Vacancy Periods | Minimising Potential Rental Loss
By DFJ Real Estate

Know the vacancy rate and market conditions.
As an astute investor, you must keep up-to-date with the current rental market and know the vacancy rates, trends and fluctuations. Vacancy rates are expressed as a percentage and are an insightful indicator of demand and supply in rental properties. Steady vacancy rates are considered between two and three per cent. A low vacancy rate (below two per cent) is viewed as a landlord market and is associated with rising rents and a decline in the time it takes to secure a tenant. A high vacancy rate (above three per cent) means there is a large portion of rental properties available where rents fall and there is an increase in the number of days the property is advertised for rent. The latest national vacancy rate is on an upward trend at 1.2 per cent, attributed to increased shared rentals to reduce rental costs and more people buying properties.

Know the current market rental value.
When the time comes to advertise and find a tenant, make sure you list the property at a fair market value. It may be tempting to advertise at a higher rate; however, you are likely to receive less interest. To determine the rent, compare similar properties of the same size and in the proximity of your investment property that have recently been rented.

Advertise at the right time.
The best time to advertise is two to three weeks before the property is available. If the property is advertised too early, your campaign may lose momentum.  
                                                                                               
Monitor the advertising enquiry.
If you are receiving minimal enquiries or, in contrast, a lot of enquiries and inspections with no applications, then this is a sign of an over-priced property, or there is something about the property that needs to be improved.

Pay attention to the presentation.
The presentation of a property is critical during high vacancy periods as tenants can be more selective. If there is an oversupply of properties on the market and your property becomes vacant, it may be time to repaint, update appliances, replace fittings and tidy the outside of the property. 

Offer an incentive.
During quiet times when tenant demand is low, consider offering an incentive to help make your property more appealing to prospective tenants. For example, offering one week's free rent can help a tenant financially when moving.

Consider additional inclusions.
Depending on the property type, you may attract more interest if appliances are included, such as a washing machine, dryer, dishwasher, cooling/heating, or fridge freezer. You could also offer free Internet or include pool and garden maintenance in the weekly rent.

Strategically plan your tenancy.
Avoid the lease expiring during high vacancy periods. You can do this by offering a 10-month term instead of 12-months.