There are a thousand too many 2 bedroom, 2 bathroom, fully furnished apartments on the rental market right now. There are many factors that lead to supply exceeding demand, but I’ve seen a major drop in the enquiry from ‘corporate tenants’ – which is when the tenant has their boss, or their company, paying their rent. The company provides an accommodation allowance for the staff member, often as an incentive to take the new position within the company.
With the job market softening a bit, the company HR team find they have enough applicants for the jobs they’re offering and they don’t need to offer these incentives right now to get the right staff.
These fantastic ‘corporate’ tenants are disappearing and enquiry is not coming in from this normally active source. And for some landlords the hopes of this seemingly perfect scenario are unrealistic. The thing is a company can go into administration at any time, or cut short a job contract or a project. A company can walk away, call it liquidation and you can’t stop them. A company won’t pay any more in rent to you, and their staff member won’t take better care of your property and their expectations of the premises are similar to that of a hotel – consumable.
I get enquiry from professional couples and wealthy families moving interstate, changing jobs, selling and buying, waiting for their dream home to be built and I get sisters who’ve lived in their apartment for years and the owners selling and they need a new place, and I get single men who need a special kind of garage for their Porsche! This is what I want in a tenant, not a company lease with a chief technical officer with no name!
These are all excellent tenants who care for their home and treat it as their own. They know you are a person and they respect your property. They often have their own investments and they know what the expectations are.
Tenants in the inner-city want a nice lifestyle and they’re not afraid to pay for it. Corporate’s want a bed, and a fridge, and a cheaper-than-$195-a-night hotel room.
Don’t worry about tenant selection, we’ll get it right. The market is still okay and rent will come in either way!