If you have an investment property, you want every confidence it’s getting you the best possible return! The key to increasing the profitability of your investment, is to understand how to attract tenants who will pay top dollar or find a way to charge more rent.
While your property’s appearance dictates the rental income it’s able to produce, the presentation of your property is linked to what kind of tenants it attracts. One thing to keep in mind is that most tenants want to feel at home in their rental, so the more you create that, the more likely you will find tenants at a higher rent.
And even an extra $10 or $20 a week in rent increasing your yearly return. Here are some tips to increase your rental returns and they are not all renovations!
Use a good property manager
Making sure your asset is properly managed means finding a good property manager.
Good property managers are hard to find, but make sure:
Update the property
Sure, it might sting a little, but upgrades can produce a healthy return in the future. Make sure to focus on the kitchen and bathrooms, as these areas generally provide the greatest ‘wow’ factor. An upgrade could be as simple as a new coat of paint or replacing the showerheads and fixtures.
Target specific rental markets
Consider your target market, who your property is likely to attract, and work out how best to meet their needs. Many owners make the mistake of renovating and updating investment properties to meet their own personal wants and needs, rather than adapting to the market requirements.
Air con consideration
For some tenants, appliances including dishwashers and temperature control systems, are a make or break. While it’s tempting to want to save money on refraining from buying these features, you’re usually better off if you do. In many areas throughout Australia, having heating and cooling options is an expected norm amongst tenants. Installing an air-conditioning unit which has a reverse cycle is a simple solution that can increase the weekly rent you’re able to charge. It may be an added cost you were hoping to avoid, but these features are a big plus for tenants.
Many tenants, particularly those who rent units, don’t own a washing machine or dryer – as they have never needed to. Providing renters with a functioning laundry is a great way to increase your rental income. And it’s not all that hard to find a decent second hand washing machine and/or dryer for a reasonable price.
Include car space
A car space or two can be a major bonus for tenants, especially in inner-city areas where parking is limited and chaotic. This could mean adding a drive way or installing cover to an existing driveway.
Storage, storage and more storage
Additional storage space, whether inside or out, is another feature that can add significant value to your investment property. No one wants the added costs of having to buy storage furniture, especially after moving! Create better use of space by correctly placing built in wardrobes, wall shelves or cabinets.
Have a pet friendly policy
Have you ever tried to rent while being a pet owner? Many landlords refuse to rent to tenants who have pets, and in some cases, this is understandable. But having a more lenient pet policy can increase interest and most tenants are willing to pay a little more if they can bring along their pet without having to hide them. Just be sure your lease is very clear about what happens with any damages and that you have the proper insurance.
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