Competition from new Apartment completions, inner Sydney

Hi all,
I am looking at end of lease rent appraisals for September '16 and early next year, and I am a bit concerned that a property very similar to mine (workers cottage ) hasn't yet been rented. Vacant over a month, Started asking $850 and and has been reduced $820 weeks ago.
There are ' a zillion' ( my exaggeration) new apartments nearing completion, in Redfern, Waterloo and Green Square.
While none of these are a 'charming' heritage workers cottage, I think they are taking up all the slack in demand.
I think the demographic is altering!
Is there any where I can look up estimated completion dates?
I usually try for an Early February lease renewal ( Used to be when the least competition was available!)
When should I negotiate my leases to expiry ?
thanks everyone
SeafordSunshine

 

For the next 12 months, sydney rental market will be under great downward pressure. I noticed some neighbouring suburbs' for rental list has jumped from 30 to 80 due to building completions, and this is just the beginning.

The rental supply will remain high for couple of years until they are absorbed by new immigrant arrivals and new family formations. If your property is located in one of those oversupplied areas, I would suggest to lock in as soon as possible even at a bit less rent. Just 2c worth.

 

Thanks Kanga, the one adjacent is speaking volumes about Market Demand!

 

Yep downward pressure until people start trying to rent/buy somewhere else.

Trust me if someone is renting at $600pw its not because they cant afford it to go to $630pw OR they will go out and buy one of those spanking new apartments.

For people to say rents are going down to vacancies they are wrong, rents are going down because interest rates to purchase are low (eg easier to get into ownership).

The only problem is that if most people haven't made the move yet......then they don't have the deposit etc to make the move so putting the rent up 3-5% may lose you a tenant for a week or two but someone will get sick of trying to buy and decide to rent your place out.

@Seaford.......I would be looking closer to home for the reasons your place hasn't rented out.

1/ ****** property managers.
The amount of times you see a rental listing with one or two photos and crappy lighting etc as well.

2/ Bad marketing.
You're place is vacant for the last 2 weeks.....huh? when did you start listing it?
I always contact agent 10 weeks (70 days out) with the following schedule;

70 days out….contact agent and ask for an inspection to happen within the next 7 days. Perform market analysis and within 7 days decide if want to renew and on new rent rate

63 days out…..serve notice with tenant request to renew lease 30 days to decide

If the tenant doesn’t renew on 33rd day give “30 days notice” ending fixed term asking them to leave

Show property 28/21/14 days out

If tenant renews……new lease kicks in with increased rent on the first day of new annual lease.


3/ Maintenance.
Be honest.....is the property worth $820pw or does it really need a few thousand in repairs/touchups to bring it back up to rental ready.

Those flashy new tiles in the highrises look pretty good as a backsplash.

You don't need to bring everything up to 100% (that's for when you are going to sell it) but you do need to make a maths calculation on should I renovate or should I lower rent.......


Lastly.....winter is a ****** time to find new tenants.....especially in older style windowless 'heritage cottage'

This said......stick with it, I think the edge will get knocked off those new highrises pretty quickly and people will yearn for the heritage style properties again with excellent noise/advantage of not hearing your neighbours parties etc.

 

lol @Seaford interesting timing...

- The struggles everyone living in a high-rise apartment know to be true

 

Completely disagree with this, or else I don't understand the argument you are trying to present. It comes down to simple supply vs. demand. Too much supply, you are going to struggle to get a tenant quickly. Even if the number of tenants in an area remain fairly static, (unlikely to be a huge influx overnight), then if a lot of new apartments come online (and at attractive rates too as they need to attract tenants) then of course there is a large sector of tenants who will decide to move from an older rental to a new one. Every day without a tenant costs you money.

You can try an out of the box idea, or look at timong lease renewals to when it peak time for tenants to be looking. I would speak with local property managers to understand when that is.

 

Thanks, all,
thankfully it's not me with the vacancy,
I think looking at timing vacancies should help. I'll go with the usual back to uni dates!
As for the $820 pw 2 br terrace near me, its been reduced to $790, it does look a bit tired in the pictures, it could do with a spruce up.
Given it sold for 1.1M it's showing a small %return. I would be looking at reducing the rentals , just enough to get someone in till Uni!