Six mistakes rental owners should avoid
Whether you’ve just become the owner of a rental property or have had your investment for years, the aim of having that asset is to improve your financial position in the short and long-term.
Any investment property should provide an ongoing return in the form of rental, but also increase in value to offer long-term capital gain that you can tap into in the future as part of your overall financial plan.
So, how can you ensure both those long and short-term aims are met?
Well in most cases it’s about avoiding some common pitfalls that investors encounter. So, let’s look at six mistakes rental owners should avoid in the interests of having an investment that meets their needs.
Not having insurance
A property is a major financial asset that should be protected in case something goes wrong, and that’s why insurance is a must.
In the case of a rental property, this insurance encompasses three key areas:
Landlord insurance – which protects against rental occupier damage of the property and lost rental income in the event of a disaster.
Building insurance – which covers the cost of rebuilding or repairing the property in the case of an unforeseen event.
Public liability insurance – which protects the owner of the property should someone injure themselves on-site.
Failing to keep abreast of market conditions
Like anything, rental market conditions change over time, which makes it important to stay abreast of what’s going on.
These conditions impact things like demand for properties in the area, along with the rental price they command.
Knowing the market conditions ensures your property is priced correctly, and attracts and retains the right type of rental occupier.
Not having a good accountant
When you own a rental property, a good accountant is a must. They can help you claim potential tax deductions for the property and assist with areas like negative gearing, or capital gains tax when it comes time to sell.
Not knowing the rental regulations
In every state and territory there are laws that govern rental properties and outline the rights and responsibilities of the property owner and the rental occupier.
Understanding your rights and responsibilities, as well as those of your rental occupier is essential and the reality is these laws can and do change over time.
Not keeping on top of maintenance
Repairing your property when required and regularly maintaining it protects the value of the asset in the short and long-term.
Timely repairs and maintenance are also requirements under rental law to ensure the property remains safe, secure, and inhabitable.
That’s why you should budget for repairs and maintenance each year, in the knowledge this is an ongoing cost that ensures your property retains its value.
Not having a property manager
A property manager is the trusted expert who can help you navigate all of the above and more.
They know the market conditions, understand the applicable law and work with both you and the occupier to keep the property in the best possible condition.
In addition, they ensure you receive an income from the property each week by managing and staying on top of rent payments, and they assist when a rental occupier leaves and a new one needs to be found.
They also act as the intermediary between you and the rental occupier, managing any rental repair requests, inspecting the property regularly and screening rental occupiers at the outset to ensure that renter is a good fit for your property.
How we can help
Our experienced property managers pride themselves on establishing great relationships with both rental occupiers and owners.
We manage every property as if it were our own and you can learn more about our property management services here.
Alternatively, if you are looking to rent a property, you can view the properties we currently have available here.
