Smiles

Sadhana Smiles

Sadhana is the director of Harcourts Move. Having worked in this industry since the early 90’s (yes she was 10 when she started) she has seen many different markets and understands that buying, renting, or selling is one of the most stressful things we go through in life.

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