You’ve got to spend money to make money, so the saying goes, and it’s certainly true when it comes to investment properties.
Money spent on the upkeep of your rental property is typically money well spent. We take a look at how a well-maintained rental property is more likely to command higher rent, increase in value and continue to generate returns over the long term.
The importance of regular maintenance
It can be easy to skimp on regular ongoing maintenance, but it might cost you in the long run. Routine maintenance can prevent the need for major – and expensive – repairs down the line. A general inspection of your investment property once a year can highlight areas for repair before they get worse.
Basic annual routine maintenance ideally includes:
- Checking drains and gutters
- Checking for signs of mould or damp
- Servicing air conditioners
- Repairing broken or leaking fixtures
- An inspection of fences, garden walls, the roof and chimneys for any signs of damage
Did you know that many landlord insurance policies require the insured property to be maintained to the standards of the NSW Residential Tenancies Act? Claims may be denied if the property hasn’t been properly looked after.
Breathe new life into your investment property
Routine maintenance is vital for any rental home, but if your property is looking tired you might want to invest in some more substantial improvements.
You don’t need to spend a huge amount to make your property feel up to date.
- Replace yellowed light switches and old-fashioned light fittings.
- Update tired or damaged blinds or curtains.
- Refresh the home with a coat of paint.
- Update the flooring – install new carpets, hybrid or laminate flooring, or sand and reseal scratched floorboards.
- New handles and tapware can modernise a kitchen in an instant, and a new splashback can make it feel brand new.
- Replacing toilets, sinks and tapware in bathrooms or simply re-grouting gives a feeling of freshness and cleanliness.
- Boost your property’s street appeal by repairing the fence, painting the front door and tidying up the garden.
Increase your rental income
You may be able to charge more rent for a well-maintained and well-presented property.
A property in disrepair is worth less than a well looked after home, and that applies to rental value as much as the sale price.
By giving your property a fresh coat of paint, new carpets and doing some upgrades in the bathroom, you can often increase the rent. The same goes for a new kitchen.
Increase your rental yield
How does maintaining your investment property increase your rental yield?
If your rental property is well looked after, it is more likely to attract tenants who will do the same. A fresh, well-kept home is more likely to be rented out quickly, and you may even find yourself in the enviable position of being able to select your ideal tenant from multiple applicants.
Staying on top of regular property maintenance throughout the tenancy encourages good tenants to stay on even once their lease expires.
This all amounts to your property spending less time vacant, and that’s good news for your rental yield.
Increase your property’s capital growth
While timely maintenance and smart improvements might maximise your rental returns, they may also increase your property’s capital growth.
The key is to avoid over-capitalising. There are plenty of renovation projects that will cost you a great deal more than they will ever earn back. Generally, a good rule of thumb is spending no more than 2 per cent of the property’s value on renovation works as a good way to add value without over-investing (with the exception of major works).
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