Tenants offer more rent to win leases

DEMAND for rental homes in Geelong has become so high that prospective tenants are even offering bids for certain properties.

McGrath, Geelong property manager Donna Cross said investors were coming to Geelong in droves for big returns and keen renters.

“Ultimately it’s the buying price compared to Melbourne. The percentage returns that investors can get can be better than what they get in Melbourne,” she said.

“We have a lot of tenants out and about at the moment so we’re leasing properties quickly.”

Ms Cross believes the recent, and predicted further population growth in Geelong will continue to underpin any investment property.

There has also been a high demand for specific properties, in areas such as Newtown, with potential tenants opting to “bid” on properties similar to Melbourne, Sydney and Canberra, offering higher rents and larger advances.

“Large properties in New- town that are coming up, people are putting in bids, offering this and that so they can get into those,” Ms Cross said.

Inner-city areas are most likely to see the biggest hike in rent thanks to supply and demand and a 2.2 per cent vacancy rate across the region, according to REIV.

“Instead of experiencing price drops like landlords did 18 months ago, they’re maintaining prices or even seeing increases when they go back on the market,” Ms Cross said.

“In older Geelong it will be really good for landlords because the prices will increase — supply and demand.

“But there are still a lot of new properties being built at the moment. Renters will have to move a little further out for good prices.”

ME Bank head of home loans, Patrick Nolan, said investment in regional areas had been trending up, but he still cautioned potential buyers.

“When buying an investment property in a regional area, consider factors that can influence the local market,” he said.

“Towns that have greater economic depth and breadth are more resilient to industry changes. Geelong is a good example, where the loss of some manufacturers had a smaller impact on the local market.”