I have mentioned in my monthly reviews that the last property I purchased has been vacant since the refurbishment project was completed in November. The reason is that the exterior of the building and external common areas are being upgraded. Practically, this means that the air conditioning units have been pulled out and are sitting on newspaper in one of the bedrooms, the windows are taped up and the views and light are largely blocked by scaffolding and green safety netting. I was expecting that the property would be vacant until the project was completed in April or May.
I have been proved wrong. My agent has managed to find a tenant who will move in at the end of the month and will pay a rent level that is slightly above the upper end of my expectations at the time I signed the provisional agreement for sale and purchase in the middle of 2007.
I had to ask myself why they would want the flat when they are faced with at least three months of limited natural light and some other disruption? They have seen the flat and are aware of the timing for the completion of the exterior work (and the possibility of delay). I considered the possibility that they may be setting me up for some kind of squatter scam, but the tenants are an executive at a reputable company and his wife. The lease will be in the name of the company (not the executive). I can only assume it is a combination of a scarcity of good apartments in the Mid-levels area and the very nice/new fit out.
They have not actually signed anything, so I am pushing to get the provisional agreement prepared and signed as quickly as possible - hopefully on Tuesday next week. It would be nice to get back to 100% occupancy again. The cash flow from the portfolio once fully leased will be quite good given the declines in interest rates recently and this will help me build up the deposit for my next purchase more quickly.