Rental market is snapping back despite landlord caution

Prospective tenants line up to inspect a house in Sandringham Street, Sans Souci.
Prospective tenants line up to inspect a house in Sandringham Street, Sans Souci.

The Sutherland Shire and St George rental markets are recovering from COVID-19 lows, but landlords are still cautious of tenants' financial stability.

Sutherland Shire currently has 579 properties available for lease, a decrease of 14 per cent from April, showing an uplift in tenants renting available properties.

Highland Property Group CEO David Highland said during the most extreme point of COVID-19, his agents saw a 54 per cent drop of tenant inspections from March to April.

During the time group open for inspections were banned and tenants could only inspect a rental property via personal appointment Mr Highland's group went from 804 inspections to 371.

A search of https://www.realestateview.com.au shows average rent prices have remained steady, indicating rental prices have not been negatively impacted during COVID-19.

Mr Highland said Highland Property rental properties are experiencing an average of 14 days on the market before being leased, with some properties still snapped up within the first week.

"Movements of residential tenancies have been based around downsizing in line with the effects of income variations and or unstable employment," he said.

"We have also seen some tenants who have not been affected by their income or job security take advantage of the less competitive environment in the rental market and upgrade during COVID-19.

"Landlords are still very cautious of the COVID-19 impacts with financial stability of tenants and as such are reviewing their rental prices to have a good selection of tenancy applications with those having good job security as a first preference."

Gerry Filas, property manager for Stone Real Estate at Sans Souci, says there are plenty of people looking for rental properties, but a shortage of stock, particularly houses.

An open house inspection he conducted in Sandringham Street, Sans Souci, last Saturday resulted in a 100-metre long line of potential tenants.

On offer was "a three-bedroom house with two modern bathrooms, a renovated kitchen, double garage and ducted air conditioning".

"This was the first inspection and we had 65-70 people or about 17 separate parties through," he said.

"I took some applications for around the $650 a week mark, but we were looking for closer to $700, so we are showing it again on Saturday (May 23 at 1.15pm to 1.30pm).

"What I am finding at the moment is there are a lot of apartments for lease, but a shortfall of houses, villas and townhouses across the St George area."

Mr Filas thinks there are two reasons for the shortage of stock.

"Firstly, because of COVID, a lot of tenants have lost their job, or their income has dropped, so they are staying put, or landlords have reduced the rent for 3-5 months, so there is no point in moving.

"Secondly, I am finding that people are tending to rent rather than buy because the banks are tightening up with their lending."

Mr Filas said a lot of tenants were trying to get out of apartments into a house, villa or townhouse.

"People want a backyard or a courtyard," he said

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