This is one of the most common questions asked of property managers. It’s important to understand that, as your property manager, we are not the gatekeeper of rental values. Rental levels are determined by the market — in other words, what a tenant is prepared to pay for a given property at a given point in time.
To determine the appropriate rental value of your property at the commencement of a tenancy, and during a tenancy, we compare your property to similar properties currently on the market. We also take into account current demand for rental accommodation and the likely vacancy period.
During a tenancy, we consider these market factors alongside the way the tenancy is being conducted. For example, the market rent may indicate an increase of $5 per week, however you may have a tenant who pays rent on time and takes excellent care of the property. In situations like this, we will discuss with you the benefits of a rent increase versus the potential cost of lost rental income should the tenant decide to vacate.
We review your rental property a number of times throughout the year, and each review is undertaken with the above considerations in mind. Naturally, we will discuss current market conditions, the status of the tenancy, and the scope for both current and future rent reviews to ensure your property remains competitively and appropriately priced.