Tips for property investors on rental property profitability
When you’ve invested in property, you want your investment to be profitable and yield a good return. However, it’s all too easy for the profitability to be eroded and for property investors to end up out of pocket.
The good news is that Mary and David Vinsen can provide you with strategic advice on how to make your investment property profitable. Between them they have over 50 years of property investment and management experience. They’ve been through numerous peaks and troughs in the property markets, and know how to make property investment profitable.
Here are Mary and David Vinsen’s 7 tips for property investors who want maximum returns:
Mistake #1: The rent is too low
Charging too low a rent is a common mistake made by people who are managing their own property investment portfolio. They either aren’t aware of how much rent they could be charging, or else they’re afraid to confront a tenant about a rent increase.
Tip: Mary and David Vinsen have the highest average rents in the areas they service. They continually monitor rental trends throughout Auckland, and will increase rents methodically, as permitted under New Zealand laws.
Hint: You can find out how much rent you could receive with a FREE rental appraisal. Get an appraisal
Mistake #2: Too long between tenants
Let’s face it: when a tenant moves out, it can cause quite a headache. If you don’t have slick systems and processes in place, it can take weeks to find a new tenant. This vacant period can completely erode your profits in your rental property – and you’ll have to spend many hours of your spare time advertising for new tenants, gathering application forms, and conducting reference and credit checks.
Tip: Mary and David Vinsen have the lowest vacancy rates in the areas they service, and the quickest turnaround times for new vacancies. Plus they have a database of tenants who are looking for a property to rent.
Mistake #3: Selecting undesirable tenants
Not all tenants are equal, yet in a rush to fill a vacancy it can be tempting for someone managing their own property to accept a less-than-desirable tenant, because they’re the first one to come along. Or they may omit making the all-important reference and credit checks.
An undesirable tenant can be a very expensive tenant, as this kind of person is likely to cause damage or skip rental payments. You want to avoid this mistake at all costs!
Tip: Quinovic Parnell has a proven and robust system for vetting Rental Applications. This includes undertaking thorough reference and credit checks, using Quinovic’s set procedures, to find you a great tenant.
Mistake #4: Disputes resulting from poor Property Inspections
Compiling a detailed Property Condition Report is a job that takes many hours. And then completing Property Inspections against these detailed Reports is also a big job.
So it’s hardly surprising that many property investors who manage their own properties may not be focused on Property Condition Reports and inspections. Some property management companies take shortcuts with this work… and this carelessness can cost you dearly.
(This is something that Quinovic Parnell Principal Mary Vinsen knows from experience, when a new refrigerator she had purchased for an investment property went missing. The property was being managed by a sub-standard property management company in Wellington.)
Tip: Not only are Quinovic Parnell’s Property Condition Reports highly detailed, they are also accompanied by photographic records. This sets the benchmark for the tenancy, and is also accepted as evidence by the Tenancy Tribunal, if necessary. This protects your assets from damage and theft.
Mistake #5: Not reacting promptly to rent arrears
Confronting a tenant about a late rental payment is something that many owner-managers will try to avoid. Most people simply don’t enjoy confrontation, and simply hope that the matter will resolve itself. Or perhaps you are overseas and simply can’t attend to the problem in a timely manner.
The truth of the matter is that the longer rents are in arrears, the less likely you are to recover the money.
Tip: The property managers at Quinovic Parnell monitor all rental payments every day, and a tenant will be contacted if they are even just one day late with their payment.
Mistake #6: Not increasing the rent at every opportunity
By law, you can legally increase the rent every 6 months. However, many owner-managers are wary of rocking the boat with their tenants and do not take advantage of what they are legally entitled to do. This is despite rents in Auckland continually rising, as a result of the increased demand for housing.
Tip: Quinovic Parnell will take every opportunity to increase rents, as this is a key factor in making your property investment profitable for you.
Mistake #7: Not using your property to its full potential
Sometimes it’s the little things that make a big difference, and property investment is no exception.
The decisions you make on the choice of floor coverings, heating system or paint colours can have a significant impact on the amount of rent that a property can attract.
Tip: Mary and David Vinsen and their team know exactly what you need to do to your property to yield the best rental return. Following this advice can make the difference between an average return – and one that puts a smile on your face.
Get this type of strategic advice when you meet Mary Vinsen for your FREE rental appraisal. Get an appraisal