Vendor / Lessor Tips
Routine landlord 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.
A lack of maintenance on a rental property not only hinders capital growth of the investment, but also could lead to an injury claim if the property is not safe.
Record Keeping
Be sure to keep your property records (rental income statements and invoices) in a safe location. These will be required for taxation purposes.
Communication
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.
Why Properties Remain Vacant
A property may remain vacant for many reasons whether because of a weak market, ineffectual management or individual characteristics of the property. The main reasons that a property remains vacant include:
• Rent is too high – Rent is based upon the market and what tenants are willing to pay. Your agent should monitor the market to ensure that you are receiving the maximum return on your investment. Rents should not be too high or you will have difficulty attracting a tenant and the property may experience long-term vacancies, impacting upon your income.
• High vacancy rate – If the market has been saturated and there is an oversupply of properties then tenants have more options and a stronger position to negotiate on rents.
• Poor condition – It is important that the property is well presented and maintained to attract quality tenants and compete with similar properties in the area.
• Location – A property may be difficult to access or in a location with insufficient infrastructure, transport, population etc. These factors will reduce the competitiveness of a property compared to similar properties.
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.
You should speak to a qualified insurance professional regarding which policy provides you with adequate cover.
Building Inspection
It is recommended that you engage a professional building inspector 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.
Promptly attend to maintenance and repairs
By promptly attending to maintenance you are reducing the risk of possible tenant injury and preventing a small repair from becoming a larger one.
Budgeting: upgrading & improving 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.
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