‘Incredible’: Grim trend exposes big problem with renting

Hundreds of applications are flowing in for every rental on the market in Sydney – with one agent revealing the grim trend she’s noticed.

Hundreds of applications are flowing in for every rental on the market in Sydney, as unprecedented pressure pushes prices sky-high — and the vast majority of applicants are offering more than the advertised price.

The national vacancy rate is at an all-time low at just 0.9 per cent, forcing staggeringly high prices and fierce competition for every available property.

Though so-called “rent bidding” was outlawed in NSW late last year in a bid to stabilise soaring prices, it has done little to reverse the trend.

In fact, more than 100 people lodge an application for every apartment that’s up for rent in Sydney, according to one listing agent — and 80 per cent of them are offering more than the listed price.

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More than 100 people are applying for every rental property in Sydney. Picture: NCA NewsWire / Jeremy Piper

“When we first came back from our Christmas break in January, that was the busiest time,” agent Scarlett Manttan of McGrath Property told news.com.au at an inspection on Saturday.

“My friend from work in the Coogee office had 106 people at one inspection. It’s crazy.”

Although landlords and agents are no longer permitted to solicit rent bidding, the practice is still allowed if it is tenant-initiated - and Ms Manttan said, in her experience, applicants offer to pay more a staggering 80 per cent of the time.

Other prospective tenants were visiting half a dozen properties each week, filling out “practice applications” and lying about their pets in order to get ahead.

And more than 100 people are applying for every property. Picture: NCA NewsWire / Jeremy Piper

“Whether that’s $5, $50, $100 (more), people see a lot of other people at the inspection and they just put in an application way over the asking price, which is incredible,” Ms Manttan said.

The new restrictions on rent bidding made it harder for those in the dark about the practice to compete, she added.

“We’re not allowed to disclose what they’ve offered,” she explained.

“So obviously an owner, if they want the higher price, they’ll go for the higher price and we can’t disclose that to other applicants, so they don’t get a chance to come up and meet that. That’s why it’s competitive and that’s why a lot of people are missing out.”

Dozens of people lined up in the hot sun to view the listings. Picture: Alice Fahrer

Some said they were filling out “practice applications” to find ways to hack the system. Picture: Alice Fahrer

A look at several rental properties in Sydney’s inner suburbs on Saturday painted a dire picture of a market that is unprecedentedly under-supplied.

At one property visited by news.com.au — a one-bedroom apartment on a busy ambulance and bus thoroughfare, advertised at $680/week — more than 40 people showed at the inspection.

One couple, Adam Stuart and Emily Lau, said they were filling out “practice applications” ahead of an anticipated move next month, as they were nervous they would miss out.

One $680/week one-bedroom had 40 people at the inspection. Picture: realestate.com.au

“We’re just trying to get an idea of the market, what we can afford, and what we have to do to stand out,” Ms Lau said.

“A lot of people are looking, so we’re applying for a lot of places until we feel confident we’ll get the right one.”

The couple said they were considering spending up to $700 per week on a one-bedroom — about one-third of their income — given the “crazy market”, but they were unwilling to splash out more.

“I think it’s irresponsible to spend more than that much of your income on rent,” Mr Stuart said. “And it’s particularly irresponsible if agents are encouraging it.”

Another couple inspecting the 2nd-floor Rosebery property, Elena Khlopova and Kirill Kacherov, said they had visited at least four properties per week since early November, but had no luck.

Couple Elena Khlopova and Kirill Kacherov said they had viewed four properties each week for several months. Picture: Alice Fahrer

Mr Kacherov expressed concern their golden retriever was making it difficult to find a property. Picture: Alice Fahrer

“When we first started, it was okay in terms of price. Well, it wasn’t okay, but it was better compared to now,” Ms Khlopova said.

“So far, we’ve got four or five declines because … I don’t know why, actually. We’re trying to offer a little bit more, because we understand how it works right now.”

“We have a special situation,” Mr Kacherov cut in, explaining that they owned a medium-sized golden retriever.

The couple said they were willing to pay more for an accommodating landlord, but were facing constant rejections regardless.

Ms Khlopova and Mr Kacherov said they were trying to conduct the process above board, even as some renters choose not to disclose their pets on application forms to get ahead.

At a $600/week studio on a busy road, more than a dozen people showed. Picture: realestate.com.au

At a separate property — a studio apartment on the same busy road going for $600/week — more than a dozen hopeful tenants showed up, all of whom left with an application form.

Prospective tenant Will Ranger said he had looked at more than 10 properties in his search, and had been unsuccessful in all of his applications.

“I’ve been looking for a few weeks, maybe even up to a month,” he told news.com.au.

“Everything seems to be going before it even gets to the market. We’ve seen a few properties where there was an asking price, and people aren’t even looking at the property, they’re just throwing money at it.”

Agent Scarlett Manttan said about 80 per cent of applicants offer more than the advertised price. Picture: Alice Fahrer

Mr Ranger said he was reluctant to pay more than asking price, even as tens of people plucked their way through the open house.

“To be honest, prices are ridiculous as it is,” he explained. “Landlords are being extremely greedy. I’m not interested in spending above my means and adding to the problem.”

Another person present, Mahfy Rahman, said he was inspecting the property as a short-term option while he waited to move into a home he had previously purchased.

Mr Rahman said he was looking to spend about 35 per cent of his income renting the unit — but he would offer more if there was heavy competition.

“I’m just looking for something short-term while I’m between places,” he said.

“It’s pretty crazy how many people are turning up to the apartments I’ve looked at.”

In Alexandria, applicants queued for a two-bedroom available for $800/week. Picture: realestate.com.au

At a third property visited by news.com.au — a two-bed, one-bath terrace with only a partial kitchen, advertised at $800/week — a line of prospective tenants snaked down the block as people squeezed through the doorway.

One of them, Luke, said he had been looking for three or four weeks without success.

“We’re offering higher than what they’re asking — about 50-70 bucks higher — and we’re still getting turned down,” Luke said.

“I’ve made about four offers, but I think people are offering literally hundreds more.”

The property’s agent said the market showed no sign of letting up. Picture: realestate.com.au

Almost all properties were successfully rented after just a single inspection, agent Scarlett Manttan said.

The market, she added, was showing no signs of letting up.

“Last year in January, it was pretty busy, but it died down towards the end — like about this time last year,” she said.

“But (this year) it’s still very busy now. I think it will stay this way right until March, early April.”

Have a story about the rental crisis? Get in touch — [e-mail]