Whether you currently have an investment property or plan to in the future, being aware of expenses you are likely to run into as a landlord in the Upper North Shore is so important. Our General Manager of property management, Jyoti at Ray White Turramurra/Wahroonga, shares her tips on how landlords can avoid unnecessary expenses to help reduce property outgoings. Find out how to become a savvier investor and extract more from your rental property.
1. Understand and be aware of common expenses
Being aware of the costs you might come up against in the Upper North Shore is important for managing the costs and time required to address these issues.
In the Turramurra and Wahroonga markets, there is a diverse range of investment properties including apartments, townhouses and free-standing homes.
Roofs, gutters and paint regularly require attendance in these types of properties. Electrical repairs are another common request we receive. As the leafy green Upper North Shore is abundant with trees, regular checks to ensure plumbing is not being disrupted by tree roots is imperative.
Other regular outgoings to be aware of are land tax and strata levies.
2. Find the right tenant
It all starts with the tenant selection process. The right tenant will help to keep your property in great condition. Our recent blog, ‘What makes a good tenant’ outlines advice for landlords for a stress-free and thorough tenant selection process.
Proactive communication with your tenant can also help to curtail unnecessary costs and catch minor maintenance jobs and repairs before they become expensive. A professional Property Manager will open the lines of communication with your tenant.
We understand that the costs of regular maintenance on a rental property can be a burden, but keeping your property well maintained could help you avoid large scale repairs and emergency call out fees. This is especially important for older homes on the Upper North Shore where a lack of regular maintenance can leave the landlord with a hefty bill to rectify roof and plumbing issues.
Annual servicing of electrical appliances (such as air conditioning, dishwashers, tumble dryers, washing machines and fridges, where included in the lease) and roofs are important, as is pressure cleaning hard surfaces every six months. We also recommend quarterly gutter cleaning and tree pruning which will keep the property neat and tidy and your tenants happy, as well as saving you the hassle of having it done when a tenant vacates the property.
Include lawn and garden maintenance in the lease agreement to give you peace of mind and arrange regular drain checks in areas abundant in trees to avoid blockages and potential flooding into the home.
4. Foster an expert team
There are 3 key people you need on your investment property team: an accountant, and insurer and a great property manager.
A professional quantity surveyor and accountant can work with you to help you manage your deductions and depreciation more efficiently and stay abreast of federal and state policy changes that could impact you as a landlord.
Do you have landlord insurance? Not all landlord insurance is created equal, excess and inclusions can vary substantially and the wrong cover could leave you out of pocket. Speak to your property manager about the various options available that could suit you as this can be a good safety net for landlords. This may cover tenant-related risks which may be out of the landlord’s control such as loss of rental income.
A great property manager will advise on necessary maintenance, effective communication with your tenant and help you compile the paperwork you need for your tax returns. This could save you substantial costs in loss of rent, maintenance and tax.
Bonus Tip: At Ray White Turramurra/Wahroonga we encourage landlords to become part of their Strata committee. This allows landlords to have a say in financing as well as the upkeep of strata titled building. This all contributes to the leasing process, lowers the chance of vacancy and assists in achieving a higher rental return.
5. Keep your tenant happy
Having a happy tenant who will not only look after your property but stay in the property for the desired period of time can save you the cost of maintaining a vacant property and loss of rent during this time.
Fostering a positive relationship can also save you, as your tenant is likely to only contact you when a genuine issue arises, reducing the time you need to spend resolving unnecessary issues.
If your property is on the rental market and is overpriced this cost can skyrocket the longer your property is vacant, a small rent reduction can save you more in the long run than a vacant property that sits on the market for weeks.