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Dec 9, 2022
3 factors to consider before becoming a landlord
If you are weighing up diversifying your investment strategy and purchasing a rental property, it is important to be aware of many factors that will impact your journey as a landlord before you jump into the property investment pool. It is not as simple as purchasing the property, finding a tenant, and then sitting back to relax while the rent covers the mortgage. You may find a great property that has no repairs and an excellent yield which will mean that there are minimal future costs, however, the reality can be far different. Work out your investment strategy Your financial advisor will help you plan out your strategy and understand your affordability for purchasing an investment property. They will likely provide you with a budget that you can work with and may even make recommendations on areas for investment that may fit with what you are after. Where you purchase may determine the price that you pay for the property and the yield that it may have the potential to make each year. It is wise to research areas and speak with agents about returns before purchasing so that you can work out if the property is likely to be positively or negatively geared. Be mindful that rents will increase in line with demand and not necessarily when interest rates increase which may impact your affordability. Make allowances for ongoing costs When you make an investment in a property, the assumption is that there will be tenants in the property paying rent to you or through an agent throughout the life of the investment. As such there will be usual wear and tear on the property and costs to consider can be as simple as a leaking tap or appliance repairs to extensive items like roof repairs, fencing, or a burst hot water system. As a landlord, you are responsible for the repairs on these items, and it is smart to allow a buffer from the rent that is put away to cover minor or even major repairs that may need to be done. There will also be a life span on items like paint, carpet, kitchens, bathrooms and appliances and a savings buffer to plan for these future items will save future stress if it is already planned for. Find a great property manager to make becoming a landlord easier Employing a great property manager to manage your investment is one of the best decisions that you can make as a landlord. A professional property manager is well versed in the requirements of the legislation to cover you in case anything goes wrong at the property and will provide professional recommendations and advice on what needs to be done to maximise your investment. For the minimal cost that you invest in fees, they will find and help you select great tenants and work through resolutions should the unexpected happen. They will also work with trades to find competitive prices when it comes to repairs and maintenance. They can also advise you on the current rental market and advise if the rent needs to be increased depending on market conditions, and the current tenants in the property, working with you to find the best solution. If you are looking for your next investment, contact our sales team to talk about our available properties. They will also connect you with our property management team to discuss your investment property options. Additional reading: why should I hire a property manager?
Dec 7, 2022
Tips for managing your mortgage stress
Changes in markets, the cost of living and rising interest rates can put a strain on mortgages and increase the level of stress around day-to-day life activities. Rather than get into overwhelm with the additional load, there are steps that you can take to lighten some of the pressures of mortgage stress. If you are feeling additional pressure, it is a good idea to talk with your lender or financial advisor for solutions that will help to ensure that you are staying on top of your required payments. They will be able to offer a range of solutions based on your needs and affordability. Declutter the budget When was the last time that you sat down and took a look at your budget? Do you have a budget that details your income and expenditure or at least looks at what’s coming in versus what is going out? It is a great time to declutter that budget, put all the monthly expenses down and analyse where your money is going each month. You may find that you are paying for subscriptions or services that you no longer use or identify areas to tighten up spending habits. Renegotiate on utilities, insurance, and repayments When looking at your budget, you may find that you are spending larger amounts on utilities, insurance, and other repayments. It is wise to take the time to research other options available on the market to see that you are getting the best deal. The Australian Government has created a very useful website to easily check all available competition within the energy market and provides estimates on how much each company charges. You may find that in many cases, you can renegotiate interest rates on your loans with the bank, and plans with utility and insurance companies. It is also great to investigate government rebates that are available to see if you are eligible for assistance. Check your property value When was the last time that you checked in on the value of your property? Now might be a good time to check in with your real estate agent on the current market value for your property and talk with your bank about options. A sales agent will be able to appraise the property, provide comparables and give you an estimate of what the property may sell for in the current market conditions. This can give you a more informed decision of what your property is worth and help with making budget decisions both now and in the future. If you would like a free market appraisal of your home, contact our sales team who are happy to help.
Nov 18, 2022
What are the benefits of landlord insurance
Purchasing an investment property can be an exciting step in life and it can be overwhelming as you work through the steps of tasks that you need to have organised to ensure that your property is ready for new tenants. One factor that is often overlooked is landlord insurance and how important it is in covering you in case the unplanned happens during the lifetime of your investment. What is landlord insurance Landlord insurance covers the rental property for the duration of a tenancy and between tenancies for unforeseen events that may occur at the property. It will cover incidents like damage, theft, costs associated with a lease break, rental default and any eviction costs that may be required. A good policy will also cover public liability in case anything should occur to the tenants and guests on the property as well as for storms, fires, and floods. Risks versus benefits Any investment comes with risks and while you may be lucky to have an investment that never has defaulting tenants or damage to the property via the tenants or weather events, there is always that element of risk in the what-if. The benefits of landlord insurance are the protection against the unknown, especially in changing markets. While your property manager can thoroughly check applicants prior to approval for tenancy, we can’t always predict what may happen, and this is where insurance will cover if the tenant stops paying their rent, breaks the lease or damages the property. A good policy will also protect in cases of strata buildings. A strata building insurance policy will only cover building facilities and not the individual apartment. Should an incident like flooding occur from a burst pipe or mould takeover, you would need to defer to your own policy to cover the cost of contents repairs and potential compensation to the tenant. In cases of damage by the tenant, remember that only the equivalent of four weeks is collected from the bond and in the worst case, this may not cover any rent arrears, cleaning, or damage. The costs of the investment There are many specialised landlord insurance policies on the market and the costs for the policy will vary depending on the state that you are in and the value of the property. It is wise to shop around for a good insurance policy that covers the protection over the investment and look for one that covers loss of rent, pet, malicious and accidental damage as well as natural or otherwise disaster events. Don’t forget to check the excess in addition to the premium, a lower excess may mean a higher premium and that is worth weighing up. If you would like to know more speak with one of our property management team who would be happy to help. Another thing to consider for your investment property is compliance awareness.
Nov 13, 2022
The benefits of video in selling your home
In an online world, prospective buyers will look to the property portals and websites in the search for their new home. A professional video walk-through of your property can be one of the most impactful first impressions that a buyer may have before they attend the inspection. There are great benefits to using video in the promotion of your property for sale including getting the listing in front of more buyers and the chance to sell the property faster. Reach more buyers faster A professional video inspection can be launched online on the property portals and the agency website as soon as the property is listed. There isn’t a need to wait for an in-person inspection and potential purchasers can view the property online instantly. Videos reach out-of-area buyers One benefit of online videos is the reach that it provides to out-of-area buyers in a way that still images can’t. A virtual walk-through allows prospective purchasers to view the home if they cannot make the inspections in person and can increase buyer competition for the home. Social media promotion Using video when promoting the property on social media platforms in addition to the property and agent portals can increase buyer reach especially as social media changes move more to video to appeal to consumers. Communicate the features and benefits of the property Video inspections can explain the key features and benefits of the home and your agent can communicate commonly asked questions through this type of marketing which can assist in pre-qualifying buyers. They can also highlight lifestyle features and the location and community benefits of the location. Increase property interest and potential value A well-presented video is an engaging way of attracting buyers, especially when there are multiple listings in your market, and your property needs to stand out from the crowd. It will also ensure that there are more qualified buyers who attend the inspections. Professional video walk-throughs of the property can capture the attention of prospective buyers both locally, interstate and overseas and are an excellent way to show the property at its best and increase the interest and value of the property. If you would like to know more about how professionally presented video inspections can help in the sale of your home, speak with our sales team during your market appraisal about this worthwhile investment.
Nov 11, 2022
Pre-settlement inspection: check your checklist twice
Purchasing your first or subsequent homes is a large purchase whether it’s a home to live in or a property that you are using for investment. The pre-settlement inspection is important to ensure that you have ticked all the boxes on your checklist prior to settlement and any issues are addressed. Book in the pre-settlement inspection date Speak with your sales agent and book in a time to carry out the pre-settlement inspection and walk through the property. The sales agent will coordinate a time with the current owner or tenants of the property prior to the date of settlement. Have your reports on hand Familiarise yourself with the contract as well as the pest and building reports prior to your inspection to know what you are looking for. Take copies of the reports to the inspection with you so that you can check off and note any areas of difference. Note any areas of damage or repairs During the inspection ensure that all contract inclusions are with the property and check any repairs that were required to be completed prior to settlement. Note down any concerns or areas that need attention and discuss these with your agent and solicitor who can address any issues with the vendor before settlement takes place. Check appliances, electrics, and plumbing On your walk-through, turn on light switches and check electricity including light globes, rangehoods and oven lights as well as any appliances like dishwashers. Turning on taps, showerheads and checking toilets for functionality can also address any potential concerns prior to the finalisation of the sale. Testing air conditioners and ensuring pool filters are working can address any potentially costly expenses in the early part of your new home ownership. Inspect the gardens and landscaping during inspection Walking around the gardens and outside areas during your inspection will give you the opportunity to check that the property is in good order and that all plants and inclusions have been left at the property. During this inspection, you can also check for any concerns with eaves or guttering, exteriors of windows and leaking taps. For ease you can create a checklist prior to the inspection for reference and check off as you walk through the property. For any concerns that you may have or areas that need to be addressed, speak with our sales team who can clarify items with the vendor as well as the vendor’s solicitor to guarantee that settlement will go through at the agreed date. Buying an investment property? Inform yourself about Compliance Awareness.
Oct 19, 2022
How long does it take to sell a house?
One of the questions that will often be asked when you choose to sell your home, is how long will it take to sell? There are commentators who will claim to know the science behind how long a property will stay on the market before a qualified buyer snaps it up. There are no fixed periods that can be predicted the length of time that a property will take to sell, however, there are several things that you can do as a seller to help ensure that the property appeals to the right buyer, at the highest price, in the shortest possible time. Pricing affects how long it will take to sell Working with your agent and advice on pricing to get it right in the initial stages of the marketing campaign is essential in ensuring that your property appeals to the right buyer and gets the right attention earlier in the campaign. How long it will take to sell the property is likely to be affected by how accurately it is priced. If a property is not at the right price point, it can lead to further weeks on the market and reduce the number of interested buyers. Listening to advice and being realistic about the price based on comparable property sales will help to get the best possible sale price. Be realistic about market changes The property market is a constantly moving object and influenced by a number of factors, however, there are always buyers in any market, as long as you are realistic with market changes. Our agents will work with you to advise of market changes that may impact the sale price and recommend price adjustments if they feel that it is necessary to achieve a sale for your property. Maximise the property value Prior to listing your property and the marketing campaign, our agents may recommend refurbishments or improvements to your property that will freshen the property and appeal to potential buyers. While some improvements may be necessary, there are others that you may discuss that don’t proceed so that you don’t overcapitalise on your investment. Researching the options and your budget will assist in making an informed decision on what improvements are necessary and what are more luxury items that won’t affect the sale or how long it will take to sell. Property styling is also any area that can help declutter your property and show the key features that buyers will look for when looking to purchase. Our agents can work with you to find the best options for styling and recommend the best vendors to help with the sale of your home. Thinking about how you can make your property attractive to a buyer?
Oct 16, 2022
How to create a buyer attractive home
Attracting people to your home is key to getting a successful sale at a maximum price and there are some essential areas that potential buyers may look at when it comes to their list of requirements in living spaces and may ultimately determine if they choose your home to buy. Be smart about areas you focus on It may seem tempting to invest in changing spaces to make areas larger or create a specific use for one area, however, it is wise to treat the property like a blank canvas as many buyers will have different ideas for how they would use the living space. Rather than limit the number of buyers that may show an interest in the property, keep an open mind and options around your spaces to appeal to more buyers. Consider your living spaces before selling Many buyers will look at the functionality of the living spaces in the home and test their versatility against their requirements as a buyer. They may look for areas like more storage options, or hidden storage and areas for a home office that may integrate into living spaces. Larger bedrooms to allow children more space to move or play and clever bathroom and laundry solutions that incorporate elements of areas like mudrooms are sometimes options that will attract potential buyers. Buyers will consider what the energy rating is Sustainability is no longer a buzz word and many home buyers will look at the energy ratings that a property has and if sustainable measures can be easily installed or upgraded on the property. Think of areas like window glazing and compliance, solar energy, water efficiencies and electrical efficiencies like LED lighting throughout the home. If these are already installed, they may help with attracting buyers at the best price. Focus on the wow factor rooms If you do decide to invest in improvements prior to sale, look at the rooms that a buyer will look to for the wow factor or the luxury inclusions in areas like kitchens and bathrooms. Does the kitchen have a butler’s pantry or integrated appliances, is there a deep bath in the bathroom and more than one bathroom on the property? If you have pool areas or are close to the beach, are there outdoor showers to rinse off and change before heading into the property? Before looking to make changes or upgrading your home, talk to one of our sales agents about recommendations that they have and the difference this may make to your sale price. Do you have an interest in smart homes? If your property has smart features, you may also like to highlight them to potential buyers.
Oct 13, 2022
What happens if I break my lease?
The best-laid plans don’t always go according to the path that you set out on and changes in life circumstances can occur. It may be that you need to downsize or relocate for work or reasons outside your control. If you need to end your tenancy before the lease term is complete you will need to break your lease. It is possible to break your lease should you need to, however, there are requirements and costs that are associated with breaking the contract. What are the fees to break my lease? Depending on which state you are renting in will determine the costs that you may be liable for when breaking your lease. Some of these costs may include: A lease break fee is the equivalent of a week’s rent or more depending on how far you are through your lease agreement. Potential re-letting costs including letting fees and advertising costs Rent until a new tenant is found When is the lease deemed broken? It is mindful of being aware that the lease agreement is not deemed to be broken until you have moved out of the property and handed back the keys to your property manager on vacate. Before this time, it is important to provide your property manager or landlord with the required notice to vacate the property and details of the date that you will be handing back the keys. They will then communicate with you the terms and requirements under the lease break so that you can prepare for your vacate day. Rent is still payable on the property until the date that you hand back the keys and after this time, the relevant lease break costs will come into effect. Do they need to show people through? The agent will usually advertise the property as soon as possible once you provide notice to vacate. They will aim to find a new tenant in the shortest possible time to minimise the costs of a vacant property. It is important to allow access for inspections so that a new tenant can be found, which in some cases can also reduce your costs, depending on the lease break requirements in your state. What happens if the situation is outside my control? There are sometimes extenuating circumstances that are outside your control which may deem a reduction in the lease break costs that you are liable for. Situations that may be unavoidable may include: Death of co-tenant Acceptance of temporary crisis accommodation or a domestic violence situation Acceptance of social or special care housing Experiencing financial hardship Breach of the lease agreement conditions by the landlord If you do feel that you need to break your lease agreement for any reason, reach out to our property management team who can talk you through the obligations and requirements of your tenancy before you provide notice. What is a Residential Tenancy Agreement