The key to success is managing it properly and making it work for you.
Here are ten tips to help protect and grow your investments:
1. Maintain the maintenance
Keeping your asset well maintained makes it a better place to live. No-one wants to live with dripping taps, temperamental appliances or worse! Responding to repair requests promptly not only shows that you care for your tenants and helps to keep a positive relationship, but could also save on costly repairs later on.
2. Know the law
Legislation is in place to protect you and your tenant and is there for a reason. For instance, comprehensive tenancy agreements can help avoid any misunderstanding later down the track and it's imperative your property meets the correct standards for renting.
3. Tenants like to feel safe
As well as living in a safe location, tenants do like to live in a secure property with good locks.
Other safety features, such as security lighting and alarms many not necessarily enable you to up the rental price, but they will certainly give your property the edge over other similar rental properties when tenants are looking for somewhere to live.
4. Insure your asset
Comprehensive landlord insurance from a specialist provider is a must – accidents do happen and you want to be sure you're covered for all eventualities.
Some landlord insurance from non-specialist providers aren't as comprehensive as they claim, so always check the small print.
5. Retain your tenants
A property sat empty isn't making you money, so keep your tenants happy and hang onto the good ones! Make sure you've got good lines of communication and tenants know how they can contact you if they have an issue. Keep rental increases reasonable but also regular to ensure the property stays up with the current market value.
Always respond promptly to tenant requests.
6. Keep the right records
We all hate paperwork but good book keeping by recording outgoings and incomings are a must if you're to keep the tax man happy! Written communications ensure there are no misunderstandings and can be used to clarify any possible disputes.
7. Use a qualified specialist
Whether it's for financial or legal matters or for essential maintenance, always use registered, qualified service providers. A good accountant will know exactly all your tax-deductible benefits for your financial situation, and a good tradie will ensure your asset is well maintained to the correct legal safety standards.
8. Keep your business mindset
Your property is your business. Keep your tenant/landlord relationship professional; be fair but firm. And don't get too complacent when the money is coming in. Regularly review your finances and see if there are ways you can either improve your property to increase rental return, or consider refinancing to increase your property portfolio.
9. Beware of over capitalising
Whilst you want to make sure your property is in pristine condition, and that renovations are done to a high standard, make sure you do your sums, as any improvement you make must make you money. That granite benchtop in the kitchen which cost an arm and a leg may look fabulous, but if it's not going to increase the value of the property by at least the same value of the benchtop and its installation, or enable you to significantly increase the rent, it might be worth looking at a less expensive alternative.
10. Employ an expert property manager
From notifying when your landlord insurance is due and finding excellent tenants, to managing your maintenance, negotiating tenancies, and ensuring your property is legal and safe, a good property management company does all of the above and much much more! What's more, as well as dealing with the hassle and freeing up your time, management fees paid to an agent are usually tax-deductible, so it's a win/win situation.