Beyond the Buy – A Guide to Maintaining Your Investment Property

Photo by Georgia de Lotz on Unsplash

It is not uncommon to hear claims in the media stating ‘Guaranteed way to succeed in the property market’ or ‘Sure fire investment winners’. Statements of this kind are misleading. Investing in property will always be a gamble but there are key strategies which successful investors employ to ensure they best position themselves for future financial security.

What are these key strategies?

● Find a solid property surrounded by infrastructure, which will attract quality tenants.

● Do some number crunching to ensure you are getting the best value for money.

● If necessary, renovate wisely.

● Employ a hardworking and affordable property management agency and listen to their advice.

● Look after good tenants by listening and responding quickly to issues.

● Don’t get greedy!

Pinpointing a property

This is where research and due diligence will pay dividends. A small inner-city apartment may cost you the equivalent of a house and land on the outskirts of town, but which one will be the best investment will depend on what you want to achieve. For long term capital growth, a house with land may prove to have the most options as land values rise. Conversely, a city apartment may attract a higher rental yield and possibly, attract a more reliable tenant.

Visit the areas which you are interested in. Look for things which will make the property attractive to a renter. If appealing to younger tenants or uni students, consider what will be important to them:

● Convenient public transport

● Supermarkets

● Coffee shops

If you are considering buying a house then look for facilities which may attract families, such as:

● Parks

● Schools and child care centres

● Medical facilities

● Shops

Value for money

When buying property in and around Melbourne, take careful stock of rental yield expectations over mortgage repayments and assess these in relation to your investment goals.

Let’s view this from the perspective of both a short term and a long term investor:-  

A one million dollar property close to the city may only produce a rental return of $500 per week whereas a $300,000 buy in an outer suburb, may yield a return of $350 per week. The value in this scenario would appear to be in the cheaper property however, blue-chip inner-city suburbs will likely have the highest capital growth when the market picks up, resulting in longer term investment rewards.

Curbing outgoings

Whether buying at the low or high end of the market, get building inspections done by a professional who will produce a detailed report including costs of remedial work. Issues with wiring, stumps, underpinning and plumbing can mean substantial outlays of cash.

Look for things which may set a property apart and appeal to potential tenants. These features may be:

● Ducted heating

● Ensuite

● Third or fourth bedroom

● Secure backyard

● Solar panels

Management matters

If an excellent tenant is gold to an investor then the best way to keep them happy is through professional, hardworking and reliable property management. A property managers job is not just to receive money, it is to attend to tenants requests and problems in a timely manner, to ensure the tenancy runs smoothly.

As a landlord you can assist this process by fast tracking any maintenance or repair requests and ensuring that the tenant has, as is their legal right, ‘Quiet enjoyment of their home’.

Retain to gain

For every week a property is vacant you are losing money that will take weeks or months to recoup. For this reason keeping good tenants happy and in place is crucial. Raising the rent by $20 or $30 may seem a pittance but to a low income earner it can make a big difference to their lifestyle. The bottom line is don’t get greedy!

By implementing a few simple strategies when buying and leasing out a residential property you can stack the investment odds in your favour. Buy now and by the time the market picks up you will be well on your way to a comfortable and lucrative investment future.

Gail Tucker
I am a beachy type of person, living in Newport Beach, and oftentimes I’ll go for a swim with my daughter. When I’m bored, I’ll help make package boxes for my little girl’s sticker company on Etsy.