I’m a baby boomer without a lot of money in superannuation but enough cash for a sizeable deposit on an investment property. I am considering buying an apartment for some extra retirement income. Friends have shared horror stories of properties getting trashed by tenants and being owed heaps of rent. What is your advice to avoid any bad experience; should I become a landlord? Peter, Sancrox
A. My advice is to treat property investing as a business – and as every successful business owner knows, this requires diligence, discipline and a healthy investment of both time and money from time to time. Quality property attracts quality tenants, so make sure you select the right property in the first place and keep on top of any maintenance or refurbishments needed. Property in poor condition requiring ongoing maintenance not only affects your bottom line, but rarely attracts good tenants. Who would want to live in a place where things constantly go wrong? If you are considering trying to self-manage the property, watch out; this can be full of pitfalls. A professional property manager will find and qualify suitable tenants, look after your asset and help you avoid the horror stories you mentioned. Try to engage an experienced property manager, with as much diligence as yourself. Make sure regular inspections are undertaken and include yourself on the inspection team if possible. This allows you to see the property for yourself and stay completely informed about its condition. Be prepared for fair wear and tear, but don’t defer maintenance. By fi xing problems immediately, you’ll set a good example for the tenants and show the property manager you expect high standards to be maintained. I also recommend landlord insurance as money well spent. For a relatively small outlay, you can be covered for accidental or malicious damage, as well as loss of rental income. Peter, don’t let fear hold you back from benefiting from the type of solid monthly income only bricks and mortar can provide. Give me a call if you need more guidance when the time comes. Answers are general comment, and readers should always seek their own independent professional advice. Send your real estate questions to firstname.lastname@example.org
Greg Trembath is Principal/Licensee at Greg Trembath Real Estate.
Licensed Real Estate Agent – Licensed Auctioneer.