Find the right property, property manager and tenants for a great future investment! While the property market has been a debateable investment over the past few years, if you are able to hold onto your investment property for now, it could mean big bucks in your future.
Here is your Landlord’s Toolkit to guide you on your investment journey.
Step 1. Buy a property
This is obvious however, where you should buy may not be. Location is a key factor to a successful investment. No investment property that is in a good area will remain vacant for long in between tenants. Do your research. Find out which areas are desirable and what your budget can afford. For Western Australia, coastal and inner city suburbs are often most sought after in the rental market.
You should seek advice from your accountant on how to best structure the purchased based on your circumstances. Some issues to consider include issues such as government grants, finance, negative gearing, building depreciation allowances, capital gains tax, land tax and asset protection are all important aspects.
Step 2. Understand the legislation
Before you invest, it’s important you understand what you are legally required to maintain on a rental property, and the specific rental legislation according to your state or territory. Your lease agreement is extremely important, so legal advice is essential.
Step 3. Appoint a Rental Property Manager
If you quite literally want your investment property to be out of sight, out of mind, then you will need to hire a property manager. If the air conditioner breaks or a tap leaks, they will take care of it for you. Whilst you may be able to manage one investment property on your own, if you want to build a portfolio, you’ll need some help. It’s like setting up a business and leaving the day to day running of it with a manager. If done right, it can be entirely stress free and allow you to buy houses anywhere in Australia.
Step 4. Find quality tenants
This is where your property manager will shine. It is their job to get as much information on your prospective tenant as possible. For example: How many people will be living there? Do they have a stable income? Are they short term or long term? Do they have pets? What is their rental history and do they have references? All of the above questions will help to ensure you find good quality tenants, making your investment as stress free one!
Step 5. Maintain the property
Once you find good tenants it’s important you look after them, and in turn, they will look after your house. Keep them happy by fixing anything quickly and efficiently. Remember, repairs and maintenance jobs are tax deductible. Consider Landlords insurance for your piece of mind. Your insurance covers you should something major happen to the property; it can be used to recoup costs from damage caused by domestic pets or by the tenants; and it can compensate you for loss of rental income if your property is severely damaged.