Education Centre

Tendering Success

 Tendering Success

Last week we reported our agency would trial tenants tendering for the first few days a property is listed for rent (click here for previous blog entry).  We said that after an initial period of tender, and if the property isn't leased, the home would be listed to the general market with a fixed price. 

Since our announcement we have received significant feedback, most of which was positive.  Our new system gained media attention and we had an interview with the industry magazine the Property Management Journal about our fresh approach. 

In the first week of the trial there was some significant success.  Tenants have been relieved they are able to take control of the rental process and submit offers accommodating their budget. 

Landlords have been happy with the new rents being achieved and the high quality of applications being submitted. 

 Rental Crisis

Not every one is happy with tenant tendering.  Fresh ideas or a new approach can sometimes be threatening. This week we had dialogue with the Minister for Housing's office and Tenant's Union has commented on the process. 

The current rental shortage has resulted in prices increasing significantly.  Detractors of our innovative system say those on lower incomes need protection from predatory practises including rental bidding wars. 

The detractors are exactly right; we won't ever ask tenants to bid for rent.  They tender for an amount they can afford (in effect they always have). 

Unfortunately low income earners have always found it difficult to lease property.  Increasing rents is an economic reality, and have been since landlords started leasing their properties. 

Low income earners could once rely on the state to assist in providing public housing.  This is no longer the case with waiting lists in this area increasing from 3 weeks 5 years ago to 7 years today. 

The Federal and State government blame each other for the lack of low income housing.  The State say the Commonwealth have striped money from building programs and the Prime Minister says the crisis is a result of the States not releasing enough land for development. 

It's not our place to lay blame for the rental price increases or the lack of public housing for low income earners.  As a responsible agent I can only follow the provisions of the Property Agents and Motor Dealers Act 2006 which clearly states that as an agent I must do everything in my power to achieve the best outcome for my client (landlord). 

The legal obligation to look after clients is not to overshadow the moral obligation agents have to be fair to customers (tenants).  As such agents (through peek groups such as the REIQ) must put pressure on government to address the housing crisis immediately.  We must also work with various community groups in our area to help those customers who are at risk (eg having difficulty paying rent or are having difficulty finding a home). 

Our agency is working with community groups to help battlers who are at risk and assist tenants in meeting their obligations in paying rent.  Business is not always about taking, it's often more rewarding when you give back as much as you take. 

Agents are, by and large, maintaining their obligations, however the provision of housing to battlers and low income earners was always the purvey of State and Federal governments.  When the crisis hits and rents increase politicians need not find scape-goats in landlords and their agents, they need only review their own policies.