Hi there
I have a two-bedroom unit in the eastern suburbs of Sydney and the tenant has requested a three-year lease at a slightly reduced rent than the rate currently being paid on a six-month lease.
Given the current high vacancy rates this initially seems like a good idea, however I am reluctant to lock in a low rental return for three years.
I would be very interested to find learn from any other people who know more about the pros and cons of longer leases on residential property.
regards
Robin
Hi Robin
I don’t know much about NSW law but in VIC if you have a lease that is longer than (I think) 5 years and 10 days then the Residential Tenancy Act doesn’t apply and you can then make the tenant responsible for rates, insurance etc. So if your rental is lower than the going market rate, that is okay because you are not paying the outgoings on the property.
I also believe that it is possible to have rental increase options in a lease that is for more than your standard 12 month term.
You probably need to check this out with your lawyer.
Good Luck with this
Nessie
Hi Robin,
With the current climate as it is and the renters bargaining for what they want to pay in rent, it would make good sense to negotiate with them as if you were to lose these renters, how quickly could you get someone to replace them, at what cost and what rent would the new renters want to pay. It’s a tricky climate out there and there are many differing views on what’s going to happen in the property market both in short and long term.
Next best thing… What does your gut tell you to do? How do you feel about the current renters? If they look after your property they may be worth a cut in rent..However let them know that the reason you are giving the rent at a reduced rate is in appreciation or as a reward for their excellent track record (or make up some such reason to suit your situation) It just might be a mindset for you of keeping control…After all it is your property!
Aaaahhh the games we play…
Check.. Check Mate
Soosh [:0)]
P.s I hope this may help some, I unfortunately am not a professional in these matters, but good luck anyway [
] !It’s all our imperfections that make us perfect!
Hi Robin,
I was curious as to what you decided to do. I’d love to hear..
A very curious
Sooshie [
]It’s all our imperfections that make us perfect!
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