True Property Management Melbourne

Have you Accidentally Discriminated against your Tenants?

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Wed, 16 Oct 2013 11:03:00 +1100

When rent out your property, you want the right tenants. You want great tenants, ones who will look after your property as if it were their own, and pay the rent on time. Figuring out who those perfect tenants are can be a bit tricky, as you cannot chose tenants based on personally characteristics, and can only look at an applicants history.

In Victoria it is against the law to discriminate on areas such as: (Taken from Consumer Affairs Victoria )

age
carer status, family responsibilities, parental status
disability (including physical, sensory and intellectual disability, work related injury, medical conditions, mental, psychological and learning disabilities)
employment activity
gender identity, lawful sexual activity, sexual orientation
industrial activity
marital status
physical features
political belief or activity
pregnancy, breastfeeding
race (including colour, nationality, ethnicity and ethnic origin)
religious belief or activity
sex
personal association with someone who has, or is assumed to have, one of these personal characteristics.

Children

Some landlords like to have children (under age 16) in their property - parents tend to be stable tenants and don't like to move frequently. Whereas, some landlords aren't happy about having children in the property. However, be aware that you cannot refuse children in your property, unless:

property is the landlord’s main residence
property’s location and design make it unsuitable for occupation by a child.

So you can see how it can be easy to accidentally discriminate if you are not fully versed in discrimination law. Have you been close to making a mistake when it comes to choosing tenants?

Some Pro Tips for Property Investing

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Mon, 14 Oct 2013 04:47:00 +1100

You would've heard these time and time again, and the reason you hear them frequently is because they remain true, which means you can never hear them enough.

So get your team in order, your finances in order and your head in order and then lets have a look at this list.

Choose a property that tenants will like

It's not about you, it's about them. It's about what tenants find attractive. What's attractive? Close to amenities, good sized bedrooms, clean, light-filled, not too close to a main road, off-street parking, safe neighborhood. Get as many of these as possible in a property and you will be able to attract lots of good tenants.

How will it grow?

Choose a property that will grow in value, by choosing a property in a good location. As above, tenants want amenities so near schools, restaurants, public transport and the CBD are good choices. Properties close to these, are likely to grow in value in a good market and hold their own in a down market.

What can you do to Improve it?

Now you have your property, give it a quick spruce up to instantly improve the value of your property. Landscaping, painting, installing new curtains and flooring, change out hardware and cupboard doors, spend some time on the property and you will hopefully be financially rewarded (if you've chosen well that is).

Your Emergency Fund

If you haven't got an emergency fund, then you need to get on it - PRONTO! What you can do, when your property grows in value you can refinance it, so you have a little wiggle room if things go south in the other areas of you rife.

Make Em Long-term

Keep your tenants happy. That way they (hopefully) will turn into long-term tenants, which means more money and less stress for you. A good way to do that is to hire a property manager as they are experienced in vetting the good tenants.

So would you agree with the list? Is there anything missing that you think is vital to property investing?

Do You Know What Makes a Good Investment Property?

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Thu, 10 Oct 2013 07:30:00 +1100

Investing in property is much different from home buying. It is all about the numbers and has nothing to do with emotions. Choosing a good property means you have to think logically and long-term, with perspectives of future developments in the area or location of choice.

Here are some hints to help you determine if you are choosing a property that makes for a good investment:

The property caters to an existing market. When there is no need to create demand for a property, because there is one place, this is a good sign. An academic community with a nearby university or colleges is good for acquiring investments such as units or apartments suitable for students or faculty staff. There is already a demographic profile of people that you can take advantage of when deciding on which properties to buy.
A good property to invest in is one that is set to be “up and coming” – meaning it promises to be a booming metropolis or progressive place in the future. This way, you can acquire properties at a cheaper price, while benefiting from it in the future. Increases in the property or rental price along with the continuous development of the place make a great opportunity. You can ask the help of your reliable buyers agent for this. This is probably the key when buying at a good price, but is also the trickiest, especially if the area hasn't started the gentrification process.
Think about your target tenants. If you wish your property to maximize profits, it has to be tenant-friendly. Look for a place where people will find roads to the metropolis or city accessible. Proximity to commercial establishments, schools, and health care should also be considered. A 50km to 100km radius within the metropolis is good indication of a worthwhile property investment.

In these changing economic times, good property investment is needed than ever. Take a careful look at properties that are promising enough to bring you much dough. Seeking the help of experienced property manager with a proven track record is essential.

Steps to Take When Your Tenants have a Violent Situation.

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Mon, 7 Oct 2013 07:30:00 +1100

This is definitely something you hope to avoid as landlord or property manager, but unfortunately it does happen. This is why it is wise to have a general idea on how to handle a situation like this. A situation, that is far too important to ignore.

If your tenant is involved with a family violence situation there is in fact a set of steps you can help your tenant to follow.

If your tenant has confided in you that there is an issue, encourage them to work with your state's law. This information is for Victoria, so be sure you know what is required in your state. I would advise that in any situation like this, you get legal counsel so you can understand the ramifications of any decisions you make. Out of the goodness of your heart you may think that changing the lease without legal intervention is the right way to go, but it depends on the case, and you never know, by jumping the gun you may do more harm than good. So again, seek out legal counsel first and foremost.

For this discussion we are going to assume that if changing the lease quickly was the right thing to do, you would. But so you don't get yourself in hot water, here are the actual steps your tenant needs to follow.

This is what is required of the tenant:

The tenant/victim needs to apply to the Victorian Civil and Administrative Tribunal (VCAT) to have their tenancy arrangements changed.
This can be done only after a family violence intervention order is finalized by a magistrate.
The protected person(s) (i.e. your tenant) can apply to VCAT to end the lease early or arrange for a new tenancy agreement even if their names are not on the existing lease.
VCAT will determine who is entitled to any bond or who is responsible for any damage.

The Landlord in this situation:

Has the right to have a new 'Condition Report' provided on the property and also be given entry to the property to view the condition of the property (after property notice has been given).

As you can see VCAT is where the power is in this situation, and without it your tenant may create more problems for themselves.

For further information on this please see Consumer Affairs Victoria.

Have you ever had to deal with this before? What was your first step?

Is buying a home and buying an investment property the same?

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Thu, 3 Oct 2013 07:30:00 +1000

No, buying a house for you and buying an investment property are two different purchases.

You may be buying property in both cases, but the motivation for doing so are quite different. One, you a buying with your heart and the other you are buying with the calculator.

When you are buying your own home, you have a personal wish list that you want to achieve - or as close as you can. Maybe you want to live in a certain area, with a minimum number of bedrooms and space with all of this coming within budget.

With an investment property, all that matters is finding a property that is in demand that will increase in value overtime. So it doesn't matter what you personally think of the property, it's about how easy it would be to rent out, how easy it is to maintain and how much it will increase in value over time. So who cares if it's got 3 bedrooms instead of 4 and there isn't much of a backyard, because the rental yield looks fantastic, and the value of the property is on the up and up.

So make sure that when you are looking at property that you have the right 'hat' on. Ask yourself a few questions:

Is this property purchase about my financial future or is it about my day-to-day life?
What do I want this property to do for me in the long-term?
Am I going to live here?

An investment property will take extra work to find. The best ones are usually in popular suburbs, are close to amenities such as transport, schools, restaurants, employment and parks. Which means competition to find these properties will be fierce. So making sure you have a reliable team on your side helping with those purchases will do two things:

1 Allow you to pounce on the deals as fast as possible.

2 Keep your heart out of it, and make sure it comes down to the numbers only.

So no, buying an investment property is quite different than buying your own residence. You need to approach it differently and always keep in mind, it's not about you, it's about other people who will be living in it.

Yes, you need to keep on top of maintenance!

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Mon, 30 Sep 2013 07:30:00 +1000

There's a reason it's called maintenance, it means you have to be constantly checking on things to make sure your rental property stays in tip top condition.

Tenants are legally entitled to a safe and habitable property, but it also makes good business sense - if it's not kept in good repair then your tenants will be few and far between and you will be losing money.

So lets have a look at maintenance.

The Tenant's View

Make sure you keep in mind that other people are going to be living here and you want them to be safe and happy. Happy usually means they will turn into long-term tenants and that's what you want. So look at it from their perspective. What would put someone off? Is the gate hanging on it's hinges? Is the paint peeling? Are there dripping taps? These things don't take too much money to fix, but they have a big impact on what the place looks like and how your tenants feel about the place.

The Ongoing

When you don't perform regular maintenance and repairs, a few things start happening.

The problems get bigger and take more money and time to fix.
The value of the property is more than likely to decrease
The time between tenants will be longer and longer

What does that all mean? It means less money in your pocket.

When you touch up paint, update fixtures and appliances it shows you are invested in the property and potential tenants will appreciate this. Tenants are also more likely to take care of a property that is already in good shape. If a single broken window can cause a neighborhood to deteriorate, then a what could a single broken window do to your property and your tenants?

When a tenant says there is a problem, it behooves you to investigate. Most tenants are not in the habit of calling their landlord 'just because', they prefer to live without the landlord breathing down their neck. So when a tenant calls, then it's (most likely) for a good reason.

Foresight

To minimize those calls you can in fact think ahead as to the type of issues may come up. A swimming pool is asking for a lot of work, as well as a large grassy areas and appliances such as a waste disposal. So think about your property and think about any changes that you could make that may mean you'll save yourself time and money in the long run.

What activities do you do to ensure your investment property stays in tip top shape?

DIY Property Manager Traps

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Thu, 26 Sep 2013 07:35:00 +1000

You've decided to forgo the use of a Property Manager in favor of managing your property on your own. Now you need to brush up on your skills so that you don't fall into some of many potential traps out there.

Most DIY property managers assume the hardest part will be dealing with the day-today side of things: Tenants not paying rent. Phone calls in the middle of the night. Not abiding by the rules etc. Yes, they can be frustrating, but I would argue, however, that the toughest part for any DIY Property Manager is the legal side of things. If you are not 100% up to speed on tenancy legislation and the paperwork required, you may find yourself in some unwanted hot water.

There are lots of areas to look out for, but here are a few common problems that may arise with new DIY Property Managers.

No Lease
A handshake and a promise is not legally binding. You need to have a legally binding contract that outlines your tenants responsibilities. The very minimum that it should cover is the length of the lease, the rent to be paid (and when) and the condition the property is currently in and what it should be returned to upon vacating.

No Condition Report
A condition report needs to be filled in on a regular basis. It is designed to make sure both parties are protected. But it is pretty useless having one, if it is not filled out and approved by both parties.

The Bond
Not asking for a bond or not handing the bond correctly can set you up for heartache down the line. Asking for a bond and putting it in your bank account is big non-no. Along with not asking for a bond at all. What will you do if your tenant damages your property and you have no bond to correct the damage?

Tenancy Law
How much do you understand about tenancy law in your area? Not understanding tenancy legislation is not a valid defense, so if you may be fined if you don't comply with all the rules and regulations. So make sure you understand the law in detail, or you have some help here.

Entering the Property
Even though you own the property your tenants live there and they have the right to be left alone and not have you breathing down their neck. You must give notice before entering the property either for a property inspection or if you are working on the property. Make sure you are aware of how much notice to give.

So are you ready to be a DIY Property Manager? It is a lot more involved than most people think, and there are a lot of pitfalls for the unsuspecting.

Have you tried to be a DIY property manager? how did it work out for you?

A Successful Rental Open Home vs a Failure

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Mon, 23 Sep 2013 07:30:00 +1000

So you have your rental property ready to go and now you need to show it. You've advertised that it is open for viewing on a certain day and time and now you need tenants. What can you do to make sure it's a success and not a failure?

Preparation
Just like a good Boy Scout (or Girl Guide), you need to be prepared. Make sure you are confident with your property and the open home will go a lot smoother.

Are you on time? (That means being there at least 30 mins before the scheduled open time). You can guarantee that people will show up early if the property is in the right location and ticks lots of boxes. So be there before everyone else. Maybe even get there an hour before, just to be safe.
Do you have all the forms you need? Telling prospective tenants to 'go online and download the forms' may put off that perfect tenant. Have multiple application forms on hand, and more than you think you may need. Bringing one set is not going to cut it.
Lets step back a bit and look around the property. Have you prepared it properly? Are you sure it's 'move-in' ready? You will put off a lot of potentials if the carpet is rolled up along the wall and paint cans lying around. It doesn't matter if you say "I promise that the carpet will be in and the place repainted before you move in." Tenants will not be able to see past that.
Is the outside looking good, garden tidy and the lawns mowed?
Is everything working inside? Light switches all functioning, no missing lightbulbs? No leaking taps or broken tiles? Smoke alarms are working with new batteries.
You want to avoid receiving 15 phone calls straight after the tenants have moved in asking to come and look at this and take. It will save you time and money in long run by making sure everything is in working order.
Can you answer all the questions?: How much is rent? When is rent due? What is the length of the lease? What is the neighbourhood like? What is the crime rate in the area? What additional expenses are there? What is the policy on pets? When is rubbish collected? What is your decorating policy? Why did the last tenant move out? What ongoing issues are there with the property?

See, all it takes is knowing your property inside and out, getting it to a 'move-in' ready state and being prepared with paperwork and answers and you will have a great showing. Alternatively of course, you can employ a property manager to take care of all these things for you. But it is still wise to be involved in this process. Remember that investing in property doesn't mean that you set it and walk away.

The DO NOT INSTALL List for your Investment property

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Thu, 19 Sep 2013 09:54:00 +1000

You have a rental property and you want to make it as attractive to tenants as possible, but there are certain amenities that if you do install, will only create headaches for you. By headaches I mean, they will suck up money on maintenance and time to get them fixed. Anything that is likely to break, will break at some point, so you need to strike a balance between adding a feature that will attract tenants, and a feature that will cause you headaches.

So what are they?

A Pool

Why on earth would you want to install a pool, unless of course the tenant is responsible for all care and maintenance? You do not want to be responsible for cleaning filters and green pools and broken pumps. This is also does not take into consideration laws around fencing and pools. Pools also includes spa pools too. Lots of headaches here.

Waste disposal

How many times do you want to be called out because of the tenant shoving eggshells down the waste disposal and jamming it? Yes there are good quality waste disposals units around, but a fork being munched in the unit will adversely affect it forever. So avoid it.

Bidet

Anything over and above the basic bath/shower/toilet and vanity is probably asking for extra work. You could consider installing a heated towel rail to add an extra touch, but again, anything that may break will break, so just be prepared.

Water Filter

This is not the end of the world if you do install one in you property. For it to be worth it your tenant it will need to have the filters changed regularly. If that is not such a big deal, and you don't mind the odd call out for a dripping tap, then maybe it is a nice feature for your tenant.

Appliances

Washing machines, dryers fridges and freezers etc. It's not common for these to be included in rentals in Australia and that's a good thing, the more a tenant can be responsible for the better.

Features that may break but really are worth it:

Heating/Cooling

Heat pump or some kind of built in heating/cooling device is a good thing, especially in a market like Melbourne. The summers can get very hot and with winters cold, tenants are looking for ways to make their life more comfortable.

Dishwasher

Yes they break, but tenants will look for this, or at the very least a space where they can install their own if you are wary of including one. Modern day living means modern day features, and dishwashers are more and more a 'necessity'.

Alarm

I'm on the fence about this one. I think it often depends on the area that the property is in. If all surrounding properties have one then it would behoove you to install one too. They don't need to be hard-wired to a security company and can act like more of a deterrent to untoward activity. It does show your tenants that you care about their safety and that of the property, but like with anything, there is maintenance involved and they can be tripped by insects or heat.

Solar Water

This is a tough one, because the environmental benefits are wonderful, the appeal to a tenant is huge, the value you may or may not add is debatable and the amount of maintenance can be high. I guess if your property is in a very competitive area, this maybe what you need to include. A vegetable garden and solar heating would definitely set you apart.

So did I miss anything on the list? What would you not install in your rental property?

Make Improvements to your Rental Property - on a Tight Budget

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Mon, 16 Sep 2013 07:30:00 +1000

So you have a rental property but a very tight budget to make improvements on it.You know you need to add value to maximise returns on your rental, but what can you do?

The good news is you can keep your rental in good condition and add value without breaking the bank. By making upgrades and renovations wisely, you will not eat into your maintenance budget and you can still come out on top. So where to start?

New Paint:

The fastest way to make something look fresh, new and clean is paint. So look at the outside and see either a power wash or a paint is in order. If it's been more than 5 years since it's been painted, then paint may be the best option. On the inside, just paint it. Don't bother about trying to clean it off, just put on a fresh coat of paint.

There is a catch with a new coat of paint - it has to look professional. A slap dash approach to painting will make it look worse. If you don't prepare the surfaces properly and then don't clean up the spills and splashes, you make the place look worse, rather than better. So if your painting skills aren't all the best, then call in the professionals.

Make sure you paint in a neutral color to maximize your tenant base. read more about that here.

Landscaping:

Sometimes you don't even need to spend money on the landscaping, you just have to put the time in, so this is a good place to save money on a tight budget. Mow the lawns, give it a really good weed. You can even transplant some plants from one area of the house to another, to make it look fresh. Ask around to see if people are getting rid of plants and plant those - if appropriate. There are usually lots of plants for sale at your school fair and garage sales. You don't have to spend money at the nursery.

Inside:

A good bang for your buck here is changing out window treatments, cupboard doors, hardware and giving the floors a good clean. If the carpet is from the 70's, change it. You can't get around that one I'm afraid. So put in something hardy and neutral and you will reap the benefits.

Clean, Clean Clean:

Make the place sparkle. Windows, walls, ceilings, in every crease and crevice. Clean, clean clean! This is a good opportunity to find anything that needs fixing.

You do not need to spend thousands and thousands on your rental. Put what you can into the place without going over your budget, as time and money allows ,you can improve the property. A lot of landlords go out with guns blazing and have grand plans to overhaul their properties, only to find out that they have overspent. Take your time, if you have chosen wisely the property can wait for the big bathroom and kitchen renovation.

What are you favorite initial upgrades you do to your rental properties?

What could you buy for $300k?

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Thu, 12 Sep 2013 06:48:00 +1000

So you have $300,000 and you want to invest in property. What solid properties are available in some popular places across Australia?

Here are some options:

Lakelands (Perth/Mandurah) WA

For Sale $298,734

This is a 3 Bed, 2 bath property, garaging for 2 cars. It is 'on the doorstep' for activities such as fishing, cafes and restaurants.

Melbourne VIC

For Sale $299,000

This is in the heart of Fitzroy and features 2 bed, 2 bath and a parking space. This would appeal to many investors.

Adelaide SA

For Sale $280,000 to $290,000

The carrot with this property is that the current owner will pay the Stamp Duty. This is another 2 bed, 2 bath property, but no parking space included. This property is in the heart of the CBD

Hobart (TAS)

For Sale $275,000+

This would be a renovators dream, since it hasn't been looked after in the past 20 years! But if you're inspired by a blank canvas, this 4 bed, 1 bath property may just tick the boxes.

Sydney NSW

For Sale $265,000

A serviced apartment with a net return of over 6%. This is a luxury furnished studio apartment.

So this is what $300,000 will buy you at the moment, are any of these properties appealing?

What utilities are you responsible for?

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Mon, 9 Sep 2013 07:30:00 +1000

As a landlord you know you know you have to pay taxes, the mortgage, maintenance costs, fees to any of your team members that you may use on a regular basis (like a property manager for example) But what about utilities, can't you just make your tenant pay for everything?

Well in a way they are through the rent that they pay, but this comes directly from the Consumer Affairs Victoria website. Which spells out exactly what tenants and Landlords are responsible for

Water

If the property has its own meter, the tenant must:

pay for water consumption, and
(in the Melbourne metropolitan area) sewage disposal, unless the landlord has agreed to pay these charges.

The landlord must pay all other charges related to water supply, although different rules may apply when a tank is the main source.

Other utilities

The landlord must pay all installation and initial connection costs for electricity, gas and oil supply. If there is a separate meter, the tenant must pay for all other charges, unless otherwise agreed. If there is no separate meter, the landlord must pay.
Where bottled gas is provided, the landlord pays for the supply or hire of bottles and the tenant pays for the gas. A landlord must reimburse the tenant for the costs of any utilities for which the landlord is liable.
The landlord must reimburse the tenant for any rates or taxes paid to a public authority that are not part of consumption charges for the service. However, the tenant may be responsible for these costs if their lease is for a fixed period of more than one year and the lease agreement states this.
Director of Housing tenants may be charged separately for expenses such as heating and laundry.
Tenants are responsible for phone line and internet connections, unless the lease states that the landlord will provide these services.
If an external antenna is part of the property and cannot receive digital signals, the landlord must upgrade or replace it if the:

original antenna could receive analog signals when the tenant moved in, and
lease is covered by the Residential Tenancies Act 1997.

For information about who is responsible for smart meters, visit the Department of Primary Industries website.

Have you been in a situation where you didn't know who was responsible for what? How did you handle it? If you use a Property Manager, they will ensure that you and your tenant know who is responsible!

Source: www.consumer.vic.gov.au

House vs Apartment: Which investment is right for you?

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Thu, 5 Sep 2013 07:30:00 +1000

One question that comes up more than any other is, “Wouldn’t a house with a backyard make a better property investment than a one bedroom apartment?” The answer is the most frustrating of all - “it depends”! It depends on the property, it depends on your budget, it depends on the location, and it also depends on your investment strategy.

Choosing a House for your Investment

Houses have better potential for growth. Land will always appreciate and there is more land attached to houses than apartments. Land is also in short supply. In following the principal of supply and demand this means that good growth is to be expected.
Greater capacity for development. It is possible to increase the market value of a house through decorating, landscaping, extensions and remodelling. The same scope for improvement is not present in an apartment.
Potential to sub-divide, cross lease or sell well located property as land becomes more sought after.
No body corporate fees.
No restrictions (in many cases) placed on fencing, external colour schemes and pets.

Choosing an Apartment for your Investment

Cheaper maintenance costs than the upkeep of a rental home.
Easy to rent with the draw of inner city living, transport efficiencies, easy care lifestyle.
No gardens to upkeep.
Less investment capital required when compared to a house.
Purchasing a parking space along with the apartment can be used as secondary investment - lease out separately, or in addition to the apartment

What is your preference when it comes to investing? Are you more inclined to buy houses or apartments?

7 Investment Property Calculators

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Mon, 2 Sep 2013 07:20:00 +1000

So you are considering buying an investment property - good choice! It can feel overwhelming with all the numbers to keep in mind - Do I have enough money? How much money will I make? How much rent to charge? There are a lot of free calculators online that will help you give you an idea of the numbers. I would recommend if this is your first time out, that you develop your team who will be able to give you full and complete advice on what to do.

But here is a collection of various calculators that might help you decide on taking that first step.

Have you used an online calculator before? Did it help you with any decisions you had to make?

Who do you have on your team?

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Thu, 29 Aug 2013 07:30:00 +1000

If you are going to be a successful property investor it's best to have a solid team that you trust. Make sure you get recommendations from family and friends. You're looking for team members who are successful investors themselves. Also keep in mind the best way to see if they would be a good part of your team, is to see how well they have done for others.

Once you have a list of people go and talk to them and see if they fit with you. Find out how your investing strategy fits with their philosophy.

But who is it you should have on your team?

The Money

You need to know how much you have to spend and your Finance Broker is just the person to sort you out. There's no point looking for deals if you can't buy them straight away. The best deals are not going to sit around and wait while you go from bank to bank to finance a deal. Your Broker on the other hand, can almost create miracles and allow you to get those great deals.

The Agent

Your Buyers Agent can find you the deals that you wouldn't normally have access to. You do have to pay them to find you the best deals, but it works out to be a win/win for everyone.

The Legal

You need someone to be able to read the contracts, know what they mean and be able to interpret them for you. Be aware that there are differences from state to state, so you need to have your Solicitor to be aware of those nuances. When it's in writing it's binding, so you want to make sure you know what you're signing.

The Numbers

Your investing needs to be structured in such a way that you are protected, that you are paying the right amount of tax, and you are getting the most out of your investment. If you get this wrong you will pay dearly. Make sure they know your strategy and they will help structure things in the right way.

Insurance

You need insurance and this is often overlooked. Most don't consider it to be of vital importance until after the purchase has been made and tenants are in the door. Make sure you get Landlord insurance ASAP - as soon as the deal has gone unconditional. That way you will have peace of mind and it covers pretty much every eventuality.

The Manager

How could I give you a its of people on your team if I don't talk about a Property Manager? We take away the day to day frustrations, and ensure your property stays in tip top condition (among other things). Make sure you know how your property management company is structured - who exactly will be managing your property. This is a big asset of yours and you want it to be looked after with tender loving care.

So do you think I missed someone from the team that I haven't included? If you would like some help in tracking down some team members, get in touch.

4 Things Great Tenants Hate

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Mon, 26 Aug 2013 07:30:00 +1000

So you have a great tenant - that's fantastic, they are what all landlords hope for. They pay their rent on time, they look after your property and they are undemanding.

However, they can still get frustrated and want to move. Do you want to know what drives them over the edge? Here are a few areas that you control, that could drive them out. So take heed.

1 - Great tenants don't like being bugged.

They don't like it when neighbors (especially in an apartment complex) throw wild parties, they don't like drug dealers in the neighborhood and dealers' clients knocking on their door, and they don't like you showing up early Saturday morning wanting to get stuck into the garden.

Good tenants want to live undisturbed in a safe neighborhood. So if there is activity that is going on in the area that is annoying or unsavory, then work with the owners of the properties to sort it out.

As for you showing up 8am on a Saturday morning. Don't! Call your tenants first (at least 48 hours in advance) and work out a time that's good for both of you.

2 - Great tenants hate lack of follow-through.

You say you will be round to fix that leaking tap, but you don't. You say that you are 'planning on painting the property within the next 6 months', but you having even thought about paint colours - a year later. You say you will deal with the noisy neighbor, but the neighbor is still being noisy.

Your tenants, like everyone, don't like being lied to. Yes life gets in the way and you are busy and yes there isn't always money there, but at least keep your tenants updated. Let them know that 'sorry I was coming to fix the tap last week, but ended up in the hospital, I'm sending 'XYZ' around to get it sorted. Sorry.' Communicate with them if there is a problem, and really only promise something if you do intend to follow through. No, using the word "planning" doesn't get you off the hook, that implies that you are seriously considering it.

3 - Great tenants hate it when you're rude

Well that's a no-brainer, nobody likes rude people. It doesn't matter if you are having a bad day and you have problems of your own, your tenant is your customer and you have to treat them with kindness and respect. If things are really bad your end, you can explain that you have 'world war 3' starting at your place and you will call them back in an hour' - and do so. People understand that life happens, just don't take it out on your tenants.

4 - Great tenants hate being unappreciated.

Great tenants are great customers, they know it, you know it. So treat them as such. If the tenants went above and beyond, say thank you. If they have been in your property for a long time, what little upgrade can you provide that is a good way of saying 'we appreciate your business'? It's not difficult, think about what you would like if you were the tenant.

So as a landlord, what do you think tenants hate?

Neutral or Bold for your Rental?

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Thu, 22 Aug 2013 07:30:00 +1000

So you have a unique design style your home looks like it comes out of an architecture magazine. You have funky paint, reclaimed furniture and your light fittings are made from recycled baskets. Now you would love to put your 'flair' into your rental property, you are convinced it would stand out and people would line up at the gate, wanting to rent your property.

Good idea?

No, bad idea. Sorry.

You may love that style, but what about those people who like more of a french country look, or those who like a traditional home, or even the people who prefer a nautical theme? You've just knocked out all those people as potential tenants.

If you have bright red walls and your potential tenants have blue furniture, they are going to think long and hard before signing a lease.

As much as you may love a particular theme, it doesn't mean that potential tenants will too. It also may mean that you're going to have to carry out more maintenance than you anticipated or budgeted for. You may even see a higher turn over in tenants.

So the rule of thumb with a rental is keep it neutral. Go for gold on your home, but to maximize the interest of potential tenants in your rental property, neutral paint, neutral flooring, neutral fittings… neutral, neutral, neutral.

Do you agree, or have you had great success with a 'statement rental'?

The Bad Tenant - How to get rid of them.

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Mon, 19 Aug 2013 07:30:00 +1000

It's the nightmare of all Landlords, the Bad Tenant.

No one wants them, and you're probably kicking yourself that you may have been able avoid them, 'if only' you had done X,Y, Z. Well you can't go back in time, so the next step is to deal with them here and now.

But what do you do?

First of all it depends on what is happening? Not paying rent, being rude to the neighbors, destroying your property (pulling out water heaters, tearing up the floor, setting fires etc)

To figure things out, go talk to them. If their rent is late find out why. Is there a family crisis going on? Did they just get laid off? Or did their pay cycle change at work and it's creating cashflow problems? If your tenant has been in your property for sometime and you have never had a problem until now, talking to them and working something out, maybe a work out best for everyone.

But what if it's a bit more serious than rent being late a couple of times? What if they truly have destroyed the property? Still, go talk to them in person. Let them know that you have been forced to evict them, but you would be willing to waive the eviction if they could be out of your property by the end of the week (or alternate date) with all their belongings. This means that an eviction will not be on their record, remind them that an eviction will make life harder for them in the future. Before going ahead and offering this compromise, make sure you are legally able to do so. If you are in Victoria, read about how much notice you need to give here.

If they practically spit in your face over the is offer, and you are legally able to, then give them notice. Make sure you follow the rules to the letter. This is a good time to get advice from your lawyer to make sure it goes smoothly.

Just get it done. The worst thing you can do in this situation is drag the chain and hope that things will sort themselves out. They won't, and the sooner you can reclaim your property, fix it up and put the nightmare behind you, the better.

Don't be surprised however, if you get a few more nasty surprises as they are heading out the door. It's not uncommon for truly bad tenants to add even more damage to a property 'just because they can.' Take a deep breath and thank your lucky stars they have gone and you can learn from the episode.

In the future to avoid this heartbreak, make sure you go through all the steps of weeding out bad tenants. You can read how to do this here, here and here. Or you could employ the services of a property manager and they will take care of this for you.

Have you had to deal with this? What was your preferred method of getting rid of the tenant?

Managing your Property Manager

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Thu, 15 Aug 2013 12:12:00 +1000

You have an investment property, that's great, you also have a property manager to manage your property that's even better (check out this article why that's a great idea), but do you know how to get the most out of both?

Well if you want the most out of your investment property, then you really need to work well with your Property Manager, and the only way to do that is to participate.

You don't want to be under the feet of your property manager, otherwise your relationship will sour, but I'm not saying have a 'set-i-and-forget-it' attitude either.

What I'm talking about is being confident in your choice of property manager, but also don't just take their word for it. Make them work for their keep! (Me included.)

Here's a couple of ways to make sure your property manager is doing the best for your property.

Inspections

I wrote a little while ago about going with your property manager to house inspections read about why I suggest that here.

Oh Really?

Ask why. When your property manager suggests something, for example increasing the rent by $10 a week or installing new flooring. Ask why, and ask why that particular amount or that particular flooring. You want to see why they are making those decisions. It helps you understand your property and your property manager better.

Research

It's important to keep your hand in on the market. So it's a good idea to look at market conditions, vacancy rates, rents, rental yields etc. That way when your property manager suggests increasing the rent by $5 a week you will see if that's realistic option in the current market. Yes you want to get as much out of your investment property as possible, but that $5 may mean 1-2 months of no revenue at all.

Lots of Quotes

Your property manager will have their go-to crew when it comes to maintenance and repairs, but I would politely insist that they also invite at 1 or 2 outside sources to provide quotes. Quotes always vary, so knowing what the usual contractors would charge compared to others is a good idea. The property manager too may find a new contractor in the process.

Always keep in mind though, that your property manager is on YOUR team, they are YOUR employee and they want to do the best job for you. If they are NOT doing their job and balk at any of the above suggestions, you might want to consider switching. A great property manager is gold, pure and simple.

Water Heaters for your Investment Property

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Mon, 12 Aug 2013 07:30:00 +1000

Owning an investment property means you are looking at getting the most money out of it, rather than sinking money into it. Which is exactly how it should be. Getting the most out of it often revolves around your tenants and what they are looking for in a rental property. Tenants these days, are looking to be more fiscally and environmentally responsible. One of the ways to save money on a day to day basis is with hot water.

I'm sure you know that a traditional water heater runs all day and night keeping the hot water hot, which means it is using power whether you like it or not. That means more electricity used which is both a financial and and environmental drain. If the water heater in your rental property needs to be replaced, you may want to consider a a different option which can be a good selling point to potential tenants (especially if they have to pay their own utilities).

There are many options to consider when it comes to installing a new water heater. Here are a few that might interest you. The Government of South Australia has some great information about water heaters. But if you don't like in SA you better follow up in your area when it comes to rebates.

Tankless Water Heater

This is the most common 'alternative' to the traditional water heater. It only heats the water that you use. This makes far more sense than having a tank of water bubbling away that you may not use. It's like having a pot of water hot on the stove all day, just in case you may need it. A tankless water heater works by cold water entering at the bottom, where a gas heater rapidly heats the water to a near boil. When you turn off the water, the heater turns off. To increase efficiency even further, having the heater with close to the bathroom or kitchen will mean the hot water won't need to travel so far.

Electric Heatpump

This type of water heater is becoming more popular, based on the technology of a heat pump. The heat for the air is transferred to the water and is three times more efficient than a traditional water heater. In many places there are rebates available when installing a heat pump water heater, so look into it.

Solar Water Heater

This initially seems like the best option, no more paying for hot water! But there is set up and maintenance that needs to be considered. You also need a boosting system for days when there isn't enough sun to heat the water. So depending on where you live, this option would heat between 60-100% of your water.

Everyone is looking at using alternative energy sources, so having solar panels that are well maintained, on the roof of your rental could in fact help you attract a savvy long-term tenant.

The downside to the above options is the cost. They cost more to buy and install than a regular water heater, but it should pay for itself within 1-5 years. That is if you were paying the power bill yourself. Since your tenants are paying the power bill, then you need to consider A - if it's worth it (attracting new tenants, having a point of difference in the area etc) and B- How to recoup the costs involved? Is it about adding value to the property or can you include it as part of the rent?

If you are unsure as to the viability of installing an alternative to regular water heater, then get in touch with your property manager. They will be aware of the areas that it could be a good option.

Adding Value to Your Rental Property

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Thu, 8 Aug 2013 07:41:00 +1000

One of the best ways of making money from your investment property is adding value. By adding value you can (usually) increase your rental yield, as well as increasing the value of the property, so a win/win all round.

So what are some ways to increase value but won't break the bank? Well, in fact they are very similar to how to renovate your property post that we wrote about not long ago. But you have to keep in mind that there is not 'One List'. It depends on your city and suburb, what is normal for one area, may be pointless in another areas.

However, there are some things definitely worth considering.

Landscaping

An attractive yard, with a good fence can go a long way in attracting tenants. It broadens the appeal of who will be interested. A fully fenced property would work for a professional couple to a family. So it makes sense to add one if appropriate.

Kitchen and Bathrooms

As you know these rooms sell houses. Everyone, be it an owner-occupier or a renter demands a functional and attractive bathroom and kitchen. So if you can spend some time and effort in these rooms to bring these rooms to an 'above average' standard you are well on your way to attracting the right crowd.

Outdoor

We love our outdoors, so having a patio or deck that naturally flows from the inside is a great idea. It makes a house look much bigger when you have open homes during the warmer months and is easier for your prospective tenants to visualize themselves entertaining. Bi-fold, french or stacker doors can be an expensive addition, but may be the 'wow factor' that can make all the difference. So do your numbers.

Storage

The gripe of every renter is there is never enough storage. Help resolve this issue, from either including a garden shed, turning the carport into a garage or including thoughtful wardrobe storage. You can even get creative and turn space (if possible) under the stairs into a storage dream. Look for inspiration on websites like Pinterest to find endless ways to create storage.

Colours

Update the property. Rip down the 70's wallpaper and tear up the psychedelic carpet and replace with neutrals. As much as you may be tempted to include a feature wall, it will mean you will reduce the number of people interested in your property, since you never know if it will clash with their furniture.

So those are some key changes that you can make that should add value to your property. Do you agree on these, or would you suggest other options?

Finding Properties to Renovate

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Mon, 5 Aug 2013 07:26:00 +1000

Do you like to renovate?

There are some people who love to find properties that they can do up, add value to and rent out, or maybe even flip. But sometimes it can be a little tricky to find the right kid of properties to invest in. Especially if you head further and further out from the CBD. This is because you can often buy a new house and land for about the same price as decent house closer to the CBD.

So some things that will help you track down the right property to renovate.

Ownership

You're likely to find the good places in an area where there is an owner-occupier percentage of 20% or higher. Looking for these areas will give you options. If you decide after you have renovated the property, that you would rather sell than rent out, then you are likely to find a buyer in these established neighborhoods. If you decide to rent out your property - especially if the property is a good one for families - you will find that it will be easier to rent out too.

How long Has it Been on the Market?

Look for areas where the average house stays on the market for under 75 days. This will show you the the market is lively, the area is appealing and of course if you want to sell it, then you will feel better knowing that it won't stay around too long. On the other hand it also shows it's a desirable neighborhood to live in if you are going to rent it out.

Sales History

Look at the market trends and look at suburbs where there have been at least 100 properties sold over the past 12 months. Again this shows you how lively the area is. If only 1 or 2 have sold then yes competition will be low, but how many people want to move into the area? This will impact how easy it is to rent out, or how easy it it is to sell again.

So if you are looking for those great properties that you can renovate and rent out, then you need to do some homework. You need to get your head around the price of properties that are renovated, as well as un-renovated properties. Then you can make the call on which property would work for you.

The Art of Negotiating

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Thu, 1 Aug 2013 07:30:00 +1000

One of the keys to getting a property that is good value, is the art of negotiating. I bet you have come across a really good negotiator, one where they can get thousands and thousands off the price - of anything! From cars, houses, furniture, they see the price as a starting point rather than the end point. Here are a few trick they probably use.

When it comes to negotiating in property, there are a few key areas that can create a more favorable environment - for you.

You're not the only one.

You need to convince the vendor that their property isn't the only one you're interested in. They need to know that you are prepared to walk away - no vendor wants you to walk away, which may mean they will be more willing to make a deal.

Beware however, they may throw this back at you by saying "Well that's ok, as we have other interested buyers". So through your agent (and theirs) you need to get across the point that you have other - better - properties that you have your eye on. This shouldn't be lying, as you no doubt have found various properties that fit the bill.

The person who has more than one option, will be the person who has the most negotiation power.

Time is on your side.

A vendor who needs to sell, and needs to sell NOW will be more open to doing a deal. This is especially true if you've convinced them that there are other properties that you're interested in. Of course you won't always know their timeframe upfront, and the agents may or may not want to share this information, but you can get a general idea on how motivated they are by asking what other offers that may have received.

What do you know?

If you have done all your market research you will be in a strong position to offer a realistic price which is creates a good deal for you at the same time. While you are researching, see how much information you can about the vendor. You never know what you will find that could help you push the deal over the edge.

So what are your favorite negotiating techniques? Do you know someone who is a fantastic negotiator? How do they get the best deals?

Keep your Long-Term Tenants.

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Mon, 29 Jul 2013 07:30:00 +1000

Long-term tenants = long-term cash.

Now you have tenants in your property how do you keep them happy so that they will become long-term tenants?

The most effective way is by building a good relationship. It costs a lot of money whenever a tenant moves out so it would make sense to retain your tenant for as long as possible. It takes roughly 5-times as much to replace tenants, as it does to keep them, so put some effort into keeping your tenants happy.

Or think of it this way, if you have a tenant in your property for 10 years and they are paying you $2000 per month, that's $240,000 they have paid you! If they haven't paid off the property by themselves, then they have made a very large dent into the mortgage.

Respect their Needs.

If they have young children and the property isn't fenced, would it make sense to add a fence (investigate if this would add value to your property)? Or if you have a professional single woman in your property, adding security lights might be a nice touch. You don't have to go way above and beyond but if you are considering adding items to your property, then it might be wise to consult your tenants to see which they would prefer.

Maybe updated curtains, new light fixtures, or some help in the garden would be what the tenant would prefer. Make a list of what you are willing to do and let them choose.

Respect doesn't just mean you are doing improvements on the property. It means being aware of who they are. When you are scheduling a house inspection make sure you understand what would be convenient for THEM. If they have children at school, don't schedule an inspection during the winter school holidays. If they are professionals, then 10am on a Monday morning probably wouldn't be convenient.

Always keep in mind that this maybe your house, but it is your tenant's home. So act like a good Bartender!

Keep the property fresh. Winter is the miserable time of year and when mildew and mould turn a cosy house into something that looks less appealing and has your tenants considering other options. You might be surprised to find that tenants often will move because they think the property is dirty and unpleasant looking.

Consider once a year to help out with a bit of a 'spring clean' - attacking the garden, cleaning the mould and mildew and laundering the curtains. Cleaning these things can go a long way for good will. It also gives you the opportunity to get in there and perform any regular maintenance.

It really doesn't take too much to encourage long-term tenants. These things won't guarantee you will keep them - circumstances will change for your tenants. But by treating all tenants like potential long-term tenants, then you have a better shot of them actually turning into those long-term gems.

What do you do to try and encourage your tents to stay put?

When to buy property - for the first time.

anne@truepmvic.com.au (http://truepropertymanagement.blogspot.com/) — Thu, 25 Jul 2013 07:30:00 +1000

Which do you think is harder? Knowing HOW to begin a property portfolio? Or knowing WHEN to begin your portfolio?

I would say the latter, and it's becoming more and more difficult to start. Entering the investment market means you need money and you either get that by saving for a deposit and buying a house as you normally would. Or if you already have a home, leveraging the equity in the property as a deposit. To leverage your own property, then you need to have paid some or all of the original loan, or the property has to have increased in value.

Both of these options take time, especially if you are waiting for your owner-occupied property to be completely paid off before you begin investing. At which point you may jeopardize your portfolio's full potential.

So what do you do? It depends on your situation. Getting advice from a qualified and knowledgable property investment expert is the way to go.

If you are an owner-occupier, rather than waiting for the whole mortgage to be paid, leverage what you can and possibly buy in a regional areas where positively geared properties are more plentiful. Yes, there is always the fear that you'll lose your money, but that is inherent to any investment. Unfortunately that fear has stopped many, many people from taking the plunge into property. The way around that is knowledge and a team of people that you trust. Also remember that the Australian market is different to other international markets, each of our regions move at different times. Each city and suburb experience growth at a different pace, this is due to the local economies. This is good news, because once you get really good at investing, you can always be working on a deal in different regions.

Educating yourself is the best investment you can make. There are many, many resources online that will help you understand how it works, what to look for and lots of success stories to inspire you.

Only you can figure the best time to invest, but the bottom line is you do need funds to do it, there's no way around it. It can be either yours or someone else's.

So how did you kick off your property portfolio?