Welcome to our December Perth Property Update where as well as a full update on the Perth sale and rental market we also bring you a unique perspective this month on how we are getting premium sales results in this buyers market by “Selling the Sizzle” and not just the sausage, covering some great tips to remember when next selling a property.
Plus in the area of property management we take a deep look at the fear some landlords have around charging their tenant full market rent at all times.
Sale Market Update
The market has been stabilised by 2 successive rate drops leaving the number of available properties on the market steady at 15,300 for the 3rd month in a row. (source: REIWA.com)
The number of sales per week reached averages of 1200 across November, as the flurry of spring properties hitting the market were snapped up. Leading into December, sales volumes have tapered down to the high 900’s per week, which is 100 sales per week on average higher, compared with the same time last year.
Over the last 4 weeks I have had the pleasure of meeting a lot more buyers out and about at home opens. With 10+ buyers across two days being the normal level of inspection for a new property to the market. However finding the genuine buyers who are ready to make an offer is still rare as gold… I’m just getting much better at panning for it (see feature article below).
In some cases we are getting very strong home open numbers but finding that the market is still extremely price sensitive but as soon as we get within 2.5% of the general market price opinion a sale occurs very quickly. When priced outside of this range, buyers are purchasing other properties that represent better value.
After this weekend the market will shut down for two weekends, for Christmas and New Year. As it cranks up again we will see a flurry of new listings to the market again with buyers not normally coming out to buy in numbers until the end of January, early February…. However the genuine ones that want to finalise a purchase before the start of the school and work year will be out.
Rental Market Update
We have seen strong rental demand continue over the last month with Nicole, our leasing specialist securing over and above asking price for a number of new leases.
Unlike some owners beliefs, asking market rates does not mean we have to compromise on tenant quality (see feature article below for more). Wherever the market is at, we focus on getting the best from it, as quick as we can, with little to no vacancy.
It certainly has been a great time of year to have your tenants lease run out and the rental market in January-February is usually just as hot!… but the next 3 weeks is not a good time for finding a new tenant as the rental market takes a break for Christmas with only those in desperate need of new accommodation out looking.
We purposely write all of our leases to expire in November or January to avoid a tenant change over in December. Does your property manager take the same care?
“Selling the Sizzle”
Over the last 2 years home buyers have been spoilt with a smorgasbord of choice and the sausages have all been “On Sale”.
Instead of focusing purely on selling the sausage and being compared by the market as a commodity…over recent months I’ve been investing more and more time & energy before we go to the market to give each property the best chance of being sold quickly because the longer we are on the market, the lower the demand and competition and the lower the price achieved for my owner.
So how am I creating buzz and making a property sale sizzle?
- Discover a properties best selling points- Through an in depth owner survey I draw out all of my owners favourite things about the home, why they purchased it, what their friends like about it, the improvements they have made and more. Then combining this with a close inspection of the home and area and discussion with the owner I am able to discover and target our marketing campaign to a properties best selling points.
Being unique and memorable– your home must stand out and stick in the mind of those inspecting it online. I aim have to peak their a buyers interest but create a set of feelings and expectations that can be met when inspecting. Here I use professional photos, targeted advertising copy, themed fun action shots showing the selling points off, premium postcard invitations from you to the whole suburb to attend our home open, and a custom micro site dedicated to your property which is easy to remember, search engine ranked to boost online inspections and create exclusivity.
Create extra buzz with a promotion– what a better way to highlight the selling points of your area than for me to come to an arrangement with a local cafe to giveaway free coffee, the newsagent a free paper and for my latest promotion Jetts Fitness to give away a grand prize of 12 month gym membership valued at $595 and a 3 day free pass to each home open attendee. This extra buzz and energy around the sale translates to increasing buyer demand and creating a great relationship with everyone that come through, I am sure of it!
- Giving value to every home open attendee- The giving does not stop with running a promotion, I have designed my whole selling process to give and help buyers and sellers with their property decisions. Providing many free reports, sales data and having a genuine interest with how I can help with their property plans.
All of this adds up to your home sizzling so that it can be heard and smelt across the whole suburb… Sausage anyone?
I don’t want to charge full market rent!
We all want to have good tenants in our rental properties. A property manager’s main purpose is to ensure right from the start that quality time has gone into ensuring each prospective tenant’s rental references have been thoroughly screened, employment details confirmed and details checked against the national tenancy default databases available.
We commonly deal with landlords who want to keep the rent down below market rates because they have great tenants and do not want to upset them by charging more.
Though on the surface this action seems admirable, we need to look at it realistically. Firstly, some landlords have a fear that if they increase the rent to full market rates, this will upset their good tenant causing them to leave (for example at the end of a fixed term agreement). However if the tenant did have to vacate because of having to pay full market rates, and move to another property elsewhere, it is likely that they will also have to pay market rates for their new rental accommodation.
The cost of relocation is also a consideration. Moving costs can be substantial and arranging for their utilities like electricity and phone/internet to be connected, usually with disconnection and new connection fees also adding to the stress of moving, it would certainly be a costly and uncomfortable exercise to consider just because they have to pay market rent!
It makes sense that we need not fear keeping rents at market rates, as this is not likely to be a factor that would motivate tenants to leave a property. Tenants leave properties for all sorts of valid reasons, however we can rest assured a tenant is not likely to leave because they are being asked to pay full market rates.
However you choose to spend the Christmas period, I hope you enjoy it, relax and reset for a BIG year in 2012. It’s one of the few times of the year that I get to have a week off so I can’t wait to see all my family and do absolutely nothing.
I hope you have gotten some value from this month’s Perth Property Update, I would love to get any feedback you have or requests for future feature topics so please post your comments below or send me an email at firstname.lastname@example.org
If you are weighing up any buying, selling or renting decisions I am only too happy to help you work through your options to get the best and most profitable result for you. My contact details are here.