fbpx

7 ways to maximise your returns as a property investor

In many cases, we buy homes largely with our heart. But we should buy investment properties entirely with our head, because the aim is usually to generate the largest possible financial return.

With that in mind, here are seven ways to maximise your investment returns.

1. Select the right location

There’s a rule of thumb that location dictates 80% of a property’s long-term price and rental performance. So it can be smart to base your choice of location on hard data rather than gut feel. You can either do this research yourself or outsource the process to a buyer’s agent.

2. Choose the right property

It’s important you avoid properties with red flags, such as structural problems or pest infestations, otherwise you’ll have to spend a lot of money on remediation in the years ahead. You can reduce this risk by hiring building and pest inspectors. Also think carefully about homes with limited appeal, such as those on noisy roads or far removed from amenities, as their price and rental growth could be limited.

3. Find a good property manager

A good property manager could make you, rather than cost you, money, by helping you fill your property faster, for longer and with better-quality tenants. Also, they could also help you set just the right rent – not so high that you scare off tenants and not so low that you leave money on the table.

4. Maintain your property

Conducting regular maintenance can help you maximise your returns in two ways. First, it could help you attract and retain tenants. Second, it could prevent small problems, which are relatively cheap to solve, from turning into bigger problems, which can be very expensive.

5. Do strategic renovations

Renovating your home can be a fast way to increase its value and rent. But you need to be careful not to overcapitalise and not to invest in modifications that are of little appeal to potential buyers and renters. Also, renovating is not suitable for everyone, because it usually requires a significant upfront investment.

6. Collect all your tax benefits

Depending on your scenario, you may be able to reduce your taxable income through negative gearing and claiming depreciation. To do that, it’s a good idea to keep thorough records of all your expenses, invest in a tax depreciation schedule from a quantity surveyor and hire a good accountant.

7. Refinance your loan

It’s a good idea to at least compare your home loan to others each year. That’s because even though you probably got a great loan at the time, the mortgage market is always changing. This means you might now be able to switch to a comparable loan with a lower interest rate or one that is better suited to your needs

– – –  

How long has it been since you took out your home loan? If it has been a while, contact us today so we can let you know how much money you might be able to save by refinancing.

Licensing statement: Rayne Finance ABN [70 605 100 838] is authorised under LMG Broker Services Pty Ltd Australian Credit Licence 517192. Disclaimer: (1) As with any financial scenario there are risks involved. This information provides an overview or summary only and it should not be considered a comprehensive analysis. You should, before acting in reliance upon this information, seek independent professional lending or taxation advice as appropriate and specific to your objectives, financial circumstances or needs. This publication is provided on the terms and understanding that: (2) LMG Broker Services Pty Ltd, Rayne Finance (Seed Lending Pty Ltd) and the authors, consultants and editors are not responsible for the results of any actions taken on the basis of information in this publication, nor for any error in or omission from this publication. (3) LMG Broker Services Pty Ltd, Rayne Finance (Seed Lending Pty Ltd) and the authors, consultants and editors, expressly disclaim all and any liability and responsibility to the maximum extent permitted by the law to any person, whether a purchaser or reader of this publication or not, in respect of anything, and of the consequences of anything, done or omitted to be done by any such person in reliance, whether wholly or partially, upon the whole or any part of the contents of this publication.

Explore other FAQs and Facts

Federal Budget 24/25 – what does it mean for you?

Federal Budget 24/25 – what does it mean for you?

Discovering the impact of the 2024/2025 Federal Budget is vital in navigating the current economic landscape. With a focus on addressing the cost-of-living crisis and bolstering the construction sector, measures such as infrastructure investment, rent assistance, and tax cuts aim to alleviate financial burdens and stimulate growth.

How a broker guides your way to owning your first home

How a broker guides your way to owning your first home

Dreaming of your first home? A mortgage broker can be your guiding light. From assessing your borrowing capacity to breaking down costs and exploring deposit options, they make the journey smoother. With their expertise, owning your dream home in Australia becomes not just a dream, but a tangible goal.

5 things to keep in mind before refinancing

5 things to keep in mind before refinancing

Considering refinancing your home loan? While securing the lowest interest rate is tempting, it’s vital to assess beyond that. Lenders vary in serviceability criteria, fees, turnaround times, and lending criteria. Additionally, explore promotions and consider restructuring your loan for optimal outcomes. Learn 5 key factors to save time and money.

How to calculate your equity

How to calculate your equity

If you’ve owned your home for some time, you likely have built up equity—a valuable asset. Equity represents the difference between your home’s value and what you owe on your mortgage. Understanding this figure can empower you financially and open up opportunities for leveraging your home’s value.

March cash rate held – why are buyers feeling more confident?

March cash rate held – why are buyers feeling more confident?

Following the Reserve Bank of Australia’s decision to keep the cash rate steady at 4.35%, there’s speculation about future cuts amid economic indicators showing weakness. However, rising buyer confidence and strong property growth, especially in housing, continue to drive the market forward.

When was your last home loan health check?

When was your last home loan health check?

Is your home loan still serving you as it should? Over time, circumstances shift, potentially rendering your loan less than ideal. A home loan health check, conducted by your finance broker, ensures your loan remains competitive and aligned with your needs. It’s a stress-free process, offering potential savings and improved features, all at no cost to you.

What happens when your fixed rate term ends?

What happens when your fixed rate term ends?

Fixed rate terms, typically lasting one to five years, define your loan’s interest stability. As this period concludes, your loan may shift to a variable rate unless you opt otherwise. Prepare by discussing potential rates and options with your mortgage broker. Consider repricing or refinancing for better terms, mindful of associated costs.

8 Ways to Strengthen Your Loan Application

8 Ways to Strengthen Your Loan Application

Looking to bolster your loan application’s chances? Here are 8 practical steps to enhance your creditworthiness and secure that approval. From reviewing your spending to consolidating debts, each strategy is aimed at strengthening your financial profile.

What is Mortgage Refinancing and how does it work?

What is Mortgage Refinancing and how does it work?

Refinancing your mortgage can be a strategic move to secure a lower interest rate, switch loan types, or consolidate debts. However, it’s crucial to weigh the potential benefits against costs like exit fees and taxes. Consulting a mortgage broker can help you navigate the process and determine if refinancing is the right choice for your financial situation.

Refinancing: Your Smartest New Year’s Resolution

Refinancing: Your Smartest New Year’s Resolution

2024 brings a promising avenue for financial growth through refinancing. Investors can unlock capital for new ventures, while homeowners discover resources for home improvements and equity growth. Considering refinancing before fixed-rate terms end allows stability and avoids unexpected payment hikes. Delve into our blog to explore the diverse benefits and embrace greater financial stability and flexibility in the coming year!