Rental Assessments & Determinations
Rental Assessments & Determinations (NCAT, OSBC, ATO)
Quadrants rental valuations and determinations offer a fully independent assessment of the subject property for a range of people and purposes. It may be a tenant or a landlord looking to enter into or renew a lease, superannuation, it may be a rental dispute of market value or a wide range of others. We are fully qualified in residential, commercial reasons, industrial and retail lease matters including SRV, certification for the Office of Small Business Commissioner determining such disputes.
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Market rental values of commercial, Industrial and retail properties are the most under or over/inaccurately assessed sector of the real estate market than any other area, which translates into leases and financial gain or loss for the landlord or the tenant.
This is mainly due long-term use and reliance by people on previously steady yields and cap rates on such properties estimating rents from sale prices or considered market value in favour of comparable properties where they are absent.
In recent years these rates have been more volatile and have fluctuated greatly leading to vastly inaccurate rental assessments on this basis.
For example: In times gone by a rate of say 7% may have been a stalwart/solid and constant with minor adjustments here and there, however with for example significant compression in such rates of 3% in cases, can create vastly inaccurate outcomes.
For example: A property sold for $1,000,000 and @ 7% may indicate a market rental of $70,000pa.
Yet a similar property recently sold and recently leased @ 6% being an actual $60,000pa reflection.
The seemingly small 1% differential translates to an almost 17% inflated rental all things being equal.
Furthermore leases often with fixed rate rises per annum or CPI rate rises being out of line with a changing market can be massively skewed over a 3, 5 and without doubt a 7 or 10 year lease terms.
Often items such very expensive fit-outs and other benefits may be hidden into inflated rents and leases for various reasons, which cause a purchaser to buy above market value, go to release the property and find the rental was inflated and suffer a double loss similar with tenants not knowing past leases have been inflated and walk into inflated leases based on the past at face value.
It is for this reason, it is always beneficial for a landlord or tenant to have an independent rental assessment conducted in the lead up to the termination date or option period to place them in an enlightened position prior to the crucial renewal period.
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