The Return of the Landlord Market

By March 29, 2017 News 3 Comments

The evidence is in and it is clear that the landlord market has returned.

According to statistics gathered through extensive research, the average rent across Australia has risen by around 20 percent, and this upwards trend is set only to continue unless managed expertly.

Don’t believe us? As a case in point, let us tell you about one of our clients here at CR Commercial Property Group. The client has 242 properties consisting of over 170,000 square metres, mostly in A and B grade buildings. Over the past 18 months, they have reported seeing their average rents increase by about 4 percent.

This is nothing like we’ve seen in years, and the rate at which rents are moving upwards is only likely to grow more rapidly. This is especially the case in Sydney and Melbourne, where already sky-high rents climb higher and higher as the markets become more competitive.

The flow-on effect of this is that landlords, seeing success on this scale and an even brighter future laying ahead, increasingly start adopting a ‘take it or leave it’ attitude. As a result, ‘gazumping’ becomes more widespread.

But despite all this talk of doom and gloom, don’t despair just yet. Follow our advice to make sure that you remain one step ahead in the game and always get a deal that is fair for you.

How to stop rising rent from breaking the bank

  • Think ahead. Don’t leave it to the last minute — if your lease is coming up soon, make sure that you start evaluating your needs in advance so you have time to plan your next move, and give yourself sufficient time to do your homework.
  • Talk with your tenant representative. A professional tenant representative will negotiate with your landlord to ensure that you are sheltered from the worst of the rise in rents. Landlords still make the majority of their profit from lease renewals, and the last thing they want is for loyal tenants to leave and for properties to sit unoccupied for long periods of time — thus losing them money.

By working with a real estate advisor, you are putting your landlord on notice that they must ‘compete’ for your business. The most desirable outcome is a win-win outcome, and a commercial custodial real estate advisor can help you achieve the outcome for you. And at CR Commercial Property Group, we work hard to ensure that our clients always receive an outcome that is fair and ethical.

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