If you have been following up with Singapore’s property markets over the past year, there has been mainly one specific trend: recovery.
Singapore’s recovery across the various markets, and particularly the office and residential markets has been phenomenal. Notwithstanding that, the retail market is still in a slump, although this presents an excellent opportunity for tenants to jump in due to the low rents.
All-in-all, this is a great opportunity should you be looking for rental opportunities throughout the sectors. However, how do you spot an excellent rental opportunity? Well, the answer is simple: landlords.
It is all about reading the landlords’ behaviour.
Have you taken a look around your neighbourhood? Did you notice ‘For Rent’ pamphlets and signs around your neighbourhood (at void decks, lifts, walls, etc)? What about newspapers, magazines, social media, the internet? As you can see, indeed, there are plenty of them. Well, what does this smell like?
It’s an opportunity. Clearly, the first step to understand here is that they need prospective tenants like you. They need you, thus, the need to advertise their vacant slots.
Indeed, there are instances where a tenant can actually turn the tables totally on the potential landlord. That is what is happening right now; it is the tenant’s market – meaning the situation is skewing in favour for tenants. This is mainly due to the simple concept of demand and supply.
When the supply of rental space exceeds the demand for vacancies, this is the time where tenants get should be aware of the potential chances they can capitalise on. At this point of time, a number of landlords would be desperate as they combat oversupply and competition.\
As such, to simplify things, here are a few ways you can spot a landlord that’s desperate to acquire you as a tenant:
Landlords call you because they want you
The general consensus right now is the fact that tenant-landlord relationships are a 2-way affair.
However, in reality, landlords are usually more passive when marketing their vacancies. This is due to the fact that people are always in need for spaces to work, to live, to rent.
As such, they (the tenants) will actively seek available rental spaces for their own businesses. As such, if it is indeed the other way round, there is a tendency that the tables have turned.
Landlords are willing to lower the rent for you (and reduce their profits)
Now, this happens during the contact with the potential landlord.
Clearly, at this stage, you have seen what the rent is going to be and you find that the asking price is affordable. However, as mentioned earlier, you sense that the ball is in your court now; there is room for negotiating for lower rental rates.
Ask questions, show your genuine interest in the place. Landlords know when they have someone who is going to take good care of their apartment and thus they don’t want to lose them. As such, if this happens, what they may do is start lowering the rent for them. This is one way to know that indeed, you’re desired as a tenant.
They give you incentives
Another definite clear sign is the presence of incentives. If you find that a landlord is willing to throw in some incentives to have you secure and sign the lease, well it is a win-win situation for both of you, and even more for you.
Such incentives include offering free internet, free and good parking spaces, even free rent for a certain set of period.
These are landlords who know that they have to offer some incentives to secure a tenant not just because they need the income, but because they also have to compete with rival landlords. As such, the aforesaid situation is a clear sign that the owner knows the market as well as the competition.
Now, this is what is commonly called ‘a tenants’ market’. However, if you really have no need for the extra stuff that is being offered, you may also wish to negotiate for even lower rents due to not needing the incentives offered.
See more: The ups and downs of the rental market
On that note, these are some of the ways in reading landlords’ behaviour to spot excellent rental opportunities. However, keep in mind that real estate is a cycle.
This situation may happen now, but there is also a tendency for a ‘landlords’ market’; where landlords have the upper hand in negotiations. Nevertheless, for both parties, mutual respect is required in order to ensure an excellent business, personal and profitable rapport.
This article was first published in Redbrick Mortgage Advisory.