Managing an investment property
by Wealth Know How in Property
You have two options when it comes to managing your property: you can do it yourself, or engage a managing agent to do it for you. If you manage the property, you can avoid paying management costs – but for that saving, you will have to do everything, from showing the property to tenants to collecting rent and organising repairs. You also need to comply with landlord regulations. Work out objectively just how much that trade-off between being your own manager, and not paying management fees, costs in terms of the added hassle. Perhaps it costs more than the actual management fees. Remember, if your tenant complains that the oven is not working or the shower starts leaking, you need to fix it straight away
- sponsor - Wealth Know How
Wealth Know How is the online network helping people manage their wealth through financial education. Whether you are looking for simple ways to better manage your cash, or you are after a complete strategy on how to save for retirement, we can help you understand your options. It is important to have a vision for your future, but its knowledge not dreams that will ultimately deliver financial success.
Published on 25 Mar 15
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You have two options when it comes to managing your property: you can do it yourself, or engage a managing agent to do it for you. If you manage the property, you can avoid paying management costs – but for that saving, you will have to do everything, from showing the property to tenants to collecting rent and organising repairs. You also need to comply with landlord regulations. Work out objectively just how much that trade-off between being your own manager, and not paying management fees, costs in terms of the added hassle. Perhaps it costs more than the actual management fees. Remember, if your tenant complains that the oven is not working or the shower starts leaking, you need to fix it straight away
Sponsor - Wealth Know How
Wealth Know How is the online network helping people manage their wealth through financial education. Whether you are looking for simple ways to better manage your cash, or you are after a complete strategy on how to save for retirement, we can help you understand your options. It is important to have a vision for your future, but its knowledge not dreams that will ultimately deliver financial success.
-
Venezuela tension heats up
Duration 03:16
-
Aussie dollar surprises market
Duration 03:10
-
Markets climb as investors watch US healthcare bill
Duration 02:31
If you do decide that it is a lot easier to have a managing agent to look after the property, the management fees you'll pay are tax deductible.
As owner, you will need to organise building insurance. This covers you for full building replacement if, say, the house burns down. If you buy a unit, building insurance should be paid from your strata levies.
You should also consider taking out landlord’s insurance. This protects you if your tenant damages the property or if they run off before the agreed end of the rental term, or without paying the rent. Again, the cost of landlord insurance is tax-deductible.
If you are relying on part of your employment income to cover the interest cost and expenses, make sure you have adequate income protection insurance, to ensure that you don’t lose your house if life takes an unexpected turn.