Think long-term, landlords advised

Rental accommodation is currently in strong demand and landlords are in a strong position – but they should not throw away their advantage.

Tjaart van der Walt, CEO of the RealNet property group, says anecdotal evidence is mounting that tenants are showing increasing resistance to rapidly rising rentals and that landlords should carefully consider the benefits of a long-term relationship with reliable tenants.

“Tenants with good credit records know that they will easily find alternative accommodation if their landlords keep hiking the rent unreasonably,” he says.

“And while they will have to go to the trouble of scouting for another unit and face the expense and trouble of moving, their landlords will be left with the prospect of finding new tenants that may or may not be as punctual in paying the monthly dues.”

Van der Walt cautions that landlords should keep in mind the costs of finding new tenants. “In the first instance, there are advertising costs and costs associated with cleaning, repairing and perhaps repainting the property.

“A second consideration is that landlords do not earn rental income while the property is being prepared for new tenants and even at an increased monthly rental for new tenants, it will take considerable time to make up lost income.

“And thirdly, the danger of vandalism increases when properties are standing empty and the cost of temporary security measures should be factored in.

“In short, landlords are likely to find that after all the costs are added, they might well have been better off had they cut their initial trustworthy tenants some slack.”

Article by: www.realnet.co.za