How to minimise your investment property’s ongoing costs

Posted in Property Management on December 21, 2021 by Anthony Somlai

Minimising your investment property’s ongoing costs is a great way to improve your return. Unfortunately, many landlords focus their energy on maximising tenant rent, which is a factor that’s largely set by the market.

Controlling your outlays

Experienced investors know that successful property management is also about minimising the outlays that you can control. Ways that you can do that include:

Regularly inspecting your property and communicating with your tenants.
Using excellent tradespeople for any repairs and maintenance expenses.
Buying good-quality appliances, fixtures and fittings for your property’s kitchen and bathrooms.
Having appropriate insurance cover.
Accommodating or restricting tenants with pets.
Attracting good long-term tenants.

Let’s look at how each of these things can minimise your ongoing investment property costs.

Regular inspections and regular communication with your tenants

Regular inspections of your investment property allows any necessary maintenance expenses to be identified as quickly as possible. This is a good thing, because it allows any minor problems to be fixed before they become major and expensive.

Regular communication with your tenants is also important for quickly identifying any repairs and maintenance issues. At HPA, our property management team prioritises tenant communication so that any problems can be dealt with promptly.

Developing a rental property maintenance plan is also a good idea.

Rental property maintenance expenses

Using high-quality tradespeople for any repairs and maintenance work that needs to be done on your investment property will save you money in the long run. They will get the job done properly and their work will stand the test of time.

At HPA, our property management team has a pool of affordable, high-quality tradies that we can trust to do an excellent job.

Buying quality appliances, fixtures and fittings

Spending a little bit more to buy quality appliances, fixtures and fittings for your investment property’s kitchen and bathrooms will also save you money in the long run. They will be more durable and will last longer.
It’s important to understand that if you’re repairing or replacing appliances, fixtures and fittings, the expense is fully tax-deductible at the time it’s incurred.

But if you’re renovating or improving your investment property, the expense isn’t tax-deductible if you’re a personal investor. But it can reduce your capital gains tax (CGT) obligation when you sell the property at a profit.

Speak to your accountant on understanding the tax benefits.

Insurance

The right level of insurance cover can give you peace of mind to protect you against damage to your investment property caused by tenants or natural disasters like floods, fires, storms or cyclones. Even though insurance is an expense, it will more than pay for itself if your property is ever significantly damaged and you need to make a claim.

Accommodating or restricting tenants with pets

Allowing pets can make your property more attractive to tenants, but it’s important to have the right flooring to minimise your ongoing costs. Linoleum or timber flooring will get less dirty over time and last longer than carpet if pets are regularly inside your property. Carpet replacement can be expensive.

Attracting good long-term tenants

Good long-term tenants can save you money in two ways:

They will look after your property better (so fewer repair and maintenance costs)
They reduce your need to spend money advertising for new tenants.

The best ways to attract good long-term tenants are to keep your property in good condition and to make sure you are responsive to any genuine repair and maintenance issues that arise.

How we can help

If you’re looking for a property manager to help you minimise your investment property’s ongoing costs, our experienced team at Home Property Agents can help.

We manage a diverse range of investment properties in Neutral Bay and surrounding suburbs in Sydney’s Lower North Shore.

We can also help you if you’re looking to buy your first investment property, expand your portfolio, or sell – feel free to contact us.