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If you own a rental property, sometimes the simplest changes can make a big difference to your return. Consider some of these cost-effective tips to create happy tenants and more rental return for you.
Allowing pets
New Zealanders may have some of the highest rates of pet ownership in the world, but animal lovers can often face a difficult time finding rental properties that allow pets. Due to the limited number of rentals available to them, pet owners tend to stay longer in properties (reducing vacancies and turnover costs) and may accept a higher rent.
Adding fencing or ensuring that current fencing is secure, and putting in a cat or dog door can help to make a property pet-friendly. Establishing a pet agreement up-front (i.e. a higher bond to cover expenses, what the expectations are for avoiding pet-related damages to the property) can help both parties have peace of mind.
Make the property family-friendly
Among the different types of tenants, families are usually more likely to stay in a property long-term due to schooling and prioritising stability for the children. Happy, long-term tenants reduce turnover costs for you and creates a consistent stream of income.
A warm, dry home is a priority for families, so investing in features such as insulation and heat pumps can help to make your property more desirable for families, as well as a low-maintenance, fenced outdoor area for children to play in.
Furnish the space
It may not suit everyone or every property situation, but a furnished home can be desirable to certain groups of tenants – students, divorced people, short-term renters or those new to the country. These types of tenants may be willing to pay more for the convenience of moving straight into a furnished place.
Fitting out your property with simple, functional and stylish pieces can net you additional rental income per week. Essential items include bed/s, whiteware, TV, couch, dining table and chairs. Furnish the property in a modern, contemporary manner that will appeal to a broad range of tenants – not necessarily your own personal tastes.
Interior and exterior improvements
Invest in fans in the bathroom and kitchen, and a dehumidifier to reduce the likelihood of mould and create a drier, healthier home. Keep up with property maintenance to avoid costlier repairs later on. Don’t forget that minor additions such as a dishwasher or more storage solutions can also help to make your place more desirable for tenants.
Sprucing up the exterior of the property and outdoor areas can increase value in your property. An attractive and low-maintenance garden can provide more living spaces for tenants, and something as simple as repainting the front door a brighter colour can make a big visual impact.
Money matters
When it comes to property investment, it is recommended you review your finances from time to time. Refinancing at a better mortgage rate could help achieve a higher return. You may also want to contact your accountant or tax specialist to see if you qualify for any or further tax benefits.
It is also good to keep up to date with rental trends in your area to ensure that your rent is at market rates. A rental review every six to twelve months can be beneficial in receiving the maximum amount of return on your property, although it is important to remember that happy, long-term tenants can be a fair trade-off to higher weekly rents with more turnover.
Barfoot & Thompson was a Sponsor of the Sixth Annual Indian Newslink Sir Anand Satyanand Lecture held on Monday, July 25, 2016 at Pullman Hotel, Auckland.
