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Selling An Investment Property

SELLING-AN-INVESTMENT-PROPERTY

Initially, you may think that selling a property with tenants will be too difficult, however there are several benefits. Some of the pros and cons include:

Pros

  • You will still be receiving rent throughout the selling process
  • Other investors may be attracted to a property that is already tenanted as they will receive rental income straight away.
  • Having a tenant living in the property can reassure investors that it is possible to rent this property out.

Cons

  • You will need to provide adequate notice to the tenant before having open inspections
  • Tenants may not present the property in its best possible light, which could devalue it.
  • Problems may start to arise between you and the tenant if the property takes a while to sell.

If you are considering selling a tenanted property, the process will be a little different and will require a lot of communication with the tenant. If you are able to keep the lines of communication open between you and the tenant, it may help avoid problems down the track. Listed below are a few points you will need to consider before putting the property up for sale.

When selling an investment property there are several factors to consider.


1.
First and foremost, consider the tenants. This may be your property but it is their home. Tenants can make or break a sale. Unco-operative tenants will make your agent’s life hell! It is up to them to present the property for inspection to prospective buyers.

SELLING AN INVESTMENT PROPERTY

2. Lease: Have a look at the term of your lease. It is always best to put the property on the market at the end of the lease. This will often up your pool of buyers to include buyers who want vacant possession, as well as investors who may want the tenants to stay. Do not put a 12 month lease in place and then decide to sell. The lease will be an encumbrance on the sale.

3. Tax: Investment properties attract Capital Gains Tax. Make sure you speak to your accountant to educate yourself on your own personal tax implications. The last thing you want is a huge tax bill.

4. Presentation: If you have difficult tenants, consider selling after they leave. Then tidy up the property and go to market.

Best of luck! If you need hints on how to handle tenants just give us a quick call.

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Top 10 tips for Property Investors

Property Investors

Looking for a quick and easy way to get rich?

Aren’t we all!

But while the late-night infomercials may paint a tempting picture of earning money while you sleep –the reality is that with most investments –success is the result of hard work, or making a series of calculated decisions.

Tips for Property Investors

One of the best ways to grow your wealth, aside from falling into a large and unexpected sum of money, is by investing in property for income and growth.

True, Property Investment isn’t a silver bullet that will quickly and dramatically make you prosperous overnight –but it’s a great way to grow your wealth nonetheless. Think of it as a secure and steady way to increase your reserves; allowing you to build wealth at a relatively predictable pace –thanks to the potential to earn cash flow, and benefit from appreciation and equity as the mortgage is paid off and as the property, ideally, increases in value!

If you’re interested in owning rental properties –but not sure where to begin, no worries! The great thing about property Investment is that it’s something that almost anyone can get started with, regardless of whether they have any experience with investing. With the right approach –and plenty of hard work, you too can find success with rental properties.

In this article, we’ll uncover everything you need to do to set yourself up for success with property investment –and begin building your own rental property empire!

Set Clear Goals

First, you’ll want to sit down and establish some clear goals for your real estate investments. What are your financial objectives? Do they center on cash flow –to earn, say $5,000 a month? Or, are they more long-term –such as owning ten investment properties in areas where homes are expected to appreciate? Once you know what you want from real estate –you’ll be able to create a plan to make it happen and determine how you will use real estate to reach your objectives. Maybe you’ll want to buy one property every year until you reached your goals –or, maybe you’ll want to look into financing options to determine what you need to do to get yourself into a position to invest. Once you’ve established your long-term goals, you’ll have a clearer sense of direction –and will be able to work backward, so to speak –taking steps to reach your goals.

Tips for Property Investors

Treat Investing Like a Business

Before you begin, you’ll want to ensure that you have the right mindset. If you go into real estate investing treating it like a part-time hobby, you probably won’t have much success. The only real way to make money from real estate – is by treating your venture like the money-producing enterprise that it should be! It’s important to treat investing like a business–this means setting clear objectives, being organized, and building systems that allow you to work efficiently. Additionally –as time goes on, and you begin to scale your investments, you’ll be thankful that you established a solid framework for your business from the start.

Educate Yourself

Knowledge is power! Before you begin your journey, you’ll want to educate yourself on rental property to ensure that you’re well-informed on real estate and rental property investing. Scour the net looking for informative articles from reputable websites, and get yourself a few good books on rental property investing. Many new investors make the mistake of diving in without spending any time familiarizing themselves with how property and the real estate market work. While you can learn as you go, brushing up on some basic real estate knowledge ahead of time will save you from making potentially costly mistakes along the way.

Find Your Niche

Next, you’ll want to decide what type of properties you’re going to focus on. Single-family homes, or maybe units? Duplexes and triplexes? Are you going to invest locally –or long-distance? You’ll also want to determine what type of returns that you’re hoping to get from each of your properties. Being specific will help you to be more strategic with your investments; allowing you to choose only the best properties –ones that are going to produce a rate of return that’s in line with your financial goals.

Tips for Property Investors

Start Small

Don’t worry! You don’t have to rush out and buy a 30-unit complex when you’re first starting out! Most investors start out smaller –with a single-family home or duplex. In fact, your first investment could even be your own home. Starting small will give you a chance to lay a solid foundation, allowing you to learn the ropes before jumping into the bigger investments, where there’s usually a lot more financially at stake.

Assemble Your Team

While first-time investors often feel that they have to go it alone –don’t overlook the benefits of having a network of experienced professionals by your side. Before you start, it’s a good idea to assemble a team –people that you can call on for property-related help and advice. If you’re purchasing real estate –especially if it’s out of town, it’s important to find an investor-friendly real estate agent in the local area that you can work with. You may also want to secure an accountant –to find out how investing in property will affect you from a tax perspective. Finally, if you plan to invest in rental properties –do yourself a favor and connect with a reputable and experienced property manager. Establishing connections with professionals will save you from a tremendous amount of hassle –and a world of frustration.

Plan for the Unexpected

Don’t forget to plan for unexpected expenses along the way. Vacancies, issues with tenants, and costly repairs can all take a significant bite out of your income, and it’s important to have some funds set aside in case of emergencies. If you’re planning to purchase a property that’s in need of repairs –be smart. Make sure you have enough saved to make the necessary upgrades in a timely manner –to prevent your property from sitting empty while you have to cover the expenses! If you’re buying a renovation project you may look at obtaining the right type of loan that will release funds as required. This would allow you to incorporate the cost of the repairs into the loan –a good way to make buying a fixer-upper a feasible option. Just remember that repairs often end up costing more than expected –so be sure to plan for some additional expenses along the way.

Run the Numbers

Now, it’s time to crunch the numbers! Once you’ve found a property that you’re interested in, run the numbers to ensure that it’s a good investment. A classic rule of real estate says that a rental should yield at least be dollar for dollar, that. This means if you have a property that costs $600,000, you should be able to try to get $600 per week in rent. Of course –it’s important to never make your investments based on speculation alone. Don’t assume that you’ll be able to get dollar for dollar. Instead, you’ll want to make sure you base your calculations on facts and solid figures. Check to see what similar properties in the area are renting for on Domain and Realestate.com.au –and connect with a local property manager or real estate agent to get their thoughts on the viability of a potential investment. Finally, you’ll want to add up your projected expenses –including the mortgage, taxes, insurance, utilities, maintenance, repairs, and unexpected vacancies –and subtract this from your income to find your cash flow. Then, take things a step farther and calculate your cash on cash returns –make sure your yield is in line with what you’re hoping to generate from your income properties.

Hire an Inspector

We can’t emphasize this one enough! It’s important to hire an independent home inspector to check the property before you buy, to ensure there’s no costly and extensive hidden damage –and to fill you in on the exact condition of the home. If time is of the essence and you need to make an offer quickly –make sure there is an inspection contingency included in your contract –this way, should the inspector finds any major problems, you’ll be able to back out.

Don’t Quit Your Day Job

Real estate investing can be an exciting time –but don’t hand in your resignation notice at work just yet! Many experts advise against quitting –especially early on. Keeping your job will save you from having to spend all of your rental income on living expenses when you’re first starting out and will allow you to instead reinvest your profits back into your investments in order to maximise your returns. Once you have a few properties under your belt –and your cash flow begins to surpass what you’re making at work, you’ll be able to think about leaving.

While Property Investing isn’t a get rich quick scheme; it certainly can be an excellent long-term investment opportunity. With careful planning –and the right approach, you’ll be able to grow your wealth and save for the future –the smart way!

Do you own Rental Properties? What advice would you give to someone who’s just starting out? Share your thoughts with us!

Thanks to renterswarehouse.com

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9 great things about granny flats

5 great things about granny flats

They might not seem like the most glamorous of property extensions, but granny flats are becoming increasingly popular among renters, homeowners and investors.

Here are five reasons why you might want to consider investing in one!

Read more

8 Great Ways to Select the Right Tenant for your Investment Property

8 Great Ways to Select the Right Tenant for your Investment Property
One of the biggest challenges an investor has to overcome is selecting the right tenant for their property. This is particularly the case in areas of Brisbane, such as Chermside and McDowall, where rental vacancy rates are currently very high because of an oversupply of rental properties particularly apartments and townhouses, leading to a downward pressure on rents.

Property investors should take a commonsense approach to selecting a tenant by considering the following eight points:

8. Rental price: Rental property can remain vacant for prolonged periods of time because the landlord is charging above the market rate for the property. Even if the rental property is $10 above the average weekly rent for the area, the landlord may find it hard to find a tenant in an area where there is an oversupply of rental properties. It is therefore critical that the rental costs are competitive and landlords should check rental prices in the local area for similar properties before determining your rent.

7. Young people: Don’t discriminate against young people because they are your largest pool of potential tenants. Surveys indicated that more than half of all young (under 35 years) lone-person households rent privately.

6. Marketing: Make sure that the property is exposed to the maximum number of tenants through newspaper and internet advertising. The property should regularly adverted because the pool of tenants is constantly changing.

8 Great Ways to Select the Right Tenant

5. Availability: Tenants are constantly looking for rental properties seven days a week. You therefore have to make some time available every day for property inspections if you are trying to find a tenant for the property.

4. Presentation: When leasing your rental property, take the same approach as if you were selling the property. The overall presentation of the property will make the property more attractive to prospective tenants. Many people looking for rental accommodation do not even inspect the property because it looks poorly presented from the outside. You can increase the street appeal of the rental property by keeping the front gardens in a good condition. You don’t want prospective tenants to dismiss the property before getting to the front door.

3. Air-conditioning: Ensure that your rental property has lifestyle features. For example, a dishwasher and air-conditioning are key features which tenants seek in a rental property. These features can also enable the landlord to charge a higher rent. If your rental property does not have these features then a tenant is likely to rent an alternative property.

Select the Right Tenant for your Investment Property

2. Landlord protection insurance: Always take out landlord protection insurance. Should a tenant do a runner, this can cover you for any damaged caused plus can cover you for lost rent.

1. Property manager: Always appoint a professional property manager because this is one of your biggest assets. They will be able to undertake the necessary background checks on prospective tenants and undertake regular property inspections to ensure the property is kept in a top condition.

The team at Madeleine Hicks Real Estate is a good place to start if you are looking for a property manager.

Thanks to RPMOnline.com.au

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The Golden Ticket

everton-park-real-estate-madeleine-hicks

There’s a man in France who owns what the Financial Times is calling a “magic ticket.” In their words: “It lets him turn back the clock, to invest with perfect hindsight week after week, steadily accumulating a fortune.”

Sounds like a sweet deal, no?

In 1987, Max-Hervé George’s father bought a life insurance contract from Aviva France. But this was no ordinary life insurance contract.

For some reason – which is still lost on me – the insurance company offered a contract that allows the purchaser to buy into any investment fund of his choosing, on Friday, but at the previous Friday’s prices.

Did you catch that?

He gets to pocket the investment returns… of last week’s top-performing fund… after the performance of all available funds is known.

“So you say Chinese stocks did the best last week? OK… I’ll buy those… at last week’s prices, please and thank you very much.”

Mr. George has reportedly exercised his contractual right with fervor, profiting from last week’s winners, week after week, earning an unimaginable 68% per year!

The story is truly remarkable. And if you think Mr. George’s deal is “too good to be true,” you’re more or less correct.

The insurance company offered these “magic ticket” contracts to a very small group of wealthy clients (who, back then, had to visit the broker in person). They have since bought out most of the contract holders. And they’re fighting Mr. George’s contract in court, since he (wisely) refused to sell it back to them.

Suffice it to say, YOU will NEVER be able to buy a “magic ticket” quite as nice as Mr. George’s.

However investing in property in Brisbane's North Western suburbs may be a close substitute.

Everton Park has achieved 9.82% growth in the last 12 months and a long term rate of growth of 6.28%.

Stafford Heights  has achieved strong 12 monthly growth of 9.54% and longer term growth of 5.70%

Stafford  gained 5.81% in the last 12 months and 6.41% over the long run.

So you do not need to have a "Golden Ticket", simply investing into some of Brisbane's best suburbs will work well for you.

7 steps to making the leap from homeowner to property investor

7 steps to making the leap from homeowner to property investor

Many home owners are sceptical about putting on an investor’s hat, but understanding how to go about it is a lot clearer cut than you think. You may believe you need a University qualification to read between the data, but with the right advice, you can easily set yourself up with a growing asset for a long time coming all on your own.

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Why you should move to Everton Park

Why you should move to Everton Park

Brisbane has long been touted as the next property capital growth hub of Australia, and it looks as though the sunshine states capital may finally deliver on its promise. For years it has trailed behind Sydney and Melbourne’s property markets, but as growth began to slow in these capitals, Brisbane was predicted to be the benefactor.

Read more

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Open Home Inspection Times for This Week

Open Home Inspection Times for This Week

Saturday, 18th June

09.00 to  09.30am     6 Bowen Ave Albany Creek
09.30 to 10.30am     1/216 Trouts Rd McDowall
10.30 to 11.00am     26 Eastbourne St Chermside West
10.30 to 11.00am      3 Nelson Ct McDowall
10.30 to 11.00am     41 Andress St McDowall
11.30 to 12.00pm     39 Mountridge St Everton Park
11.30 to 12.00pm     167 Saraband Dr Eatons Hill
12.10 to 01.00pm     111-123 Soames St Everton Park
12.30 to 01.00pm     35 Ainsdale St Chermside West
12.30 to 01.00pm     41 Soames St Everton Park

 

If you have enquiries, call Madeleine Hicks Real Estate team today on: 07 3355 6845.

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Quick Tips: Bidding Guide For Auctions

Bidding at auctions can be a high adrenaline event, especially for buyers who are unprepared for the high-stakes and fast paced action.

Research suggests that only about 40% of people or buyers who go to bid at an auction are actually prepared with a bidding strategy. This means 1000’s of bidders are going out each weekend with the intention to spend hundreds of thousands of dollars at the mercy of the market, vendor, seller and luck. A concerning thought.

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Open Home Inspection Times for This Week

Open Home Inspection Times for This Week

09.00 to 09.30am       6 Bowen Ave Albany Creek

09.30 to 10.00am      167 Saraband Dr Eatons Hill
10.30 to 11.00am      26 Eastbourne St Chermside West
10.30 to 11.00am      3 Nelson Ct McDowall
11.00 to 11.30am       41 Andress St McDowall
11.30 to 12.00pm       125 Keona Rd McDowall
11.30 to 12.00pm       39 Mountridge St Everton Park
12.10 to 01.00pm      111-123 Soames St Everton Park
12.30 to 01.00pm       41 Soames St Everton Park
01.30 to 02.00pm       125 Keona Rd McDowall