We recently had a client ask us to help him find a tenant for his property, one that he manages himself. This is known as a Casual Letting.
Most agencies don’t offer this service or when they do are half-hearted about doing so, presumably prioritising their energies on their management clients and relegating the Casual to a junior staff member and so on.
I’ve always believed that if we do something, we should do it well and exceed expectations. We use priority placement for the advertising, the same processes for open inspections, we assiduously check references and have a frank with conversation with the owner about their suitability, we produce a comprehensive Property Condition report with more than 100 photographs and we process the bond on the owner’s behalf.
This is a lot of work for not a lot of money. However, on the upside it develops a relationship with an owner who may one day choose to appoint us to manage the property or even sell it. It’s also a community service. Most owners don’t have access to any of the resources that we have to find and place superior tenants. They may not be able to afford professional management of their property.
Casual managements have become very problematic in recent times, as in many inner-city suburbs’ rents have dramatically fallen and vacancy periods extended significantly. We are working at least three times harder and longer on finding tenants for our management properties. It would be a pragmatic decision to stop or curtail Casual Lettings, but we haven’t decided to do this at this point. Our recent experience is a good example of the issues with casuals.
The client didn’t appreciate the decline in rental values, so insisted the asking rent be (significantly) above the market. Previously it had been rented at $580 per week for a one-bedroom apartment, but our view was the current market was less than $500pw. The client didn’t want to reduce by the amounts that were recommended. The marketing was criticized, the length of inspections and lack of interest in the property plus disparaged the two Senior Property Managers who were assisting. They conducted more than 35 separate OFI and private inspections for the property over a period of about 20 weeks. It finally let for $420per week – the current fair market rental for the unit.
There is no better agency than Marriott Lane for finding tenants, but not taking our price and marketing advice will result in a situation like the above.