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How to Improve your Property Investment to Get The Best Return

So you have decided to buy a property investment and have it rented to get passive income. How do you then make sure that you can have the best possible return on investment through rent? Here are some of the improvements that you can do.

Basic Improvements

The floors and the walls are usually the easiest and cheapest way to improve your investment and make it more appealing. Add a little life to your property by improving on the walls and floor by installing new carpets or tiles.

Make it Look New

You can style the room to make it look homey. Add few new temporary pieces of furniture, decorations and personalization just to help your prospective tenant get a good picture of themselves living in your property.

Improve the Functional Rooms

Kitchen and bathrooms are very functional rooms. Improve these rooms by thinking of how best your tenants can utilize them and then making the necessary adjustments. A good looking & functioning faucet and space for necessities can go a long way in making these rooms look irresistible.

best return

Keep it Simple

There is no need to make significant permanent changes in rooms that are meant to be personalized. Be aware of things that the tenants might want to change anyway. Bedrooms and living rooms are usually personalized by tenants. Having permanent additions can be limiting factor to them. Fix these rooms in a way that it would be easy to personalize for other people. Paint it with neutral colors that can go well with your tenant’s preferential color. Make sure that the bedroom has enough space for any kind of bed they might think of having. A fixed table might be a good idea to you but might be a hindrance to your tenants.

Add A Room

An additional room can increase the value of your home. When having your property rented out, an additional room can increase the rental fee you can charge. If the area permits and if you have the budget for it, it might be a good idea to add a room to your house. It can also get your property to appreciate in value as time goes on.

 

These are a few things that you can do to make your property investment more appealing. At the end of the day, you also have to consider your budget and the return. If the average rental is already maximum of your rental charge then it might not be a good idea to spend too much on the house.

Choosing a Property Location

Choosing a property location may be the most challenging part in the process of owning a property. Here are important factors you need to consider when choosing a location for your property.

Budget

The budget is a very important factor when choosing a location of the property. There are so many options of where to buy a property but you can trim down the location options when you know what you can afford.

City vs Suburb

Do you want to enjoy proximity to everything when you live in a city or do you value a location that offers a quiet and peaceful environment? There are several advantages of living in the city but there are also disadvantages. Same can be said for living in a suburb, so take note of the things that are very important to you to help you choose.

Neighborhood

Do a physical inspection of the neighborhood you want to live in. It is important that you check them during the day and during the night. Check their proximity to stores, amenities and activities that you may enjoy. It is also important that it should be near a clinic or hospital in case of emergency. If you practice a religion then proximity to a place of worship may be a key factor too.

property location 

Explore Neighboring Areas

Another location near your prospective area may provide better amenities than the one you’ve set your eyes to. The houses may be more spacious or have better facilities than your top picks. It is essential that you check out neighboring area to gauge whether or not that area may be a better fit for you. You may regret not checking after buying your property.

Proximity to Work

It is important to weigh in on the distance between your property and the place of work. If you are looking to buy property to live in, then the long commute may have a big impact to your everyday routine. The additional expenses of traveling farther every day and extra time spent on the road can take a toll on you. If you are looking to buy property as an investment, then you need to take note that proximity to the CBD. It may also affect how fast you can have the place rented, it will also affect the rental price.

Availability of Good Schools

If you have a family or is planning to start one, then being near a decent school should be a huge factor. Not having a good school near you can force you to spend more on private schools. If you are planning to have your property rented, then prospective tenants with kids might not be inclined to rent your property.

Safety

A lot of people consider safety as the top priority when buying a property. A property in an unsavory location may be cheaper but you will also have to live in fear. There is also a high chance of losing furniture, equipment and appliances which may be valuable. If you are planning to rent the property out then you may have a hard time finding tenants if you live in an unsafe area.

 Transport

Are there transportation options in the area you are considering? Even if you have a car, there might be a time when you need to use public transportation. Tenants may also be more inclined to rent your property if there are ample options for public transportation. This is something you should take note of if you plan to get your property rented.

 

After taking note of the important details above you need to narrow down your options.

Make a list of areas you want your property to be in. Check out the rates in these areas if you can afford them. List down the pros and the cons of your options. When you already have a shortlist, then it would be easier for you to narrow it down to a few that you can check formally.

Finding a Good Agent and Tenant

the right agent finding

Finding the Right Agent

• Leverage

Gain leverage over the other bidders by offering to move at once. Agents and vendors usually prefer to sell properties at once since a property that stays in the market for quite some time could be less appealing.

• Low but not ridiculous

Making your initial low but not ridiculous will show the vendor of your serious interest in the property.

• Cash at hand

With your pre-approved loan and a deposit ready at hand, agents will see you as a serious buyer. This will put you in a solid bargaining position compared to others who still need to organize their finances.

• Be critical

Keeping a list of defects of the property, even minute ones, can be used to negotiate a lower price.

All property investments involve transactions with real estate agents. It would be to your advantage if you could negotiate with an agent and arrive at a price of the property which fits your budget. Consider these tips in dealing with an agent:

The most important tip here is to always bear in mind that the real estate agent represents the seller and not the buyer.

Finders and Keepers; Finding Good Tenants

finding the right tenant

One element of property investing that is often overlooked is the importance of finding a good tenant. This is especially important when your investment is focused on generating cash flow which stems from rental income. Whether you opt to find a tenant by yourself or hire an agent to do the task for you, it would be wise to find out the following:

• Number of dependents, if any

• Rental background or history

• Financial stability of the tenant

• Lifestyle and occupation

• Contactable references

Watch out for signs such as when the tenant negotiates for the bond as this may signify problems in meeting their rental obligations in the future. Of course, when you do find good tenants, you must also find ways to keep them for as long as possible. The most important way is to offer a fair price for the rent from the start. Be prepared with your area’s rental values as your prospect would definitely be in the know. Another way to keep your tenants is by fixing the problems in the property as soon as they are made known. Respect to the tenant’s privacy is also valuable so establish your inspection schedule or at least give ample notice. A little appreciation goes a long way. Remembering to send them a little something on holidays can help in retaining good rapport with your tenants.

 

 

The Right Coach

This is very simple.

Most “wanna-be” property investors fail because they fail to “act”. They really, really want to do something but they just don’t know where to begin. They start researching and get even more overwhelmed – there is so much out there! Many people then suffer from “analysis paralysis”.

They get so caught up trying to pin-point the best time to buy, the best location to buy in, and the best type of property to buy. In the end, they simply DON’T buy. Many people want to research and research until they are absolutely 100%, without any doubt sure that they are entirely correct and certain of their decision. If they wait till then they will simply never buy. Experienced property investors know you can never be 100% sure you have got it right. Even the most experienced investors get the ‘D-Day’ (exchange and settlement day) jitters. It is human nature to have fear and doubts. Other people want to do it but just can’t work out how to put aside the funds required or manage the cost of investing in property. Others are just not sure whether they should invest first or buy their ‘white picket-fenced’ house for the Golden Retriever and the kids and invest later. Others simply think, “I can’t do it. It would be too hard for me.”

So what’s the answer?

Get A Coach!

 

Why A Coach?

A coach can help you determine things like:

1. What is your definition of success?

2. Do you have a plan?

3. Are you willing to put your plan into action?

property coach house investment

A coach can give you the support and encouragement you need to achieve your goals. They are someone who is on your side, objective and ready to assist with any challenges you may face along the way. A coach will provide guidance and help inspire you to design your financial and life journey. They will celebrate the good times with you and provide encouragement during the challenges. They can teach you to how to examine your financial beliefs and values, trust your instincts and build your excitement to be the best that you can be.

A coach will help you:

  • – Find out where you are at right now.
  • – Look at alternative options should anything not be working for you.
  • – Put into place the new actions to help you reach your desired destination.

At Property In A Box, all our sales agents are trained as property “coaches” not just sales agents. They will not “shove property down your throat”. They will simply work with you, your goals and dreams, and hold your hand along the investment journey.

Previous Article: The Right Management

 

The Right Management

Why Use a Property Manager?

Effective property management is the key to protecting your asset. This is why it is important to have an exceptional property manager. Remember, it’s not just a property, it’s a significant investment and you want it well looked after. Furthermore, you want its value to remain high because you want the best rental return on your investment.

A good property manager will excel in the following:

  • Marketing

Markets your investment properly so as to get the most exposure to the right kinds of tenants.

  • Legal Requirements

Management of all legal requirements. Ensures that all government legislation relevant to your investment property are complied with. Also ready to give you advice on your rights and obligations.
  • Your Rent

Monitors market trends. Ensures that your investment is getting the highest possible rental return. Carries out rental reviews and ensures tenants pay the rent on time.

  • Tenant Selection

Find the best quality tenant for your investment property. Follows strict and professional guidelines in tenant selection. This includes checking references & employment stability. To be sure that the tenant is capable of paying the rent. Also, ensures a good track record in their previous rental history.

property manager investment

Your property manager should also be able to:

  • Agreement Preparation

Makes necessary preparations for the signing of the residential tenancy agreement. Also, arranges for lodging of the rental bond.

  • Tenant Management

Confirms that the tenant understands the terms of the residential tenancy agreement. Also, ensures that the terms of the tenancy agreement are complied with.

  • Building A Good Relationship With The Tenant

A happy tenant is a tenant who stays. They are comfortable contacting their property manager immediately so they can fix any issues.

  • Acting as Negotiator to Any Disputes Between the Tenant and the Landlord

A good property manager manages disputes between landlords and tenants before they escalate.

  • Rent Collection

Provides a good range of options for tenants to pay their rent. Manages if tenants are required to pay rent in advance. Monitors incoming rentals daily. Also, manages any rental delays effectively.

  • Looking After Your Investment

A good property manager knows your property, inside out. They conduct regular inspections of your property (as per the legislation) to ensure it is well-maintained. Also, forwards written report on its condition and any maintenance needed. Gives feedback to help you budget for larger items of expenditure that may be required. Furthermore, a good property manager provides an after-hours contact for emergencies.

right management property investment

  •  Communicating

Communicating well with you on your investment.

  • Saving Your Hassle

No need for you to interact with your tenant at all. Paying bills for you, invoicing tenants for user-pays water costs. Handles any maintenance required. He or she ensures work on the property is well done by directly dealing with tradespeople so as to obtain the best quotes. They can also provide statements for your tax return.

And if you decide to refresh your investment portfolio…

Your property manager should be able to liaise with your tenant and your real estate agent to make the sales process easier, smoother and faster. Or liaise with your mortgage broker regarding access for valuation purposes. Because these things can make it easier for you to refresh your portfolio.
 
The Right Management solution is one of the most important strings to your investment bow. Having the right property management ensures that your investment is being looked after in all aspects. Most of all they ensure that your investment property is always tenanted with only top quality tenants.
 
In conclusion, the Right Management allows you to have a safe and worry-free investment solution that is truly “Set and Forget”.

Previous Article: What is a Buyer’s Agent or Property Aggregator?

Next on the blog: The Right Coach