Putting a rental property on the market is no small feat. There are a number…
Spring is the ideal time of year for investors to review their property portfolios, according to leading landlord specialist, Terri Scheer Insurance.
Terri Scheer Insurance Executive Manager Carolyn Parrella said the change of season generally signalled the start of a boom period for the real estate market.
“The weather is warmer, gardens are starting to bloom and properties tend to be more highly sought after in spring,” she said.
“It is also a time when investors may think about ‘spring cleaning’ their investment properties.
“This could mean either getting their properties in order or expanding their portfolios.”
Ms Parrella offers the following advice for property investors to consider in the lead-up to the busy spring season.
Review your investment plan
“Property investors should have a clear investment plan,” Ms Parrella said.
“Property can be an effective long-term investment as it has the potential to increase in value over time and produce regular income.
“Whether you’re buying your first investment property, or your fifth, investors who set up a strategy that extends beyond the settlement date can create a positive experience throughout the life of their investment.
“This holds true if you’re looking for an apartment, unit, townhouse, house or holiday house.
“Consider including your capital growth and rental income strategy and how you plan to manage finances throughout the investment in the plan.”
Ms Parrella said investors generally enter the property market with the intention of making a profit.
“Making sure the rental amount is appropriate is an important step in your wealth creation strategy,” she said.
“Landlords are entitled to raise the rent periodically and spring is a good time to review this.
“No tenant wants to pay more rent, however it is sometimes necessary to implement rental increases to cover the rising costs of maintaining a property.
“Small incremental increases each year, in line with the consumer price index, are often received better by the tenant than large increases on a more sporadic basis.
“Before increasing the rent, however, it is important to familiarise yourself with the relevant legislation in your state or territory to ensure you aren’t breaking any laws or rules.
“For example, you may be required to provide tenants with written notice within a specified time frame before the rent increase can take effect.”
Selling an investment property
“Investors may get a kick start over their competitors by putting their property on the market at the start of spring,” Ms Parella said.
“Those investors who are slow off the mark may find it harder to sell a property if the market is flooded with opportunities.
“Taking the time to prepare the property for market, including addressing any maintenance issues, is a valuable first step and may increase your chances of selling the property faster.
“A property that is well looked after can generally be an attractive proposition for potential investors.”
Expanding your property portfolio
“With an abundance of new properties going on the market, spring is also a time when investors may consider growing their property portfolio,” Ms Parrella said.
“It pays to do your research when looking for an investment property.
“Consider the type of tenant you’d like to attract, for example a family, sole tenant or couple, and choose a home that is likely to appeal to them.
“Look for a low-maintenance property as it will make life much easier for both tenant and landlord and minimise the effort and cost involved in the upkeep of the home.”
Specialist landlord insurance
“Having adequate insurance in place can protect your investment and provide peace of mind if the unforseen should occur,” Ms Parrella said.
“Specialised landlord insurance cover can protect investors from many of the risks associated with owning a rental property.
“This includes covering for risks like malicious and accidental damage, loss of rental income and potential legal liability.
“Standard building and contents insurance policies usually don’t cover landlords for these risks.”