NSW Time to start increasing rental amounts?

Discussion in 'Property Management' started by NG., 14th May, 2022.

Join Australia's most dynamic and respected property investment community
  1. NG.

    NG. Well-Known Member

    Joined:
    9th Nov, 2016
    Posts:
    150
    Location:
    Sydney 2219
    HI All

    In light of the latest RBA cash rate increase, and expectation for our end rates to essentially double by late 2024. I thought I revisit my property P/L's and do some basic forecasting.

    Are we seeing an increase in rental yields for Sydney Metro area? A couple of my tenants played the BS card saying they were affected by covid and thus a loss in income. As a landlord you cant really do anything else besides provide a reduction. Regardless I would like to start looking to increase rental expectation to at least what they were pre covid.

    Has anyone had success?
     
  2. serendip

    serendip Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    143
    Location:
    Sydney
    Newcastle property, rent increased 7% throughout COVID. Property Manager has recommended further 18% increase once granny flat build is complete, yes that includes losing a chunk of the backyard but also adding water usage into rent to save separate meterage costs.y

    What does your property manager say?
     
  3. Mel Morgan

    Mel Morgan Sydney Property Manager Business Member

    Joined:
    6th Jun, 2017
    Posts:
    1,448
    Location:
    Sydney
    It really depends on the market in your area, have a look at comparables on realestate & domain. Overall the sydney metro market has been improving since the start of the year and I'm finding most rents are close to pre-covid levels if not over in some segments.
     
    Travelbug likes this.
  4. Onyx_OCAU

    Onyx_OCAU Well-Known Member

    Joined:
    11th Jan, 2021
    Posts:
    208
    Location:
    NSW/VIC
    An additional resource:

    Rent Tracker

    Can breakdown into postcodes, number of bedrooms, etc. to see avg increases over the past 12 months. Also on the site are amounts for bond that are submitted to Bonds Online via Fair Trading (NSW), so you can gauge how much people are actually paying as opposed to advertised prices on Realestate or Domain which could be deceptive as asking prices are not necessarily the final rent price.
     
  5. Shazz@

    Shazz@ Well-Known Member

    Joined:
    24th Jun, 2018
    Posts:
    1,310
    Location:
    NSW
    Last year, my rents increased by 15-20%.
    This year, it will be a further 10%. I’m lucky my tenants can afford it. I normally feel bad increasing rents and try not to if they have been good tenants, but I have been a little fortunate that some of my tenants vacated which gave me an opportunity to raise rents to market value. For existing tenants, thankfully they are professionals.
    My properties are in regional NSW so it doesn’t answer your question. I know some people have been able to raise rents in Sydney, but others have not. So it probably depends.
     
  6. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

    Joined:
    18th Jun, 2015
    Posts:
    23,319
    Location:
    Sydney
    And rent increases could be impacted by some state laws which may seek to limit amounts of increases. NSW is the only state without limits on rent increases during periodic tenancies. There is pressure on each state to consider curbs on rent increases tied to inflation etc rather than supply / demand factors which could be used to impose increases. Other related laws may also mean a proposed increase can be refused and then an eviction would be retaliatory. Guidance by experienced PMs may avoid costly tribunal actions
     
  7. craigc

    craigc Well-Known Member

    Joined:
    25th Jun, 2016
    Posts:
    1,576
    Location:
    Melbourne
    This is also the case in Victoria, there are no limits however method of calculation must be provided.

    See Rent increases
     
  8. Fernfurn

    Fernfurn Well-Known Member

    Joined:
    23rd Jun, 2015
    Posts:
    214
    Location:
    by a Bellarine beach
    RE sent an email practically apologising our tenant had given notice, but the rent on the Gold Coast went from $475 to $650, top quality tenant by second ad.
     
    Angel likes this.

Build Passive Income WITHOUT Dropping $15K On Buyers Agents Each Time! Helping People Achieve PASSIVE INCOME Using Our Unique Data-Driven System, So You Can Confidently Buy Top 5% Growth & Cashflow Property, Anywhere In Australia