Investing in property can bring many rewards for your financial goals when managed effectively. Depending on your plans, investing in one or many properties could be part of your strategy to build your investment portfolio.
There are various market factors to consider when you are building your portfolio including current conditions relating to property prices, rental yield, and interest rates in addition to ongoing property costs that come with renting a property to a tenant.
Speak with your advisor
Before beginning your building on your portfolio, it is wise to sit down with your financial advisor and discuss a strategy that will best fit your needs and what you are trying to achieve.
You may discuss the reasoning behind building a property portfolio including wealth creation for retirement, you may be looking to renovate and resell at a profit or investing for a shorter term.
Whatever strategy you choose, a financial advisor can assist you in making an informed decision before making large investments in the property market.
Employ a qualified property manager
If you are to invest wisely, it is important to employ a qualified property manager who will look after your investment including placing tenants in the property, handling changeovers of tenancies, ongoing repairs and maintenance and ensuring rent is collected and bills are paid.
A great property manager will also inspect your property and provide advice on maintenance that may need to occur, potential rent increases in line with market conditions and capital works that you may need to plan for to ensure that the property is maintained and stays competitive in the rental market.
Maintain the property
When you are talking with your financial advisors and property managers, it is imperative to build a buffer of funds to maintain the property. Over time things will break with use, as they will in your own home and wear and tear occurs to the property over time.
Ensuring that you have funds available for expenses relating to the upkeep of the property will save potential stress when you need to carry out repairs or maintenance to the home.
Maintaining the property throughout the tenancy also means that when you sell in the future, you are less likely to have costs associated with bringing the property to market and may achieve more at sale.
Don’t forget tax depreciation
There are many items that can be claimed at tax time, including repairs, and your accountant can work with you on how to make savings and maximise your investment.
Arranging a tax depreciation schedule of the property is also a great way to analyse other areas that could be claimed at tax time for depreciable items over the property. Don’t forget if you are renovating, there may be items that can be claimed with scrapping.
Check-in with your advisors
At least yearly, check in with your trusted advisors in finance, accounting, and your property manager to ensure that you are getting the most out of your investment and they can guide you on the next steps to investing in property and building that portfolio.
If you would like to know more about how our property management team can help with arranging tax depreciation, managing your investment or finding out how much your property is worth, contact us today.