Whether you’re a first-time investor or have experience in the landlord business, it’s crucial to avoid common mistakes that can cost you money, time, and stress. Here are a few to keep in mind:
1️⃣ Choose your tenants wisely: While it’s tempting to fill a vacant property quickly, take the time to vet potential tenants. Make sure your property agent checks their payment history, lease record, references, and income status. Skipping this step may lead to inconsistent rental payments or tenants leaving unexpectedly, causing financial stress.
2️⃣ Budget for maintenance costs: Maintaining your rental property keeps tenants happy and may increase rental income. Remember to account for expenses like painting, carpets, appliances, and unexpected damages. Set up a “maintenance account” and contribute regularly to avoid being caught off guard.
3️⃣ Get the right insurance: Building and contents insurance are familiar to most landlords, but it’s essential to find a policy that covers tenant-related incidents. With recent legislative changes, ensure your insurance protects you from damages caused by pets or other tenant-related issues. RACV Landlord Insurance provides comprehensive coverage for property damage, loss of rental income, tenant possession removal, unauthorised alterations, and lock replacement.
4️⃣ Maximize deductions: Keep meticulous records of all property-related expenses, as they can result in significant deductions. Body corporate fees, rates, cleaning costs, property management fees, loan interest, and maintenance fees might be deductible. Don’t miss out on potential savings—keep receipts and maintain thorough records!
Remember, research is key to being a successful landlord. Take the time to compare options and understand the fine print to ensure you’re financially protected from unforeseen events. By avoiding these mistakes, you’ll set yourself up for success in the landlord business.