The end of the financial year is fast approaching, which means one thing for Perth’s property investors – it’s time to start thinking about how you can maximise returns on your rental investment.
The amount of money you make on your investment depends on various factors. Carrying out research, knowing your tax entitlements and getting the right advice from a good property management service can make all the difference when it comes to maximising profit and minimising costs on your Perth property.
Here’s some top tips on how to get the most out of your rental investment at tax time and beyond:
1. Do your research
Maximising returns on your Perth property investment is all about knowing your market. If you want to ensure your rental prices remain competitive, you need to compare your property with similar rentals in the area.
Increasing rental prices once a tenant has already signed the lease isn’t necessarily a straightforward process. Depending on the clauses in your lease agreement, it may take time for these changes to come into effect (if at all).
Therefore, it’s important to do your research in advance and choose a lease agreement that best suits your property and your prospective tenants.
2. Choose the right home loan
Just as you need to do your research before investing in a property, you also need to find a home loan that best suits your long-term financial plan.
Researching the mortgage market and comparing home loans from different lenders will help you find the best rates and repayment plan to suit your individual needs. Choosing a flexible loan with competitive interest rates could drastically reduce how much money you spend on your mortgage in the long run.
Come tax time, you will be able to deduct the cost of bank fees, borrowing expenses and charges on your loan accounts from your yearly return.
3. Know your entitlements
Knowing your rights at tax time will help you minimise expenses and maximise gain on your Perth investment property.
As your rental gets older and requires renovation, you may be able to claim depreciation on your investment and newly-purchased items within it (such as carpets, curtains and kitchen appliances).
If your property was constructed or renovated after a certain year, you will also be entitled to capital works deductions.
By keeping on top of deductible expenses and having a qualified quantity surveyor carry out a Depreciation Schedule, you can avoid paying more money than required at tax time.
4. Don’t ignore repairs and maintenance
A well-presented property can make a whole world of difference when it comes to maximising returns on your investment.
Keeping your property in good condition by carrying out regular repairs and maintenance will help you attract more interest from Perth’s renters, thus increasing the value of your property when it goes on the market.
These small improvements (it could be as simple as a fresh coat of paint) could make a big financial difference in the long run.
You should also bear in mind that property investors are entitled to tax deductions on repairs and maintenance when it comes to tax returns.
5. Find a good property management service
If you plan on making the most out of your Perth property investment, you should consider enlisting the help of a professional property management service. As well as helping you find the right tenants for your rental, property managers will take care of maintenance issues and ensure your rental prices remain competitive.
With the right insight from Perth’s property management specialists, you could be making easy money off your investment for years to come.
Perth’s property management specialists
Rentwest provide property management services for property owners and tenants across the Perth metro area. If you’re a property investor or aspiring to become one, the dedicated team at Rentwest can save you the stress of managing your property and provide you with the solutions you need to maximise profit on your investment.