The property investment boom down under shows no signs of abating, and many investors are opting to self-manage their properties instead of going through an agent.
This can be a shrewd move, as it will allow you to save money and keep a closer eye on the day to day management of your rental, but it’s important you consider all that self-management involves.
Are you cut out for the job?
Be sure that you have the right personality to keep your relationship with your tenants on a strictly business basis. If a tenant is late with rent, or is breaking the terms of the lease, are you confident you’ll be able to exercise your legal rights unemotionally?
Right side of the law.
As a DIY landlord, you’ll be expected to stay up to date on the relative Acts and legislation relating to your properties, as these vary in each state. Completing a short course in property management is often a good way to start, as it will educate you on the current legislative structures and will teach you how to make sure you’re constantly compliant.
One of your most frequent and important tasks will be collecting rent. You should make sure you set up a clear and concise process with your tenant for their periodical payment. Having this in place from the outset will help avoid drama down the track. Direct Debit is the most reliable and convenient form of rent payment and collection these days, as the control lies with the property manager.
On another note, avoid dropping in to collect the rent from your tenants, and steer clear of part payments. Make sure that there is always one party among your tenants who you can contact regarding any issues with rent payments.
As an investor, ensuring a good yield and making sure your property remains in top condition should always be top priorities. While different states have their own rules on the number of inspections allowed annually, as a rule, you should look to conduct an inspection three months into the occupancy, and then every six months going forward.
Be sure to give your tenants plenty of notice before dropping by to go over the property’s condition, and keep thorough records of the findings of your inspection.
A common trap for first time DIY investors is not complying with the relevant state legislation regarding tenant rights relating to repairs and maintenance.
For example, major repairs like hot water or plumbing will require urgent attention, and in most cases your tenant is within their rights to pay for immediate repairs out of their own pocket, and claim the money back from you, the landlord.
Before you enter into a rental agreement with your tenants, you should have established a list of reliable, trustworthy tradespeople that you can count on to get the job done quickly, and done right once the muck hits the fan.
Appraisals and Increases.
As a landlord, you owe it to yourself to stay on top of your local rental market.
For example, you may have bought an investment property 12 months ago in an area that has seen property prices significantly increase within the last 6 months. All things considered, your property has likely increased in value as well, and correspondingly, so should the amount of rent you are charging.
If your property is occupied and you’re considering raising the rent, it’s also important to consider the terms of the lease, and your state’s relevant legislation.
If you’re interested in learning more about investing in property, and what it would take to get started, why not check out our handy How-To Guide to Investing here?
And if you could do with some more advice, why not start a conversation with The Greater? We’ve been helping Australians with their property dreams for close to 70 years, so we like to consider ourselves the experts. Get in touch with us today – make an enquiry online here.
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