Managing your rental property efficiently is not just a handy time-saver, it can also maximise investment returns. Here are six tips to make things easier.
Time is money, as the old saying goes, and when it comes to investment properties, astute investors will want to make sure none of their cash is being wasted.
Because being savvy with your property investments means more money in your hip pocket – and with the national vacancy rate sitting at just 1.07%, property investment has never been a more lucrative way to secure your financial future.
Here’s some actionable advice to enhance your investments, streamline your property management processes, reduce stress, effort, and increase cost-efficiency.
While it can be tempting to try to self-manage your investment property, sometimes it’s better to stick to your lane and let an expert take over.
Sure, the DIY approach may save some money, but it can quickly cost a lot in time and effort.
Engaging someone who understands your local rental market, can manage your tenants, stay on top of maintenance needs, and respond to urgent issues when necessary, can be well worth the investment in the long run.
When looking for a property manager, it’s a good idea to shop around, compare fees and services, and look for competitive rates without compromising on quality service.
Once you have a property manager you’re happy with, you want to develop a good rapport and stay in regular touch so you always know what’s happening with your property – without being on the phone for hours at a time.
Victorian regulations require rental providers to conduct gas and electrical safety checks every two years, and an annual smoke alarm check.
But keeping track of which safety checks are due and when can be tricky – especially if you’re managing a large portfolio.
An easy and cost-effective way to ensure your property is always up to standard is using a safety compliance service such as CheckHero.
Using the platform, you can easily view the safety compliance health of your portfolio, and when something is due for a check, instruct CheckHero to reach out to the tenants.
Even better, Checkhero is integrated with all leading CRMs, including PropertyTree and Property Me – making it even easier to start using the platform.
“We send the tenant a calendar link with the dates and times the tradies are available,” CheckHero co-founder Dennis Jap says.
“The tenant can then book in the time they want – it’s all organised directly with them.”
“Once the check is complete, we issue a certified compliance report.”
Dennis says jobs can be booked en masse, or property managers can create settings that automatically book jobs as they become due.
“It’s effectively on autopilot for them,” he says.
“Using our technology is the most time-effective and cost-efficient way to get compliance checks done,” Dennis adds.
3. Claim all expensesThis one seems obvious, but it’s important to keep track of all expenses related to your investments – especially loans used to purchase the property, as well as those maintenance costs we mentioned earlier.
Along with keeping your receipts, investors need to know that the government allows landlords to claim tax deductions for the interest charged on these types of loans.
You can also claim any loan application or mortgage broker fees.
All of those plays a part in reducing your tax bill, helping you save money and maximise your profits – and remember, using accounting software, or getting a professional to help track expenses and deductions will again make your life a whole lot easier in the long run.
Negative gearing in a property is a tax outcome by the way of an investment costing you more than you’re making.
For example, if the expenses of your investment come to $30,000 for the year, but you only made $20,000 in rental income, you can use the difference against your taxable income.
This would mean your taxable income is reduced by $10,000.
And while negative gearing is a tax outcome, and shouldn’t necessarily be a strategy, making sure you’re aware of these deductions can put dollars back in your pocket at the end of the financial year.
Getting a financial advisor who can offer personalised advice for your individual circumstances, property portfolio, and long-term goals is crucial in this step, as they’ll be able to help you get the most out of your money, and your investments.
5. Create a maintenance fundEssentially a pool of money set aside for any works that may crop up on your property, most Australian states require strata unit owners to contribute to some sort of maintenance fund.
However, even if your property is not strata managed, creating a maintenance fund to cover plumbing, electrical work, and replacing appliances as needed removes the stress and hassle of coming up with a chunk of money if these expenses occur.
Choose how much you want to contribute to your fund each month, allow for it in your budget, and transfer it so you can gradually save for the upcoming cost.
Choosing how much you want to contribute doesn’t need to be challenging, either – just have a look at the property size, age, and condition, as this will give you a great indication of the funds needed.
Accidents and the unforeseen do happen, so knowing you’re not going to be left high and dry when it does helps provide peace of mind.
While your maintenance fund can cover maintenance or appliance jobs that might pop up on your property, landlord insurance means you’re covered in the event of property damage, public liability or tenants not being able to pay rent.
Cost of landlord insurance can depend on the size or your property, its location and building type, as well as the type of coverage you want and the excess you select.
Make sure you read the fine print, because some insurance policies may have specific requirements or clauses related to maintenance and safety inspections, including electrical checks.
Ensuring these requirements are met is essential for maintaining coverage and could be necessary to avoid disputes in the event of a claim, which is where Checkhero comes in handy by making compliance checks easy and hassle free for both landlords and tenants.
So with all of this in mind, being a property investor doesn’t mean spending hours managing your portfolio, because with streamlined processes like Checkhero, those pesky little tasks are made easy.
The notion of a family friendly suburb is inherently subjective, encompassing a wide array of factors that can vary in importance from one family to another. Traditionally, these factors have included safety, the prevalence of parks and schools, access to family-oriented amenities, community events, proximity to healthcare facilities, low crime … Read more
Advantages Houses have greater potential to grow in value Can accommodate any type of buyer such as families or singles. Often located in suburban areas Larger internal and external living spaces Can have lots of scope to improve the value and appeal of the property through renovations, additions and landscaping … Read more