Maximising your return on investment and keeping your property rented out can be a tough ask on any landlord. It’s time-consuming looking after a rental property and this can mean that sometimes landlords make big mistakes in the process. Often the simpler the solution, the more problems it can cause later.
Here are 5 things you need to do:
Consider your applicants carefully
If you’re rental is worthy, you’ll get a ton of applicants. It might seem easier to just approve the first one who can pay rent. However, putting some thoughtful consideration into who you want living in your investment property can lessen your chances of ending up with bad tenants. Whether it’s a missed payment or damage to your property, bad tenants can potentially end up costing you a lot of time and money. Ensure you screen applicants and complete all relevant background checks.
Complete all maintenance and repairs
Keeping your investment property in good condition can be quite expensive and many landlords leave it until it is absolutely necessary. However, avoiding repairs and maintenance can end up costing you more in the long run. Issues such as mould, pests, or plumbing problems can worsen and cause major damage to your property in a short amount of time. The longer you leave it the more likely it is to be an expensive fix.
Choose the right rent rate
You want the maximum amount of money for your investment property, but you need to consider the rental market. High returns are the goal but if you put the rent too high your property may end up sitting vacant for longer as tenants choose a more affordable option. The other problem can be in setting the rental price too low just to get someone into the property. This will mean less return for you and may attract the wrong type of tenant. Consider comparable rentals in the area and price your rental appropriately.
Trying to save money by not taking out landlords’ insurance can be the biggest mistake you ever make as a landlord. The money you save might be nothing compared to the costs you have to cover when a tenant can’t pay their rent or they badly damage your property. The rental bond might not cover these expenses and you’ll be out of pocket. Landlord’s insurance is there to protect you from these situations.
Treat it like a business
Managing an investment property properly and making a profit can take a lot of time and hard work. Avoid spreading your time and money thinly between too many properties. You need to put in the energy and money to make the business of being a property investor profitable. If you don’t have the time and energy to manage your property, then you need to hire a property manager who can manage your property for you.