How to grow wealth
Review your rental return
If the lease on your rental property is coming up for renewal, talk to your property manager about increasing the rent. It’s not a matter of squeezing the tenant; rather it’s about maximising returns on your asset.
Do some research of your own too. Online property sites offer a good idea of market rents for your area. If your rent looks a little lean, ask your property manager for a ‘please explain’. There may also be some simple ways to boost your rental return.
Be an active landlord
As a landlord you should personally inspect your rental property(s) once a year at a minimum. This lets you see firsthand what sort of condition the place is in, and how the local neighbourhood is shaping up. No one cares more about your property than you, and if it isn’t being maintained to your standards, it could be time to invest in some professional repair and maintenance services, or select a new property manager!
Look at ways to add value
Undertaking improvements to your property can boost its market value, potentially allowing you to raise the rent when the current tenant moves on or help to retain a good current tenant.
At the cost effective end of the scale, other tips to add value include a fresh coat of paint which can provide a quick spruce up. If your budget permits, adding a carport or revamping the kitchen can reap rewards in terms of increased rent.
Put equity to work
According to CoreLogic RP Data, residential property values across our capital cities have risen almost 10% over the past year so you could have more equity in your rental property than you realise. This is a valuable resource that can be invested to grow your wealth further. Talk to your lender, financial adviser or mortgage broker about using the equity in your investment property to fund additional investments – now may be the time to act while interest rates are at historic lows.
Review your current loan structure
Your investment loan can play an important role in the success of your rental property. Consider your current circumstances and whether your loan still fits your needs. You may decide for instance that you’d like to lock into a fixed rate while rates are low or you may be ready to move from interest-only payments to interest plus principal repayments. Your investment loan is a key financial tool so make the most of all the features it has to offer.
Contact us today – Nathan Vecchio – 0410 000 689