Over December and January is a tough time to lease an investment property. With vacancy rates peaking early in the New Year, tenants have more choice and are in a better position to negotiate.
If you can avoid having to deal with your investment property lease renewal during the holidays, you’ll save yourself a lot of unnecessary time, money, and worry.
But if you must find new tenants during the holiday period, how can you best manage it?
Should you re-negotiate a new lease leading up to the renewal date, or leave it until last minute in the hope the tenant re-signs? What are your options if you learn your tenants are planning to vacate? What are your chances of finding a suitable tenant in a sea of rental properties?
It’s all about knowing when to renew the lease, and how and when to approach the tenant.
An experienced property manager knows how to best manage this type of situation and the discussions that need to take place to secure a lease renewal.
How best to manage your investment property lease renewal during the holidays?
Develop a relationship
Developing a good relationship with your tenant long before the lease is up can be the difference between a vacant property and a long-term tenancy. But if your tenant is leaving, having a good relationship means you will know the most effective way to communicate with them.
For example, the tenant may prefer email over phone, text or in person. Communicating with your tenants in the way that works for them shows respect and ensures you receive a timely response, which allows you to plan the next steps for your investment property.
The objectives for every property manager or landlord is to reduce the vacancy rate, secure suitable tenants and optimise rental return. There’s no point sticking your head in the sand until the lease renewal date rolls around to find out if your tenant is staying or going.
It’s best to be on-the-front-foot. By arranging a routine inspection three-months prior to the end of the lease means you can work out whether you want the tenant to renew or not. Once you’ve inspected the property, you can contact the tenant to ascertain their intentions. Starting the conversation early gives you ample time to start planning – either drawing up a new rental agreement or starting the process of finding a new tenant.
Know your rights
While securing a suitable new tenant is the top priority for property managers and landlords alike, it’s important that landlords know what they’re permitted to do.
If your tenant is vacating, when can you start looking for a replacement tenant?
The legislation states you can’t sign a new lease until the current tenant has vacated. This is where many DIY landlords can end up in hot water – they secure a replacement tenant before they’re legally allowed.
And when it comes to doing repairs and maintenance, typically DIY landlords do it themselves. But unless they have a license to carry out electrical and plumbing work, they’re most likely in breach.
Stay on top of repairs
Use the renewal date as a prompt to inspect the condition of your property and carry out any necessary repairs to either keep the current tenant happy or prepare for new tenants.
If the property requires maintenance work, avoid leaving the repairs to the last minute. It’s best to deal with them promptly and well before the lease expires. You don’t want to discover too late in the game that the tenant has been frustrated a maintenance issue all year, which may determine whether they renew.
Market your property wisely
Vacancy rates are at peak, so it’s imperative that your property is rent-ready and appeals to your desired tenant. Knowing how to present your property and where to promote it are essential to getting the cut through you need in a rental market with a lot of stock.
Experienced property managers understand which marketing channel delivers the best bang for your buck. Along with making sure you have great photos that match the presentation and condition of your property, creating an appealing ad, contacting their database, knowing when to hold inspections and how to competitively price your property.
Managing your investment property lease renewal of during the holidays doesn’t need to be a stressful situation. If you don’t think you’re equipped to handle a vacancy during the December and January holiday period contact an experienced property manager.
Now is the time to think about where you’re at with your investment property.