New investors often struggle after handover: finding and filtering tenants, setting rent and managing turnovers, while the instalment keeps coming every month and the unit sits empty.
What should a new owner decide before letting out a unit?
“there's no such thing as passive income”
Settle four things: the tenancy length, the rent the market will bear, how much to furnish, and who will market and manage the unit. Spend a little to stand out, because a new project hands over hundreds of units at once, all chasing the same tenants.
Why
Short or long stays
Short stays usually earn more, but checking guests in and out and cleaning between them is like running a hotel. Long tenancies can be set as 2+1, two years at a fixed rent with an option for one more.
The market sets the rent
Find out what similar units actually rent for from agents and the property portals before deciding what to ask.
Furnish to stand out
Letting a bare unit cheaply or furnishing well both have a cost. The aim is the minimum spend that makes tenants consider your unit first.
Someone has to manage it
Between tenants, someone must clean, inspect and check that utility bills are paid. Agents handle long lets; short-stay operators can run a unit for a share of the profit.
What to do
- Decide on short stays or a long tenancy, and the length, such as 2+1.
- Check the going rent for similar units before you list.
- Furnish just enough to rank among the first units tenants consider.
- Choose who lists and manages the unit: yourself, an agent or an operator.
- Arrange cleaning and a utilities check for each change of tenant.
Editorial Note: Summarised from Sean Tan's full episode. The quoted answer is in his own words; the rest is our paraphrase. Figures reflect the recording date, so check current rates and rules before acting on them.
4 Things to Know to Let Out Your Unit | Vlog 006
Sources & Verification Data
Summarised from Sean's English captions for this January 2018 vlog, his first sponsored video, made with a company that lets units to corporate clients and filmed in one of its units. The quoted line is verbatim; everything else is paraphrased.
