Owning an investment property can be a great way to generate wealth. While your investment property is increasing in capital value, you have the opportunity to earn an income from it along the way. Property can be a very attractive asset for many investors.
As a landlord, however, there are a few things to keep in mind to make your investment journey a more rewarding experience. The following tips can help you better understand your role as a landlord, and how you can achieve the most from your property investment.
Tip #1 – Approach Property Investing with a Professional Outlook
When you treat your investment property like it’s a business you minimise the chance of making costly errors; whether that is deciding to buy a property in the right area, or choosing the right tenant for your property. Professional real estate investors approach every decision about assets in their portfolio very carefully and deliberately, maximising the potential for success.
Tip #2 – Purchase in the Right Location
Though you may like a sunny beachside location with a brand new home built on the block, modern fixtures and fittings, as well as luxury comfort features like a pool and entertainment area, it is recommended you exercise caution as this kind of property may not be suitable for the local rental market, or a first home buyer who may want to buy your property in the future.
Ask yourself: is there a high demand for rental properties in the area like the property I am considering buying? Doing your homework to make sure your property is a good fit for the local real estate market is one of the foundations for successful property investment.
Tip #3 – Choosing Excellent Tenants
There are plenty of scary stories out there about tenants who damaged the properties they rented or left suddenly owing money. While this is definitely not the norm, making sure you select the right kind of tenant can make a huge difference. Good tenants not only pay rent on time but will tend to take good care of your property, just as they would if they owned the property themselves.
A Vision Property & Finance expert can advise you about how you can buy the right kind of property insurance to make sure you are protected as a landlord.
Tip #4 – Regular Maintenance and Repairs
Knowing what needs to be done immediately, and what can be scheduled later, is an important skill when it comes to carrying out repairs and maintenance.
It’s important to fix serious problems as soon as possible. However, beyond this, carrying out regular, programmed, repairs and maintenance can head-off serious issues before they occur, and help to protect the value of your property should you later decide to sell it
Tip #5 –Planning Your Exit Strategy
At some point, after you’ve enjoyed years of positive cash-flow rental income, it may be a good business decision to sell your real estate asset and enjoy the benefits of the capital growth that has accumulated over the years.
Deciding exactly when you have reached this point is something that is unique to every individual property and investor. Many professional investors, however, decide to sell their property well before it reaches a stage where it costs more to keep than to sell. Often they will then re-invest the proceeds in another property which is at a different stage in its investment life-cycle.
Tip #6 – Get Advice from Professionals
Seeking advice from professionals all the way through your real estate investment adventure, from your mortgage broker who can help you choose the right loan, through to a good property manager who is able to steer your property through the market, is a key to succeeding with property. You can even save a ton of time and money along the way, allowing you to plan your other financial goals.
Are you considering investing in property?
Ring Vision Property & Finance today and find out about the property professionals we recommend to help take care of your investment property. Call on 1800 004 663 or contact us to check out our industry-leading programs.