We tried to protect our tenants

HOUSING SHORTAGE

THERE has been a lot of comment about the difficulty of finding suitable accommodation at a reasonable price. As homeowners for over 40 years my wife and I have been insulated from such problems, but they have been brought home to us. When we sold our business in 2003 we looked for an investment that would provide income to support us in retirement and bought a block of units. They were exHousing Department and basic one-bedroom but adequate. We soon found the income was quite sufficient so didn’t bother to raise the rent much although over the years it did go up by just under 30 per cent.

Last year we decided to simplify our lives by selling, but were concerned to try to protect our pensioner tenants from the chill winds of change and had them signed up to 12-month leases at their rent of $140/ week. The agent told us the State Government had a program to augment the rent. We sold at a price that showed 6 per cent gross return for the new owners who told our agent they would be happy with the existing rent plus subsidy.

I know there are expenses to come out of that but that still leaves a return better than any bank is paying while the prospect of capital gain (we doubled our money in 16 years) is icing on the cake. Imagine my surprise to have a call from a tenant in some distress to tell me that at expiry of the lease their rent will be $220! I wouldn’t have been surprised at a moderate increase but nearly 60 per cent is, I think, over the odds and I don’t think any of the tenants will be able to afford that. No wonder there are so many homeless people.

Peter Hepburn Claremont