Dear Azizi Ali,
I'm a new property investor from Johor Bahru and currently holding several units of apartment with the purpose of generating extra cash flow. However, I’m facing some problems in renting them out. I'm confident with the interior as well as the location of the properties which are well situated near to Singapore as well as Pasir Gudang industrial zones where most professional and expatriates are working. The rental in these area are approximately RM1,300 to RM1,800 for a fully furnished RM150,000 apartment. Would like to seek your advice on:
1) Reasonable time frame before an apartment is can be rented out after completing the renovation or repair? (Installment is not in commencement yet)
2) If I’m not able to rent it out, when should I consider selling them off or should I continue holding on to them with hopes for capital appreciation?
3) In property investment, should I give in by reducing the asking rental as per suggested by the agent or should I stand firm with my rental expectation/ yield?
4) What are the steps an investor should take to increase the chance, as well as, the speed for his properties to be rented out?
Hmm, it looks like that you have already jumped into the fire! Welcome to the world of property investment!
Firstly, the way you framed your questions suggest that you are anticipating a problem of letting out the properties. I must state that I can only give you the short answer due to space constraints. (The actual in-depth answer will take a lot more pages.)
First answer: There is no standard time-frame before an apartment can be rented out. The ideal time is immediately after you decided to let! But I suppose one or two months is a reasonable time frame.
Actually, the rental for your apartment will be about the same with similar sized apartments in the same area. It will be difficult for you to charge a higher rent, as only a fool would pay a higher rent when he can get a cheaper rent next door.
So, this means that if you want to let it out as soon as possible, you must reduce the rent. Drop it slightly below the market rate or what other owners are asking. Often, this is enough to sway the tenant to choose your unit instead of others.
As for the things you can do to increase the chances of renting out the properties will include ensuring that the property is in excellent condition and asking for a reasonable rent.
Next point; if the property remains empty for over six months (even after dropping the rental), then it is likely that the location is not ideal. If this is the case, then you should seriously consider selling it off. If you decide to do so, make a serious effort to sell the property. This will probably include dropping the price. An empty property is a drag on your finances, even if you have holding power. Ideally, you should not have even arrived at this situation. Had you done proper homework, you would have probably decided against making this purchase.
Finally, and the most important point of all, is to choose your tenants very, very carefully. Do not rent out to the first person that is willing to pay your asking rent. Make sure that they have a regular job and can afford to pay the rent – among other things. In fact, if you cannot get the ‘right’ tenant, let your property remain empty. It is better to have an empty property than to have a problematic tenant – you have fewer problems that way!
I wish you the best in your new adventure as a landlord, Yi.
Allah is always by your side, Insha Allah, Insha Allah, Insha Allah
Judul: Q&A: When would be the best time to rent out my properties?
Ditulis Oleh farid idris
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