There are many options for property investors to increase their rental yields on their investment property that are relatively cheap and straight forward. As investors we are always looking for both maximum capital growth and rental returns.
So what are some tips to maximise the rental yields from your investment property?
1. Presentation, Presentation, Presentation
With the market in many areas being tight with low vacancy rates, potential tenants are quick to make decisions. Having an immaculately presented property will create a great first impression and provide you the best opportunity to attract the right tenants with the best returns. Ensure the garden is clean and tidy, the lawns mowed, and have any larger trees and bushes trimmed. Inside the property, make sure you remove any unnecessary furniture and ensure it has been thoroughly cleaned.
2. Market Rental Price
At the end of a tenancy don’t assume your rent can be increased by $5 or $10 but rather have a fresh appraisal completed to see if you can gain a higher return per week on your investment.
3. Management Fees
Ensure you are receiving competitive management fees from your property manager. Whilst it is important to ensure you have the right property manager on your real estate investment team it is a competitive environment and you may have the ability to negotiate a better rate. It’s worth asking the question, remember the property manager wants your business as much as you need there’s.
4. Set the term of your lease in line with the current market environment and your investing goals
Depending on the market conditions in the area you hold your investment property will determine the term of the lease you want to have in place. For example, in an over supplied area the rent for your property may be lower than a similar property in an area with higher demand. If a stable rental return is your goal, you may wish to accept a slightly lower yield with a longer lease for peace of mind. On the other hand, if your property is in a high demand area where rents are increasing rapidly, you may wish to take on a shorter term lease i.e. 6 months in which would offer the advantage of raising rents faster.
5. Having the right property manager on your team
As a landlord you have the option of managing your property yourself or finding a property management company to do it for you. When it comes to maximising your returns, a property manager may play a vital role in your real estate investment team as they will find, screen and select tenants, help ensure your property achieves the highest return, reduce vacancies, organise any maintenance required on your property, handle any complaints or issues and much more. Ensure you have an experienced property manager working for you to ensure you are the management of your property is in good hands.
6. Consider simple and effective improvements
Consider improving the appeal of your property through some light cosmetic renovations. Painting your property or the laying of new carpet are two examples of how you could increase the appeal of your property and therefore achieve a higher yield.
By following some of the simple tips outlined here you will ensure you are getting the maximum return from your investment property.