Tag Archives: property investments

Why Specialist Property Management Matters?

Make this mistake with property investments and you’re finished…

Property Management and Protecting Your Property Investments…

Don’t even think about taking on another tenant until you read this report because property management means more than just collecting rent. That’s why investing in residential property must be treated as a business venture…

Your property investment deserves the best property management possible, right?

Would you take the risk of cut price management, as you really do get, or should we say don’t get what you pay for.

The management fees are fully tax deductable. Most residential property investors use property  as a means to build assets for their future financial return on investment.

property management
Don’t Even Think About Trying To Take On Another Tenant Before You Read This!

Screening prospective residents affects every other aspect of managing rental property.

On average, well qualified residents have less lease violations, are more likely to pay rent on time and return rental properties.

This should be a strategic business decision made to support their personal goals, and as such the property needs to be treated as you would any business investment.

Why use a specialist property management company:

  • Complete knowledge of the real estate industry with experienced professional staff
  • Excellent understanding of the rental market and current market conditions
  • Expert knowledge of how to present your property to maximise rental returns
  • Quality internet advertising with numerous photographs with detailed area and property description
  • Current market analysis carried out on new lettings so owners get the maximum rental return
  • Progress updates provided on new prospective tenants for your property
  • Process tenant applications utilising a 100 point ID check, full reference checks and database
  • checks including Barclay M.I.S and T.I.C.A to ensure most suitable tenant is found for your property
  • Preference for rent payment using a direct debit system from the tenant’s bank account
  • Rent paid monthly or twice monthly to your account by direct deposit, fully itemised monthly statement

Engaging a specialist property management company can be a very smart business decision because you’re hiring an expert service to manage your assets.

property management
Engaging a property management specialist…

Just like employing an accountant to help with your tax return…

A specialist property manager takes responsibility for managing an investment property and optimising return for the investor:

  • A fully itemised end of financial year summary of each property to make your tax return a breeze
  • Rent collection and control of rent arrears with full information to owners on the course of action
  • taken to bring rent back in advance as required or eviction as soon as possible after all legislative requirements are fulfilled
  • Full entry and exit reports conducted on all properties to ensure the integrity of your property is maintained
  • Ensuring all tenants remain on a fixed term lease where possible to protect the owners best interests
  • Regular routine property inspections with a full written report and photographs where appropriate
  • All routine maintenance is identified, reported & acted on by qualified and insured trades people in a timely manner to protect your asset
  • Ensure your rent reviews are inline with current market rates improving your cash flow and borrowing capacity….

A specialist property manager can minimise your hassles, because there are many time consuming (often expensive) problems associated with managing an investment property.

These range from sourcing:

  • Right tenants
  • Maintaining property
  • Paying expenses
  • Collecting rent
  • Organising inspections
  • Accurately recording transactions for tax office

There can be complicated problems of dispute resolution with a tenant through an administrative tribunal.

A professional property manager covers all of these issues and protects your interests for a relatively small tax-deductible fee.

The question to ask yourself is; do I really want to be dealing with every little aspect of the day to day management of my property?

Choose a dedicated residential property management specialist can often be an “add-on” service provided by real estate agencies whose principal focus is selling property.

Let’s face it, some agencies only offer this service as a method of more listings for sale.

A specialist property management company does not have a sales department, however specialises in doing one task exceptionally well – property management.

Expert knowledge of the geographic market which is a key role of a specialist property manager knows the pricing and tenant issues for all of the suburbs they are servicing – this is their bread and butter.

They make sure landlords are able to maximise their rental return with highest possible occupancy rate for their property.

A specialist property manager does not have to be located in the same suburb as the property…

Yet their constant  involvement and team of property managers ensures they remain up to date with changes in the market.

property management
Property management…

Image Source:Jacob Grant Property Management

One contact for all your properties because dealing with different individual real estate offices is often difficult – each with their own systems and processes.

Even franchise operations can be difficult as you are still dealing with completely independent operations.

Finding the one agent which covers your needs across the majority of your portfolio is a real bonus.

A specialist property manager also provides consolidated reporting and a key benefit for tax deducations.

National representation means a property management specialist manages all of your properties in each city.

Having offices in key major investment areas nationally allows you to have the same high level of service provided to you for all of your investments across Australia.

Matching right tenants with right property is crucial. You want to know any prospective tenants for your  property are being checked thoroughly.

A property management specialist carefully checks any applicants current and previous rental references, current employment details, and personal references if necessary.

Many property management specialists subscribe to major tenancy databases, where they check if applicant  has been listed by other agencies as causing problems in the past.

A property management specialist takes all of these checks into consideration, and then presents you with the details and their recommendation.

You have final discretion on whether or not to accept the tenants…

Professional presentation of the property along with advertisements on a number of different websites is the best way to find the right tenant.

A professional property manager knows the key features of a property which are in demand and how to present the property in the best light.

Internet advertising and people’s lives becoming increasingly busy, your property manager is available to show properties  to prospective tenants 6 days of the week.

Tenant Protection Insurance is often also called “Landlord Protection Insurance”, this protects the landlord against tenants defaulting on their rent as well as tenants causing malicious damage to the property.

While most owners have this insurance in place, many would not know what they are covered for, what excesses may apply, and the costs they might have to cover until they have to make a claim.

(It is recommended to thoroughly read product disclosure statement and speak with several insurers, including at least  one who specialises in this type of insurance rather than automatically using the same insurer used for your home or car.)

Maximising the best rent means a landlord wants to get as much as possible for their property.

While a property management  specialist wants you to get as high a possible return, they’re able to advise you of what’s a realistic rent at the time your property is available.

It is not a matter of just putting the advertised rent as high as possible and then have no
explanations for the landlord when they can’t find a tenant.

During a tenancy, a professional property manager have systems in place for reviewing and discussing regular rent increases for your property.

The property manager should also communicate effectively about this to tenants so the property has minimal vacancy periods.

Laws and legislation differ from state to state, so you want a national property manager with expert knowledge of each state’s legislation.

Property Management

Thanks to Jacobgrant.com for image source:Jacob Grant Property Management

Property Investments VS Share Investments

Property investments vs share investments – are you in two minds regarding the best type of investment, whether it be property or shares? All investments would ideally be based on sound research, due diligence and correct investment analysis…

 In reality, getting correct advice is a good investment. However there are differences between property and stock market shares which influence people depending on their financial goals and investment needs.

Property investments vs share investments, so do shares actually perform better than property? The fact is shares perform relatively similar to property…for example, a good property investment in a high performing suburb historically doubles every 7 to 10 years and generates a rental yield of 4% – 6%.

property investments
Property investments vs share investments

The total return from a good property investment can be 13 – 14% per annum. Similarly from 1983 to 2009 stock market shares grew on average 8.4% per annum. Now if you add dividends to the stock, this equals to 13 -14% growth per year.

The fact that the return on investment per year is very similar, there are vast differences in involvement, liquidity and the amount of control you get with each type of investment.

Property…historically has shown to be less volatile and is regarded as a relatively secure investment by the banks, which lend up to 80% of the property cost compared to higher volatility of stocks…banks are prepared to lend only 60% of the market value of shares.

As you already know volatility in the share market is influenced greatly by market sediment, national and global economic factors and media, whereas the property market is influence mostly by local sediment and supply and demand.

Property investments vs share investments…shares are easily liquidated, property can be slow to liquidate. Tax deductions are treated similarly in Australia as both are considered investments.

Property investments make use of tax benefits and depreciation or  tax deductible advantages, which are available on new buildings such as capital work deductions and any costs associated with property. These deductions are not directly available to share holders.

Depreciation is ‘on-paper’ loss in value of the building over time. The Australian Tax Office allows you to claim depreciation as a tax deduction, which can save you thousands of dollars every year.

The only problem is depreciation tapers off as the years go by so the newer the property is, the greater depreciation claim will be…

Property investments vs share investments…both investments can be negatively geared, however the biggest difference is investors ability to change and add value to their investment.

Share investments means an investor has little control over the running of the company, whereas in property the owner/investor can add value and improve the investment.

Why is it better to create a balanced port folio of both shares and property? Firstly you need to carefully consider what you want from your investment before you decide where you invest your money.

If you understand the idea of adding value and how to influence your better lifestyle, you want to put yourself in a much stronger position to improve the value of property investments…

Property Investments 

Why You Want Investment Advantages?

What Are Your Investment Advantages?

As an investor, you want investment advantages because how do you manage your own investment portfolio and take advantage of unique tax benefits?

Property investment success, in all it’s shapes and sizes, whatever it means to you…is all about preparation, focus, determination and action with mitigated risk taking…

Being focused in property requires a solid business plan. You need to be prepared and organised to know where you’re going. This is why you’re setting your goals clearly in writing, right?

This is where preparation meets motivation…once you put your pen to paper and start visualising and framing the end results in mind, it has far more graphic impact and motivation in achieving your goals.

Thinking about what you want to do and why you want to do it, is the first step in understanding your motivation to do you want to do…are you wanting to buy-and-hold or flip houses? If you prefer quick flips, ask yourself why?

investment advantages
Time to invest…that’s why you want clearly defined investment advantages

You want to know what property type and market to invest in, as well as the price range as this sets the frame work or structure in a firm business model:

1. Preparation and thoroughness means doing your due diligence, which means you’re not making any emotional decisions or taking on commitments unless you know and understand the results of the research you have done.

Next step is speaking to three real estate agents to get a sense of the market and whether property you’re interested is a good deal and stacks up in terms of research you’ve done via property research institutions…

You want a well structured, defined, yet flexible investment strategy. Why? Because if you too get rigid in your way of thinking, you could miss the target, even though all of the peripheral indices and factors tell you to rethink the road they’re going down…so you want to be flexible and open minded.

Prudence means protecting your investments via risk management, and this strategy includes using the experience of a street smart and successful real estate agent, property inspector, lawyer and tax accountant as part of your team.

Many investors try to go it alone don’t know how to handle the market ahead of them and fall into a series of unexpected problems. The right team supporting you can save you time, money and your peace of mind.

Determination means more than staying motivated in tough times because you want to know and understand the bigger picture in mind. You see, the reason why a lot of people make emotional decisions when it comes to real estate is because they’re not serious in treating investments as a business.

More often than not, they’re inexperienced investors or just naïve in seeing real estate in a very simplistic short-term perspective, so they’re not clear about the end results and time frames.

They’re often affected by all of the negativity and fear mongering out there. If you look at the bigger picture, you’re not going to make short-term, impulsive decisions.

You want to use your investment advantages because you understand and apply the fundamentals, which means you’re not reinventing the wheel that many successful investors already use to make millions of dollars in real estate, right?

Investment Advantages