In a normal market, the peak rental periods on the Sunshine Coast here in Qld is Dec & Jan when people mainly move into the area. In the marketing boom that went out the window and I was getting as many as 70 applicants per property no matter what time of the year it was.
I wrote a while back about how the rental market had started to cool here on the Sunshine Coast and how some properties we had previously been able to ask $950 pw we had to reduce to $850 pw to secure a tenant. You can read an article I write back in 2022 about this here.
It’s fair to say property investors are confused. Interest rates continue to go up throughout 2023, but rents here on the Sunshine Coast are not. Even though the media is saying there is a rental crisis. So why is that? Could the media be wrong?
I’d said before. There is a rental crisis. For affordable properties under $400 pw. At $600 or $700 pw there is no rental crisis on the Sunshine Coast and has not been for some time now.
As I write I have rental properties open for inspection where no potential tenants show up to view. Not just one open home. I might advertise a property Wed, Thur & Sat and have no potential tenants attend any of these. But it’s worse than that. Potential tenants will contact me and I will explain if they are unable to attend at the advertised open home times I can show them privately. Then crickets. I never hear back from them.
I would say right now we are back to a normal rental market on the Sunshine Coast. With just a few applications per property and little interest. More importantly, the advertised weekly rental price needs to be on point. Also as I type there are around 30 properties for rent in Aura for around $650 pw. Many have been advertised now for over a month. So that’s an oversupply.
Let’s look at some examples of some properties we’ve marketed and leased in 2023 so far.
JULY 2023 – JUST A SMALL SELECTION OF PROPERTIES WE’VE LEASED IN JULY
Kessler Street Baringa | | Leased for $530 | 27 days on the market | 20 applications
This is a really lovely modern 2 bedroom townhome, with 1 bedroom and bath downstairs and one upstairs. Making it ideal for 2 people who want to share. As you can see we had a solid 20 applications. But the reason it took almost a month to lease is we allow people to apply prior to viewing and many people who apply, their applications just are not suitable to be approved.
Gilbert Street, Maroochydore | | Leased for $600 | 40 days on the market | 10 enquiries | 4 applications
Top floor apartment. The main bedroom has an ensuite and the second bedroom has direct access to the bathroom. The balcony is a decent size and looks out onto trees. You’d assume due to the central location we’d be smashed with interest. Nope. Just 10 enquiries, 4 applications and took a staggering 40 days to lease. What’s really sad is this was a break lease and the tenants foolishly assumed we’d secure a new tenant without an issue.
In addition, to be able to show this privately I had it open for inspection 3 times a week including Saturdays and most of these I had no one attend.
Centenary Drive, Maleny | | Leased for $1,000 | 27 days on the market | 5 applications
While the price is high this is a sprawling residence, with a tennis court, lake, pool, & substantial home. Its biggest drawback was the distance to the coast. Most people felt it was just too far away.
JUNE 2023 – JUST A SMALL SELECTION OF PROPERTIES WE’VE LEASED IN JUNE
Poinsettia Avenue, Mooloolaba | | Leased for $830 | 128 days on the market | 14 enquiries
Location, location, location. PLUS 5 bedrooms. People who enquired just could not see the interest. While this is an older home, it’s in very good condition, with 5 bedrooms and several living spaces and an updated kitchen. Then when we finally found and secured a quality tenant unfortunately the owners had to wait 4 weeks until they could move in.
Grigor Street, Moffat Beach | | Leased for $820 | 23 days on the market | 7 applications
Close to the beach, really private setting. Took 3 weeks to lease and just 7 applications. Interest was very low.
Sublime Street, Palmview | | Leased for $750 | 18 days on the market | 10 enquiries | 6 applications
Brand new home. With 3 separate living spaces, a butler’s pantry. While leasing this in under 3 weeks is acceptable. The tenants could not move in for 4 weeks, the owners chose to wait as their tenant’s application was exceptionally good and the other 5 applications just were not suitable at all.
Memorial Ave, Maroochydore | | Leased for $550 | 30 days on the market | 15 applications
1 bedroom modern apartment. 15 applicants is a solid number. Many of these only wanted a 6-month lease, which goes by fast and leaves the owner looking for another tenant fairly soon. But also several viewed and then withdrew or applied and then did not view.
Erbacher Road, Nambour | | 9 days on the market | Leased for $530 | 5 enquiries | 3 applications
This home is really charming. It’s more Woombye than Nambour, on a corner block it really has a wonderful feel. New flooring, fresh coat of paint, updated kitchen. Just 5 enquiries. That’s extremely low. So is just 3 applications.
Sunshine Court, Maroochydore | | Leased for $680 | 18 days on the market | 19 enquiries | 7 applications
Great location, priced really well. Still, took over 2 weeks to lease and 7 applications is not a lot to choose from.
Upper Landershute Rd, Landers Shute | | Leased for $450 | 43 days on the market | 14 applications
This owner initially wanted to try a weekly rental amount that was higher than the market evidence. We explained as the owners the choice is there but we assume interest would be very very low. The initially high prices added to it being on the market longer than usual.
Reilly Rd, Nambour | | Leased for $585 | 25 days on the market | 3 applications
This owner initially asked we advertised at a higher price, which we had no interest in. The price then had to be reduced to meet the market, resulting in just 3 applications.
MAY 2023
Esther St, Nambour | | Leased for $550 | 28 days on the market
This property was priced to meet the market but still took almost a month to secure a quality tenant.
Eudlo School Rd, Eudlo | | Leased for $795 | 14 days on the market | 3 applications
14 days on the market and only 3 applications really indicates how the market on the Sunshine Coast has slowed
Sunny St, Palmview | | Leased for $700 | 34 days on the market | 16 applications
This was a break lease as the tenant bought a home. He assumed we would not have any issues securing a tenant so was a big shock it took us 34 days. Of the 16 applications about 4 were suitable but the dates did not match except for the 1 that was approved and that was only because they agreed to move the lease start date forward so it would all work.
King St, Buderim | | Leased for $600 | 43 days on the market | 3 applications
This owner initially asked that we market the property above market comparables. Once we adjusted the price to be in line with the market, interest was still low as it has already been seen online and dismissed.
Mount Pleasant Rd, Nambour | | Leased for $520 | 16 days on the market
This is a renovated 2-bedroom duplex. It took us 2 weeks to find and approve a suitable tenant. While that time frame is acceptable. If the Sunshine Coast rental market was still booming it would have been leased much faster.
Lime Court, Palmwoods | | Leased for $570 | 6 days on the market | 11 applications
Here’s an example of a home leased in a suitable time frame with a solid number of applications, but also the pricing is fairly affordable.
Cambridge Court, Sippy Downs | | Leased for $800 | 8 days on the market | 2 applications
This was a break lease. When the rental market was booming we would have had over 20 applicants in the first 7 days. But we only got 2
APRIL 2023
Roberts St, Palmwoods | | Leased for $585 | 7 days on the market
This home was leased in a short period of time. The weekly rent is within the more affordable price point for families.
Taronga St, Palmwoods | | Leased for $420 | 8 days on the market
This home was leased in a short period of time. The weekly rent is within the more affordable price point for families.
MARCH 2023
Wrigley St, Maroochydore | | Leased for $775 | 7 days on the market
While this leased quickly we only had 2 applications. Great location.
Komodo Court, Kawana Island | | Leased for $650 | 16 days on the market
This is a well-presented home in a popular central location. It leased within a suitable time frame but in the booming market would have leased in under a week.
FEB 2023
Botanica Dr, Sippy Downs | | Leased for $650 | 9 days on the market
Leased within a suitable time frame but we only had 3 applications.
Potoroo Pl, Burnside | | Leased for $775 | 35 days on the market
This is a lovely home. Interest was very small with only a few applications
Olivia Cres, Nirimba | | Leased for $700 | 17 days on the market
This home has a pool, but very few applications.
JAN 2023
Killarney Cres, Nambour | | Leased for $630 | 34 days on the market
This is a 4 bedroom home, witty 2 bathrooms, double lock up garage. 2 living areas and fairly new carpet. It presents well.
Delilah Lane, Nirimba | | Leased for $600 | 35 days on the market
We had very little interest which is why it took over a month to lease
Keils Mountain Rd, Keils Mountain | | Leased for $625| 14 days on the market
Bush location, with lovely views.
Kingsford Smith Pde, Maroochydore | | Leased for $850 | 14 days on the market
While this leased in a suitable time frame. Just 1 application. This property has been $850 PW for over 12 months now. When we advertised, we looked at comparable properties and could not see any evidence we could advertise for more.
Jacana St, Currimundi | | Leased for $650 | 14 days on the market
We only had 2 applications. So interest was very small
DAYS ON MARKET EXPLAINED
This is from the day we launch it onto the internet to the day we mark it as leased. We only mark it as leased once the approved tenant pays the 2 weeks rent and signs the lease. Usually approved tenants do this within just a few days of an approval.
WHY MIGHT WE HAVE A LOT OF APPLICATIONS BUT STILL TAKE SEVERAL WEEKS FOR AN APPROVAL
I’ve written about this a lot in the past. Lots of tenants still apply for properties where their application is not complete or it’s just not suitable. Some simple examples is someone might apply where they have only worked somewhere for a few months but not supplied where they worked prior. Or they might supply rental references that are from a private landlord, which is not ideal. They might have dogs for a property where dogs just wouldn’t be suitable.
Sometimes an owner might think an application is not ideal so let’s keep looking and if we can’t find anyone else we feel is suitable we will re look at the application.
WHAT DO WE DO TO TRY AND LEASE THE PROPERTY AS QUICKLY AS POSSIBLE?
The first thing is we need the applications to be suitable. It’s common we will get 5 applications and we could not approve any of them.
What we do is this ;
- Allow tenants to apply prior to viewing
- Use great photography, including Virtual Furniture if needed
- Include a colour floor plan
- Include a video
- Hold open homes through the week but also offer private inspections
- Get back to tenant enquiries fast
- Process and follow up all applications fast
As a business, it’s very time consuming to take enquiry, show properties and process applications. So we want to find and secure a tenant as quickly as we can. If we can do all that in 24 hours that’s great for everyone.
SO WHAT’S MY SUMMARY ON ALL THIS?
While landlords want more rent and think they can get it due to the media. The media is wrong. Very wrong. Landlords need to budget for these rate rises as the rent is not going to cover these increases.
Property investing is for the long term. While things are very challenging for everyone right now. I assume they will stay challenging for several years so long term planning is needed.
Lastly, tenants need to get a lot better at completing applications & they can read more about that here.
