Propertylogy’s head of research, Simon Pressley, believes that a simple yet structured process, as well as forward planning, could ultimately allow investors to maximise returns from their rental properties.

He provided eight tips that landlords (and their property managers) can follow to garner greater returns:

1. Be the captain

Mr Pressley encouraged landlords to take an active role in the leasing process – working alongside their property manager instead of simply being dependent on their services.

He advised them to make sure that they have all the necessary information to be able to make smart decisions about their investment, particularly regarding rental incomes and lease renewals.

2. Begin lease renewal early

According to the researcher, the lease renewal process should begin three months before a lease expires to avoid extended vacancy.

Within those months, the landlord should be able to establish whether the tenant will stay or go. Ultimately, documentations should be finalised at least a month before the lease expires, Mr Pressley recommended.

Where the tenant does intend to move out, he advised beginning the rental advertising campaign three weeks before the existing lease does end.

3. Make a good first impression

When advertising a property, Mr Pressley said good quality photos are critical.

In the same vein, a good advertising description is crucial – to highlight the features of the property. It can definitely be worth paying extra advertising fees in order to boost online exposure in some scenarios.

4. Consider basic renovations

While major works are not often necessary, basic cosmetics such as freshly painted walls, carpets, curtains and polished floorboards can boost the rentability of a property. In some cases, a cost-effective kitchen makeover and installation of a new air-conditioner will also help in maximising returns.

5. Keep an open mind

Once tenant applications come in, landlords would do well to keep an open mind, such as with regard to pets. According to Mr Pressley, more often than not, the willingness to accept pets can result in higher weekly rents or lower tenant turnover.

Where this is the case, the property manager’s role is to ensure appropriate clauses for pets are included.

6. Study the market before setting rent price

Before deciding how much rent to charge, Mr Pressley encourages landlords to understand the current rental market, including the area’s vacancy rates and rental supply.

Here’s where the local expertise of the property manager will certainly come in handy.

7. Be careful when setting lease expiration dates

Be mindful of traditional peak and quiet seasons when setting the expiration of the next lease, Mr Pressley advised.

He said: “Generally speaking, tenants are more active during the months of November through to the end of February. There are plenty of times that I have instructed property managers to offer a nine-month lease as opposed to the usual six or 12 months.”

The goal – and the reason for this – is to “have the next lease renewal fall in peak season”.

8. Pay attention to the rental market outlook

Finally, in order to come up with a smart investment strategy, Mr Pressley advised landlords to consider the future outlook of the rental market, which could ultimately affect the long-term success of a property investment.

He gave the example of improving economic conditions expectations often having a positive influence on migration patterns, and vice versa.

“Equally, an anticipated surge in new supply may cause rents to soften in future months or years,” he conceded.

It’s why he acknowledged that ”ultimately, being surrounded by competent and trustworthy property professionals will come in handy when understanding the market and formulating a strategic approach to investment.”

Vendor satisfaction has risen to an all-time high, sparking new expectations that a significant rise in the number of properties available for sale is set to occur.

RateMyAgent’s latest Price Expectation Report, which surveyed more than 51,500 Australians who sold a home between October and December, showed 51 per cent of sellers achieved the price they were looking for – up from 47 per cent at the same time in 2019.

Preliminary data for the first three months of 2021 shows vendor happiness has risen to 56 per cent, RateMyAgent said, which would be the highest overall satisfaction rate reported in the survey’s history.

Regional areas recorded slightly higher levels of satisfaction than major cities in the final quarter of 2020, at 52 per cent, compared to 50 per cent.

In Victoria’s Mallee region, a whopping 70 per cent of vendors reported they were satisfied with their sales price, an indication of the strong demand for regional properties that occurred throughout 2020.

Victorian locations made up four of the top 10 happiest areas in Australia, with the Mallee joined by Outer East Melbourne, the Central Highlands and Goldfields and Outer North Melbourne.

Hobart was Australia’s second happiest city, with 67 per cent of vendors satisfied, while 66 per cent of sellers in Queensland’s Richmond-Tweed region said they were happy with their sales prices.

On a state-by-state basis, the Australia Capital Territory overtook Tasmania as Australia’s happiest, with 66 per cent of vendors in the ACT reporting satisfaction, compared to 60 per cent in the Apple Isle. 

Conversely, seller satisfaction was lowest in Western Australia at 43 per cent, while 48 per cent of vendors in Queensland were happy with their sales price.

The satisfaction data follows CoreLogic reporting that Australia’s national median house price hit a record of $583,157 in January, with analysts predicting that all time high is likely to continue to rise.

RateMyAgent co-founder Mark Armstrong said the sales prices being achieved would drive a significant lift in the number of properties available for sale in the coming months.

“Looking ahead, we’re forecasting a 10 to 20 per cent increase in the number of properties entering the market for sale in 2021 – particularly in the second half of the year,” Mr Armstrong said.

“Our advice to Australians who are thinking of selling is to sell now. 

“The spring market will see a significant increase in the number of properties on the market and this will soften vendor happiness and prices. 

“For buyers, the second half of the year will see some fantastic opportunities.”

Listings data from Ray White, Australia’s biggest residential auctions house, showed a resurgence of sellers was already under way, with the group’s listings up 11 per cent on the same time last year and 15 per cent higher than the same time in 2018-19.

Mr Armstrong said the catalyst for 2021’s market growth was Australia’s historically-low interest rates, with the RBA recently stating it intended on keeping the official cash rate at 0.1 per cent for at least the next three years.

“In many cases, especially regional areas, it’s cheaper to buy than it is to rent,” Mr Armstrong said.

“In addition to this, buyers are ready – many Australians spent significantly less money in 2020 and shifted their focus to saving for a home loan.

“This low-interest environment, huge amount of supply and high buyer confidence is going to drive colossal growth in commission across the industry.”