Property’s rental squeeze drives potential tenants to rash decisions

Lies, cash handovers and short-term loans: it may sound like shady business deals but it’s something far more common.

Skyrocketing rents are forcing people to go to extreme measures to secure a tenancy.

A new survey by Finder.com.au suggests tens of thousands of tenants are lying about their incomes, savings or not having pets just to impress a potential landlord.

Almost one in ten have offered more than the asking price, a similar proportion used contacts to put in a good world, and many paid several months’ rent upfront.

The extreme efforts come as rents surge, vacancy rates remain near record lows and the market is tipped to remain tough.

Finder head of consumer research Graham Cooke says “it’s a cutthroat world out there for potential renters – with huge crowds turning up for the best properties”.

“Prospective tenants are offering more than the advertised price – some even going as far as taking out personal loans – in a frenzied contest to impress agents and landlords,” he says.

However, lying on an application could prove costly, Cooke warns.

“Agents tend to find the truth and if you get caught it could end up on your rental record,” he says.

“Most often than not, property managers will look through a tenancy database to find the history of a renter, so lying on your application about former rental history could come back to bite you.”

Getting a foot in the door is the toughest task for tenants right now. Picture: iStock

Cooke says prospective tenants can make themselves appealing by:

• Attending inspections as soon as possible.

• Being proactive in contacting property managers.

• Delivering applications “by 9am on Monday morning” and producing more than the required information.

• Not limiting themselves to just a few suburbs.

SQM Research says rental vacancy rates are 1.4 per cent in Sydney and Canberra, 1.5 per cent in Melbourne, 1.2 per cent in Darwin and below 1 per cent in other capital cities.

The national median asking rent has jumped 17.5 per cent in the past year to $551.57 a week, while capital city rents have climbed further – up 25.1 per cent, it says.

SQM Research managing director Louis Christopher says the market favours landlords and the immediate outlook is for “ongoing extreme tightness”.

“February-March tends to be a very seasonally difficult time for tenants looking for rental properties and given the already low rental stock on the market, early 2023 could be a nightmare for would be tenants,” he says.

“However, there might be some light at the end of a very long tunnel given expected rises in dwelling completions over 2023 and a possible return of short term leased properties back into the long-term market.”

Originally published as Property’s rental squeeze drives potential tenants to rash decisions