What is a tenant favourable market?
Similar to the sales market there are times when the rental market is owner favourable and when it is tenant favourable. At the beginning of the pandemic the market quickly turned to a tenant favourable market. Tenants had the opportunity to take their time and view multiple properties, negotiate rents before making an application to rent. The market then turned to an owner favourable market when home sales escalated which caused a reduction in the number of rental properties in the marketplace. This rapidly increased rental rates and had owners receiving multiple applications for properties after only one showing. Owners had the choice of applicants for their property.
In recent months the market has shifted again to a tenant favourable market. As housing sales have slowed an increase in rental properties has slowed the market. This allows tenants to be more selective when choosing a place to rent. What does this mean to landlords?.
In a tenant favourable market it may take a bit longer to find the right tenant to rent your property. I am often asked how long does it take to find a tenant?. There is no correct answer to this question. Finding a tenant is best described as finding the right match for your property and a potential tenant.
A property may be advertised for a lower price which attracts lots of interested parties, resulting in multiple applicants for the property. The concern is are these applicants suitable for the property?. Alternatively advertising a property at a high price may result in the right applicant not considering your property. It is important to review the current market conditions in your area to determine what the market is renting for at that time. Identifying your properties place in the market compared to other properties for rent and pricing it accordingly will result in the appropriate potential tenants considering the property.
During a tenant favourable market it will take more showings, time and effort to find the right fit for your property. It is important in these conditions to be patient and ensure you perform the necessary due diligence when selecting a tenant. A tenant favourable market allows potential tenants to look at multiple properties before submitting an application. Often we see landlords make the mistake of deciding on a potential tenant based on what they looked like or how they felt about them during the showing. Tenant favourable markets can cause landlords to be desperate to have their property rented instead of vacant and take shortcuts in the tenant selection process. Due diligence is more valuable during a tenant favourable market.
Need assistance managing your rental property, Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com
