WATCH VIDEO NOW - My top three tips:
- Firstly, know your rental yield goals – The most important thing about an investment property is that it’s not an end in itself - it’s a means to achieve professional and financial goals. So make the most of it! It’s important to know your yield goals – 3%? 4% or more? Understand how much cash your investment property is producing each year as a percentage of the property’s overall value.
- Secondly, identify ways to increase your rent – Approach your investment property proactively and identify ways to improve the living experience for your tenants. How about fixing up that old kitchen? By spending $10K on a basic kitchen or $20K on a fancier kitchen, you could be making an extra $30-$50 each week in rent and eventually could sell it for much more. Maybe the house needs a fresh paint or repairs need to be done – perhaps you could do up the garden or set up an outdoor entertaining deck? All of these things will allow you to up the rent and add value.
- And lastly, reduce tax – As a landlord you can normally claim a tax deduction for a wide range of the expenses related to your investment property. By claiming tax deductions for interest paid on your loan, council rates, land tax, repairs and maintenances, you’ll avoid high tax bills and other financial implications. Speak to an experienced property manager and your accountant who can advise you on the best ways to reduce tax.
The answers to the commonly asked question, how much should I invest in my investment property? Knowing your yield goals and identifying ways to increase rent and reduce tax is the perfect recipe to enhance the overall value of your investment property.
If you have any questions, feel free to contact our team anytime.