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Rise Above It

Rise Above It
October 31, 2022 Propertyology Head of Research and REIA Hall of Famer, Simon Pressley

Most people are good people. Most of the 7+ million Australians who live in rental accommodation, along with most of the 2.2 million Australians that have personally funded 91 percent of the nation’s total rental supply are good people.

For more than 200-years, the relationship between landlord and tenant was largely one of mutual respect.

Unfortunately, an ‘Us versus Them’ rift of sorts has infiltrated into society in recent years.

It is an unpleasant dynamic and something which all community members ought to be very mindful of.

Beneath it all is 7-years of poor property policies which have collectively created a rental crisis in every corner of this huge country.

The extreme shortage of rental supply has already pushed up the advertised price to rent a standard house, over the 5-years to 31 July 2022, by $100 per week or more in 81 of Australia’s 100 largest townships.

Sydney ($50 per week) and Melbourne ($70 per week) have seen some the smallest increases in rent prices.

In response to fast-rising rents, some tenants feel it appropriate to hurl abuse at landlords, including accusations of ‘greed’.

Little do those suffering from Tall Poppy syndrome realise that 72 percent of Australia’s 2.2 million property investors earn $100,000 or less.

Or that 107,000 property investors are aged 30 or less.

Yet 39 percent of tenants are aged 45 or older. Surely 25+ years in the workforce is more than enough to get household finances sorted to get the foot on the property ladder.

It goes to show that achievement is more about attitude and application than age or annual salary.

On the flipside of increased rental income are significant increases in expenses that landlords have to cover.

For example, the tax paid each year to local governments (aka ‘city council rates’) along with insurance costs have increased by 20 percent or more over the last 5-years. These costs for a standard house in most parts of Australia are now circa $6,000 per year.

Recent increases in the cost of trade labour and materials also adds to repairs and maintenance.

State government land taxes are up 54 percent from 5-years ago.

And interest expenses on a standard $600,000 investment loan now cost $15,000 more this year than last year.

The point of me mentioning the increase in landlord expenses is not to seek pitty, but to bring a balanced perspective.

To be blunt, through policies by politicians, commentary from some segments of the media and criticism by a small segment of the general public, the treatment of property investors has been deplorable.

A gaol warden treats prisoners better than how Australia now treats those who try to invest in their future. Baseball bats leave bruises, and bruises reduce participation.

Frankly, any individual who sets themselves a goal of avoiding becoming reliant on a taxpayer-funded pension, is prepared to exercise financial discipline to save money, and has been prepared to make an educated financial risk need never apologise for seizing an opportunity to maximise their return.

All that said, it seems appropriate to encourage people to behave like good humans.

Tenants and landlords need each other.

With the assistance of the countless wonderful property managers across Australia, the aim should be a relationship of ‘we’, as opposed to an unsavoury ‘Us versus Them’.


Related article: 6 options for addressing the rental crisis


To the growing number of rental suppliers (landlords) who are feeling beaten and bruised, I want to encourage you to remain focused on why you invested in the first place.

Rise above the poor behaviour of others. Raise the bar. Don’t contribute to the bar being lowered.

Here’s a few recent examples of my own to illustrate how good landlords should behave.


Example #1

My wife and I recently invested in a complete replacement of the kitchen in one of our investment properties. We were conscious of the inconvenience to our tenant during the 2-3 week kitchen installation. As good humans, we organised a $100 grocery voucher from Coles and a short note expressing ‘thank you for your patience.’


Related article: Simon’s latest investment decision


Example #2

Earlier this year, a vandal broke into a property while our tenant was out. Fortunately, they did not take anything of great value. When the incident was brought to our attention, our primary focus was the well-being of the single lady who has rented our property for the last 10+ years. We organised for all locks to be replaced, for flowers to be delivered and enquired if there was anything else that our tenant needed to feel safe.


Example #3

Another elderly tenant has some mobility restrictions. We received feedback that gaps between pavers that lead to the front gate made it difficult for her to bring in the wheely bin and she felt unstable on her feet. A local social worker helped our tenant to put together a proposal to us for some modifications which met her special needs, while not adversely affecting the property’s value and appeal to the broader public. We supported our tenant’s request.

Last, but equally as important, is a general reminder for all landlords to treat their property manager with the utmost respect.

The property manager’s primary responsibility is to protect the asset owner’s best interests, but it can be a thankless task trying to appease the important needs of both parties.

A friendly tone, a ‘thank you’ and the occasional box of chocolates are simple yet effective ways to demonstrate that you’re a good human.

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