What Tenants Want
When buying an investment property it is important to purchase one that will be in high demand and receive premium rent. From my experience as a property investor and as a Buyers Advocate purchasing property in Melbourne, I can honestly say that there is no one hard and fast criteria to use as a guide to buying a property for rental that works across every suburb and every state. Each suburb we purchase in has it’s own set of unique preferences and as Buyers Advocates it is our job to understand the subtle shifts in demographics and what matters most to potential tenants (and homebuyers) in each suburb.
This week we follow the journey of one of our Buyer Advocates, Melinda, who is currently searching for a rental for herself, her two girls and her fur baby.
“It was an interesting experience inspecting properties with a tenant’s hat on, rather than the “buying hat” I usually wear when inspecting properties for our clients to purchase. Things I thought would matter most didn’t, and things I never thought would be high on the list were”
Let’s take a look at the surprising results so you can start viewing properties through the eyes of your potential tenants. Understanding these insights will help you choose appropriate assets which will rent fast and for top dollar.
Here are Melinda’s highest priorities
1. Bedroom Sizes
With two children approaching their teen years, size of bedrooms matters.If a 3rd bedroom was 3 x 2.5m it was too small for a family with children who were in or about to hit their teens. A good bedroom size for families with older kids is a minimum of 3x3m.
There are areas and property types where a 2.5m x 3m bedroom would be acceptable. Which proves that it is important to understand the demographic of an area and who is likely to rent the property you are considering buying as an investment.
Busy professionals want a dishwasher. Ain’t nobody got time to hand wash dishes these days!
3. Heating and Cooling
Melbourne is cold, heating is a must for rental properties in Melbourne & Surrounds. When a property doesn’t have sufficient and ample heating the number of inquiries and rent price suffer. Equally important, particularly in the western suburbs where it gets very warm, is cooling. In some suburbs, adding a $60 fan can add $5 – $10 pw more to a property and make it stand out above other options on the market that doesn’t have a fan.
4. Built In Robes & Storage
Storage is often in short supply for rental properties. In older houses in particular the linen closet, bathroom and kitchen storage can be limited. Along with this, in inner areas and many outer areas too, houses do not have a garage.
Including a small shed on your rental property can make a huge difference when it comes to meeting the needs and desires of your tenants. Also, building additional shelving and storage in the bathroom and kitchen will always be a hit with tenants. You can never have enough storage.
As a single parent with two children, it was important to Melinda to have her girls bedrooms close to her own for security purposes. This priority is unique to Melindas circumstances and there would be other families who would prefer the children’s bedrooms away from their own or in their own wing, and for tenants sharing with house mates a separation of the bedrooms is considered a positive.
This just confirms how important it is to understand the demographic of the area you will be purchasing in for investment purposes.
Three Surprising Results
Melinda expected to be more concerned with security.
TIP – Safety is usually very high on the list from our female home buyers, and this is the same for women renting.
Don’t dismiss this factor if you are buying in an apartment block or an area that isn’t family friendly and considered very safe. In this case Melinda’s chosen suburb and property type tend to be very secure, which is why security made it way down the list.
2. Kitchen and Bathroom Presentation
While everyone loves a gorgeous new kitchen and bathroom, many tenants won’t pay more for the luxury. So long as both are functional, safe and feel clean most tenants are more forgiving of an outdated bathroom in inner city locations.
On the other hand, when selling a property, it is important to note than in many instances a buyer will pay more for a newly installed bathroom and kitchen. This is where understanding your strategy and timeline also play a role in your asset selection.
TIP – In newer estates and suburbs you will find that there will be higher expectations for the bathroom and kitchen.
3. Floor & Window Coverings
“Didn’t care, everything else was more important”. I guess when you put it like that, the other items on Melinda’s hit list really are more important.
Finding The Property Tenants Want
When purchasing an investment for our clients we have an index of items we look for. There are subtleties of the criteria that does change dependent upon the region in Melbourne we are buying in, the suburb and our client’s overall investment strategy.
As a savvy investor it is wise to understand the foundational items that are a must in every property as well as the unique and subtle variances for tenant and buyer preferences in each suburb you consider.
Sticking to a blanket approach and the same checklist for every suburb will delay your results and keep you out of the market longer. Learn to be fluid in your approach and adapt to the playing field you are playing on.
If you would like help to select a suburb and property type to meet your investment goals and investment strategy our team are available to assist. With the resources we have access to and the databases we have built ourselves coupled with our unique approach to asset selection you can have your shortlisted suburbs and know exactly what property type to target within a week of speaking with us. Buying a property can be really easy with a little help on your side.
You can learn more about our services by booking an obligation free chat today.
September 28, 2017 Uncategorized