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It's time to clean up, shape up, and ship out all those bad habits.
Blogger: Stephen McGee, state manager, National Property Buyers QLD
So another financial year is over and tax time is about to reveal if you are running your property portfolio as a business or not. Using rental income to pay off your investment debt is not the only way of maximising your income from your investment. Here are my tips on how to get your house in order for the start of the financial year.
Tips to consider:
• Landlord Protection Insurance:
Even with efficient Property Management in place, tenants’ situations change, ie loss of job, sickness, separation and relationship breakdowns. This is when Landlord Protection Insurance comes into play. When choosing a policy, price should not be deciding factor. Look at cover and benefits provided.
• Tax depreciation Schedule report.
This is a great method of putting money into your piggy bank, but often overlooked. Everything has a value but as an investor you need to know that you are getting the maximum depreciable value you can for your property and its attributes. We often take over the management of properties that the landlords were not advised or they did not know about it.
• Valuation of your Investment Property:
To ensure you are keeping in touch with the current market, ask your Property Manager to arrange a review of your portfolio. This ensures you have insurance values correct and lets you know your equity standing in the property. In this upwardly moving market, the time is now to utilise this equity towards a second or subsequent property!
• Electronic records of income & expenditure:
Don’t leave it till June 2015 to ensure all your PM Statements are easily accessible and on hand. Set up a “folder” on your computer/laptop to ensure easy reference and forwarding to your accountant at tax time. NPB customers will appreciate our “Property Hub” web based portal where all statements, invoices etc are dropped and stored each week to enable direct access and transfer to your tax man.
• Efficient Property Management:
To maximise the value of your Investment, it’s essential to have a good working relationship with your Property Manager. This means, he/she knows your property intimately, has excellent communication with you – and your tenants, and acts quickly and efficiently to fix problems, rectify issues and most importantly, keep you informed at all times.
• Effective Loan structures and rates.
Make sure that you visit your financier & Tax advisor regularly to evaluate your loan position and structures of the loans. A dollar saved here is a dollar to spend there! NPB clients have access to all of our trusted panel of independent experts to help them with all of their financial needs.
All points with a tick confirm you are in good Property Management shape.
Items with cross should be transferred to “To Do” list and acted upon immediately!
About Stephen McGee
Stephen has over a decade of residential property buying and selling experience and is also an avid property investor himself. Since embarking on a career as Buyers Agent Stephen has assisted property buyers grow their portfolio with premium investment grade properties from the Gold Coast to Cairns.