Investing in property has long been regarded as a savvy way to build wealth and safeguard your future. Whether you’re getting started or are already three properties in, here’s what you need to know, along with our top ten tips to secure a healthy return.
Just like any boy scout, investors need to be prepared—both before and after they purchase a rental property. “It's good to have at least three to five mortgage repayments in the bank in case something happens,” advises Galldon Rental Department Manager, Anna Jorgensen. For example, hot water systems are expensive to replace and are renowned for breaking down, so it’s always wise to have funds in reserve to cover yourself for any sort of unforeseen circumstances.
Ensure your Property Manager is up-to-date with legalities
There are so many legal requirements attached to investment properties, it can be hard for the everyday investor to keep up-to-date. That’s where having a switched-on property manager is a must, for situations such as knowing maintenance is required to be done within 14 days or if a circumstance like this arises:
“If I have a property which was leased with a ducted heating and cooling system and it broke down, the landlords may think they can replace it with heaters instead. But that is not permitted—it must be repaired or replaced to the same equivalent,” Anna confirms.
Choose the perfect investment property
“It’s all about doing your research,” Anna explains. This means looking at the amenities, such as public transport, parking, schools and proximity to the CBD. She also recommends talking with a property manager before signing on the dotted line, to see what rent they are likely to achieve. It should also be well presented, in excellent working order and offer modern inclusions.
Run your investment at a profit and not a loss
Making sure that property is in good condition is a must and will also ensure you continue to maximise a healthy yield.
“Keep on top of maintenance, and ensure the property is always presented properly,” Anna adds.
“We do recommend a rental property is painted every seven years and also re-carpeted as well.”
Also, it’s important to avoid any lengthy vacancies. “If a property is in good condition and well looked after, it will lease quicker,” she says. One of the ways landlords and property managers can safeguard against this is to foster a healthy relationship with their tenants. Always keep the lines of communication open and wherever possible, encourage a long-term tenancy.
Monitor the market to your advantage
Buying at the right time is always important and knowing when peak rental periods will hit is another advantage.
“Between around the middle of January, up to Easter is when we find it to be the busiest time for leasing properties,” Anna adds. “So obviously there are times in the market where it is ideal for the properties to become available.”
10 top tips to maximise returns from rental investment
1.Find excellent tenants and foster a long-term and solid relationship with them
2.Avoid long periods of vacancy
3.Offer a long term lease option
4.Purchase your investment with a great location, close to shops, public transport, cafes and other necessary amenities
5.Keep on top of all repairs and attend to maintenance promptly
6.Modernise interiors, especially kitchens and bathrooms
7.Install “value add” appliances, such as a dishwasher, air-conditioning and heating
8.Consider being pet-friendly, to attract more potential tenants
9.Have at least one parking space included
10.Price your property strategically and factor in rent increases
Would you like to know more about our rental property services and have your valuable investment in safe hands? Call one of our property experts on 03 9670 3330