Location along with a quality investment sets the foundations for success when you’re a landlord. Not only will this help your property lease faster than less desirable properties, but the capital growth can also make for a nice nest egg in the future. In the meantime, what is that you can do to make more money from your investment property? Below, we outline three tips on what you can do to maximise the money you make.
- Review rental prices regularly
Rental prices aren’t static. Rents should always be reviewed prior to any new lease commencing to ensure that you are achieving optimum market rent. Your property manager should be completing a full rental market analysis to provide you with guidance for market rents. Of course, the key here is being mindful of the market and not increasing the price so much that you end up with a long vacancy period.
To make sure the rent you charge hits the balance between being competitive in the market and helping you derive the most value from your property, research what similar properties in the same suburb are achieving. This exercise will you an idea of what’s good value in your area and whether you are over or undercharging. If you’re considering increasing the rent when you offer a tenant the opportunity to renew their lease, make sure you give you give the required notice under the legislation. Your property manager will assist you with this to make sure everyone is happy, and everything is above board.
- Keep your property fresh and updated
Refreshing your investment property doesn’t need to be expensive. Simple updates such as tidying up the lawns and gardens or a fresh coat of paint can help make a positive first impression on quality tenants. If other items such as appliances are starting to see better days, consider updating these too. While it’s an upfront investment to update appliances, it can help you attract better quality tenants, and it’s a tax deduction too. To minimise the time that you’re out of pocket for things such as spending on new appliances, consider making these purchases at the end of the financial year.
If you’re interested in tackling a larger update to your property, you could look at renovating to create an extra bedroom or study area. Additional bedrooms can be a great way to open your property to a wider tenant pool. Similarly, creating dedicated spaces for at-home work and study is a smart way to attract tenants who work from home.
- Be prepared for tax time year-round
You can maximise the value of spending on your property at tax time by keeping thorough records of expenses year-round. These records might include a depreciation schedule, documenting your interest expenses, invoices and receipts for all costs incurred for capital works, and receipts for deductions.
Owning an investment property is a great way to build wealth and generate cash flow. By being mindful of what you’re charging for rent, keeping your property fresh and updated, and maintaining detailed records, you can maximise the money you make from your property. If you’re looking for ways to make more money from your property, talk to your property manager to see if any of the options above are suitable for your situation and if they have any other ideas that will work for you.
Remember, this article does not constitute financial or legal advice. Please consult your professional financial and legal advisors before making any decisions for yourself.
