You should never underestimate the importance of carrying out annual rent reviews to maintain the value of your property. Not only do rent reviews keep your income at the current market value but they also ensure your property achieves the maximum potential price, should you wish to sell. Find out why in this 2 minute read.
We recently sold two identical apartments in Waterford City, both were located in the same building. Apartment A sold for €145,000 and Apartment B sold for €80,000
Apartment A was subject to annual rent reviews. In turn the rental value of the property was €900 per month (€10,800 per annum) when it went to market.
Apartment B was another story, the owner had not carried out any rent reviews and a historic rent of €500 per month (€6000 per annum) had remained in place during the most recent tenancy. As a result, buyers did not see value in purchasing it.
Some landlords fall into the trap of not carrying out an annual rent review. I can see how this can happen, some fear that they will rock the boat and the tenant may leave. Landlords tend to be busy people and at times they just forget and let the current rent run its course. However, you can see from the sale of Apartment B, this cost that owner €65,000. Can any of us afford to give away €65,000?
It is essential to carry out rent reviews and ensure you apply market value rent. If your property is in the rent pressure zone (RPZ) apply the correct percentage increase each year, if market conditions support the increase.
ITS IMPORTANT YOU ENGAGE AN ESTATE AGENT WITH EXPERIENCE AND PROCESSES IN PLACE TO ENSURE THEY GET YOUR REVIEW DONE CORRECTLY AND ON TIME!
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Thanks for reading,
Maria Clifford – MIPAV TRV MMCEPI
Cormac Finlay on Monday, March 1, 2021 in auctioneers, blog, county waterford, current market value, Dungarvan, Landlord, property advice, Property Management, Property News and Advice, property rental, renting, staging your home, tenant