Landlords and property investors get a bad deal in the mainstream press. It’s often conveniently forgotten that while they do benefit from tax incentives, they also provide the valuable service of rental accommodation to approximately 30% of the population.
If you squeeze property investors, the people who ultimately feel the pain are those you can no longer find a home to rent.
Of course, one reason why investors face criticism is the sharp trend in rental prices since Covid.
Industry researcher Cotality confirms prices have risen 44% in five years, and the median cost of a rental property in the capital cities is now $700-a-week.
Cotality’s data back in October found that vacancy rates were just 1.47% – even during Covid, vacancies were twice this rate. Only one in 68 rental properties was sitting empty back in October.
But that doesn’t give any investor permission to be a bad landlord. And a recent survey by rent.com.au offered great insight into how investors can keep their most valued tenants rather than suffer the steep expense of finding new renters.
The survey found renters were looking past basic amenities and focusing on fundamental experiences. Here are the four key takeaways for investors from the rent.com.au survey:
No.1 Close the communication gap
The foundation of a successful tenancy is the relationship itself – either with the investor or landlord, or their property manager. Some 40% of renters said they were “very positive” on this topic, while a third ranked their experience as “neutral or worse”.
This neutral ground is a risk zone – a place where minor issues can quickly escalate into costly turnover. The takeaway for landlords is simple: communication and respect are non-negotiable.
Lifting a relationship from “mostly positive” to “very positive” often involves minimal effort with maximum payoff. This includes clear, written updates on any major issues, providing advance notice for routine inspections, and setting realistic expectations about response times.
A tenant who feels respected and informed is more likely to care for your asset and commit to a longer lease.
No.2 Response is the new currency of trust
When it comes to maintenance, speed is paramount. Nearly half of renters commend their landlord or property manager for addressing maintenance issues promptly – usually within 24 to 48 hours. Nearly 20% said they had endured longer-than-expected waiting times.
For an investor, timely repairs serve a dual purpose – they preserve the asset’s value and are the clearest indicator of your commitment to your tenant. A clear, proactive maintenance plan to empower a property manager to act swiftly is worthwhile.
No.3 Liveability outranks luxury
Renters appear to be incredibly practical. When discussing what they most enjoy about their current homes, everyday liveability consistently outranked high-end fixtures or designer appliances.
The core values were – location and convenience, functional space, safety, quiet, affordability and stability.
This is a vital insight for your investment strategy. Rather than spending thousands on a new, high-spec kitchen, your investment funds are often better allocated to essential comforts. Focus on ensuring a property is secure, quiet and well-maintained.
Stability of pricing – a fair rent that avoids aggressive market hikes – is now a key retention tool.
Investing in the fundamentals of liveability – security, maintenance and a predictable cost – is the most professional use of capital.
No.4 Flexibility secures long-term tenancies
Flexibility has emerged as a decisive factor, often overtaking price in a renter’s decision-making process. For tenants, flexibility means longer leases, the ability to keep a pet and the freedom to make small modifications without fear of losing their bond.
Landlords who are willing to allow reasonable modifications, such as wall-mounting a TV, installing a garden bed or changing curtains, will significantly widen their pool of potential tenants.
Offering leases that extend beyond 12 months provides a certainty that renters actively seek. This also reduces the costly administrative burden and vacancy risk associated with tenant turnover.