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How to get more from your rental property

Renting out your property investment can yield great returns. However, there are simple things you can do to make your investment even more appealing to a renter’s real estate market.

Here are some things you can do to get the most out of renting tenants.

Location

When scouting possible investment properties, look through the eyes of a potential tenant. There are three factors, which will drive up rent prices, regardless of suburb. These are:

  1. Walking distance to cafes and recreational areas
  2. Walking distance to shops (or even corner shops for the essentials)
  3. Walking distance to transport.

However, there are other things to consider, within these parameters. Consider the following, when choosing an investment property.

  • Main roads – try to avoid these at all costs. They increase noise and achieve less capital gains for renting.
  • Orientation – which rooms face which direction? As a rule of thumb, a property with living areas facing north or northeast are preferred.
  • Aesthetic surroundings – if neighbouring properties and streets are well-maintained and attractive, properties will be able to fetch higher rents.

Renovations

When it comes to pulling increased rent, very little needs to be done to jazz up a property.

“Fresh paint and carpet will make a huge difference,” says John McGrath of McGrath Real Estate. “You can smarten up kitchen with new benchtops and appliances, and in bathrooms, a new shower screen, vanity and re-enameled bathtub will do wonders. You want the property to look clean, modern and appealing to tenants. Keep your décor simple and neutral.”

Investing additional money into your investment property’s appearance will draw increased demand for the property, which should equate to higher rents from tenants.

Look for the cracks

As with any property, before purchasing or during maintenance, you should keep any eye out for certain issues that may crop up. Be on the lookout for things like building defects, cracks and chips and, if present, aim to fix them as soon as possible.

Also, don’t let pesky pest problems run amok. Should there be any infestation problems in the property, hire the services of an exterminator immediately, before any damage is done.

Inside isn’t everything

While there is a tendency for owners and real estate agents to look at the inside of a property, just as important is the appearance of the outside areas. Invest a little money in the garden or outside entertaining and dining areas and these could become the major selling feature for potential renters.

“Many times when I’ve been showing a family home, I have seen the sale made when the buyer steps into the backyard,” says McGrath. “They look around the garden and visualize themselves having barbeques and playing with the kids.”

When it comes to getting the most out of your property investment, it requires more thought than reciting ‘two-bedroom, two-bathroom’. To maximise possible rental prices, increase the demand for your property within the market of renting.

For advice you can trust book a complimentary first appointment with Switzer Financial Services today.

Important information: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. For this reason, any individual should, before acting, consider the appropriateness of the information, having regard to the individual’s objectives, financial situation and needs and, if necessary, seek appropriate professional advice.

Published on: Friday, August 06, 2010

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