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Renting a Property

Choosing an investment property

Buying an investment property can be an excellent way to create wealth. But, like any investment, doing your research before you take the plunge could save you thousands. There are certain indications that a suburb may increase value:

Check the area for the following:

  • Does demand, for whatever reason, exceed or apparently exceed supply?
  • Is the area’s increase in price significantly greater than the region as a whole?
  • Does the area have low prices, which are expected to rise in the near future?
  • Are neighbouring areas experiencing good capital growth?
  • Are neighbouring areas experiencing good capital growth?
  • Are there positive developments happening in the area (e.g. a new railway or arterial road to the city that will impact positively on capital gains?)

The benefits of property management

One thing that owners of investment property want to avoid like the plague is runaway tenants. There are a wide range of reasons why people might decide to simply up and leave their rental property, but the results for landlords can be devastating. Weeks of missed rent can mean getting behind on your mortgage repayments, while the property could also have been left in a general state of disrepair – which means more money being spent to get it back into a marketable shape.

This highlights the importance of finding the right tenants from the get go. However, if you’re a newcomer to investment property ownership, the interview process can be a daunting experience to undertake. Everything from the way you market your home through to the questions you ask is going to play a role in the process, making it an all-encompassing procedure that requires delicacy and your fullest attention.

However, there is one option to consider that could make the tenant selection process – and overall running of your investment portfolio – much easier in the long run. Hiring the services of a professional property manager could be a great way to get the most out of your investments and help secure a great return.

What is a property manager?

The role of a property manager is fairly straightforward. Basically, they assume full landlord responsibilities for your investment properties and make sure they run as smoothly as possible. This means taking care of everything from maintenance and upkeep through to selecting the right tenants, ensuring they pay their rent on time, and taking care of any problems that arise as promptly as possible.

With a lot of experience in the real estate market, property managers are often extremely knowledgeable about the ins and outs of what makes a great rental property. Therefore, they can be a great to help you earn a good return on your portfolio – alleviating any stress of concerns you may have about being a landlord yourself.

How can a property manager aid your investment?

Having worked in the industry, property managers will have a grasp on the types of people to screen for tenancy, the right questions to ask, and the most suitable references to ask for and verify. Putting your portfolio in their capable hands is a good way to squeeze the most out of your portfolio.

Having seen countless of applications throughout their career, a property manager can easily screen potential tenants and create a shortlist of the most suitable people for your home. Removing the stress and reducing the chances of choosing a bad match for your investment real estate can help save you money in the long term as well. The fall out from a mismatched tenant can be expensive and time-consuming, so avoiding it all together is advisable.

There are a number of other benefits to enlisting the services of a property manager. After working in a community for a period of time, it’s not uncommon for property managers to build relationships with local business and tradespeople.

This can be a huge bonus when it comes to property maintenance and repairs, as they can use their connections to potentially secure deals for materials and services, helping you save money while keeping your investment properties in tip top shape.

Furthermore, a property manager comes with an intimate knowledge of the laws surrounding tenancy and being a landlord. This means you can rest assured knowing your portfolio will be managed within the confines of the law, and that both you and your tenants will be operating within your legal rights.

Keeping organised with your investment

  • Inspections: Routine inspections should be regularly carried out on rented properties to ensure that the tenant is caring for the property and also to ensure that the property is well maintained and safe for the tenant to live in.
  • Maintenance: It is important that you engage tradespeople that are adequately insured and licensed to minimise your liability should a tenant injure themselves from faulty workmanship.
  • Keeping Records: Be sure to keep your investment property records (rental income statements and invoices) in a safe location. These will be required for taxation purposes.
  • Communicate: Keep the lines of communication with the real estate agent open at all times. Honest, open communication is the best way to maintain a happy and professional ongoing relationship.

Risk management

  • Landlord Insurance: Landlord protection insurance will provide you with peace of mind and ensure that you are protected in that unexpected situation for loss of rental income or property damage. Landlord insurance is a tax deduction. When choosing a landlord insurance policy, it is important to carefully read the terms and conditions.
  • Safety Switches and Smoke Detectors: Help save lives! Does your property have an electrical safety switch and smoke detectors? For a minimal fee you can have peace of mind that you are providing a safe environment for your tenants. When installing a safety switch ensure that you engage a licensed electrical contractor.
  • White Ants: They are small – but can cause big problems. It is recommended that you have an annual pest inspection carried out on your property by a professional. For a minimal annual fee, you will have peace of mind that your property is protected and safe.
  • Building Inspection: It is recommended that you engage a professional building inspector once a year to conduct a thorough inspection of the property to detect any potential building defects.
  • Engage Qualified Tradespeople: When carrying out maintenance at a property it is important to utilise a qualified tradesperson who is licensed to carry out the work and who has adequate insurance to protect you against poor workmanship in the event of a tenant injury from the work carried out.
  • Professional Pool Report: If you have a pool at your property it is recommended that you have at least one professional pool report carried out once a year from a reputable pool maintenance company to ensure that the equipment is in good condition and not corroding and to ensure that the pool surroundings, including the fencing complies with local council laws.
  • Promptly attend to maintenance: By promptly attending to maintenance you are reducing the risk of possible tenant injury and avoiding a small repair becoming a large costly one.
  • Budgeting to upgrade & improve a rental property: Over a period of time rental properties need to be upgraded. Taking the time to prepare a budget on your investment property will help you estimate the annual income against expenditure. You will also be able to put aside a set amount to save for maintenance and property improvements.

How to identify a low-maintenance rental property

One of the key features any investor looks for before buying property is how low maintenance it is going to be. After all, unless you have plenty of spare time to be managing repairs and dealing with tenant complaints, this is generally the easiest way forward.

Whenever you’re viewing potential rentals in Surfers Paradise, there are some key feature you’ll need to keep an eye out for. These will help you decide whether it’s the right property for you, or if it’s likely to start costing you money in the long run.

Outdoor space

Does the property come with a lot of outdoor space? Gardens, swimming pools and other features can all take their toll on your maintenance budget, so if you’re in search of something that needs very little input, then perhaps consider an apartment or something similar.

Gardens can easily start to look messy over time, especially if your tenants aren’t particularly green-fingered. However, it might be a major selling point to families, so think carefully about who your target market is going to be.

Flooring types

The type of flooring throughout the property could also give an indication of how easy it will be to keep in top condition. Tiles are generally hard wearing and resilient to wear and tear, whereas linoleum will soon start to look rough around the edges.

This can often be said for carpets. If they seem like they might need replacing in the near future, then this might be something you want to do before your tenants move in. It’s unlikely they will want to go through the hassle of having their flooring replaced shortly after moving in, so taking the initiative early on could be crucial.

Preventative maintenance

When you inspect your rental property, there’s every chance there could be some repairs that need to be made. With any luck, these will only be cosmetic – but there might be other times when some more serious intervention is needed.

If there’s a risk that fixtures and fittings might start to perform less than impressively, then make sure you deal with them before your tenants arrive. In the event you do notice anything more major, ask yourself whether it’s worth the upfront investment. If it isn’t, then this Surfers Paradise rental may not be the best choice for you.

Enlist a trustworthy real estate agent

One of the easiest ways to make sure all your criteria is met when choosing Surfers Paradise property is to have a real estate agent on your side. If you specify that you want a low maintenance rental, then they’ll do everything possible to make sure this happens.

Their vast expertise also makes them perfectly placed for dealing with any questions you might have. If you’re serious about making a success of your investment, then it’s worthwhile having a list of queries you’d like to be answered before going ahead with the purchase.

Speak to the team at Ray White Surfers Paradise to make sure your investment ambitions get off on the right foot the first time.

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