Top 5 tips for successfully working with a rental agent
Rentals are expected to continue to rise slowly in 2018 as the challenges of home affordability and stricter lending criteria tighten their grip, but it’s a double-edged sword as the Gauteng market will come under increasing pressure from declining disposable income levels and, albeit slower, semigration to coastal areas.
“Landlords are not only facing stiffer competition in the marketplace, but also a growing risk of delinquency as consumers are squeezed further and further,” says Shaun Groves, Rental Specialist in Gauteng for Lew Geffen Sotheby’s International Realty.
It is therefore more important than ever to secure quality tenants and to do thorough credit checks, even for clients with high income levels and unblemished credit ratings as the increasing debt-to-income ratio is putting pressure on consumers across the board.
According to Groves there are five key factors to consider when choosing the agent you work with as these factors significantly influence the calibre of tenant a property attracts and the time it spends on the market:
This is what first separates a property from the competition and it’s therefore important that a home should always be professionally photographed by a photographer with architectural/real estate experience.
Top tip: A high quality photography service can be more expensive which is why some agencies may skimp on this cost. Be clear about your preference and this being a non-negotiable factor.
Times are a-changing and it is no longer enough for agencies to simply post your property onto the internet and hope for the best. Social media plays an ever-increasing role in exposing your property to its potential audience. Millennials are the emerging buying market and the best way to reach them is through a medium they follow. However, it is a very competitive space so your agent must be proficient on these platforms and willing to spend the necessary costs of “featuring” your property. If not, your home will be lost in a vast sea of drowning properties.
Appoint a reputable agency with a history of successful rentals in your area. It should have a specialised rental division with an international footprint and relationships with top corporates, which is particularly important at the top end of the market. Unfortunately, South Africa has not yet caught up to the rest of the world in this market and the majority of local agencies give very little attention to their rental business, choosing to focus on their cash cows – sales. This results in poorly managed, under resourced, and ill equipped rental divisions which fail to tackle the challenges of this complex but vital side of the business.
#4 Professional Agent
Select an agent who is passionate and can take your property to the market with conviction and valour. Anyone can walk around a house pointing out the various rooms but that is not someone who has your best interests at heart. Additionally, property negotiations can be tough with everyone looking to get a deal, so choose an agent with the courage to say “no” and remember that the harder they fight to hold their commission is an indication of the level to which they will fight to get your rental each month and achieve a successful outcome should problems arise.
While we have all heard the doom and gloom stories around property rentals, the reality is that the law makes every effort to protect the landlord in the event of a non-performing tenant. However, one needs to make proper use of a lease agreement that covers all the aspects pertaining to rental properties and an agency that understands these laws and drafts a lease that is compliant with the RHA (Rental Housing Act), NCA (National Credit Act) and CPA (Consumer Protection Act).
“There are still excellent returns to be made in the rental market, but with Payprop’s latest Rental index revealing that Gauteng’s three-year growth ranking is only seventh out of the nine provinces, one cannot afford to be lackadaisical and hope for the best,” adds Lew Geffen, Chairman of Lew Geffen Sotheby’s International Realty. “It is therefore essential that investment buyers are savvy about where they purchase and do their homework before choosing an area and a property and landlords simply cannot afford to cut corners.”
The bottom line is, being a landlord is a full time job that requires even more dedication during challenging economic times. Unless you have the skills to manage your investment property yourself you’ll likely need the services of an agent. Don’t partner with the wrong “professional”.