by George Astudillo | Dec 16, 2019 | Financial, Inspiration, Planning, Repairs and Maintenance
With 2020 fast approaching now is the time to be thinking of the goals you’d like to achieve for the management of your investment property, to ensure that your investment will continue to provide a sustainable, consistent and trouble free income for years to come.
An investment property requires advanced planning and follow through. Creating a list of New Year’s resolutions before the start of the new year can ensure that you have confidence, a systemised approach and the right mindset to grow your asset.
Here is a checklist for you to get started when preparing for a successful 2020.
1. Insurance
Landlord insurance is your investment property safety net. You should be asking yourself ‘Do I have the appropriate cover?’ and ‘Am I making the most out of what I pay for?’. There are also different types of cover depending on whether you have an agent or manage the property yourself. Take the time to review what you have. For more on Landlord Insurance see our previous blog ‘Landlord Insurance- Manage Your Risk’.
2. Smoke Alarms
As a landlord you are legally required to have met the obligations for the installation and maintenance of smoke alarms in your property. Many smoke alarm companies will offer unlimited servicing programs to provide peace of mind knowing your tenants and property are protected. Make sure all your bases are covered. New reforms to the tenancies act coming next year will mean you, as the landlord, will be fully responsible to make sure smoke alarms are operational.
3. Mortgage review
Keep your investment tailored to your budget and working in your best interests by regularly reviewing your home loan. If you haven’t reviewed your current interest rate in the last few years, you may be paying too much interest. It’s easy to let the finer details of your mortgage fall by the wayside but by keeping an eye on the market you may just come across a great deal. Sign up to a comparison website or ask a mortgage broker for advice.
4. Rent review
The new reforms to legislation will mean rent increases may only be implemented once in a twelve month period. Schedule your rent review date a few months in advance to coincide with a routine inspection. At “Property Quarters” we conduct regular rent reviews and keep an eye on market changes to ensure your property is keeping pace. See our blog ‘Rent Reviews- 5 points to Consider’.
5. Property Maintenance
One of the most nagging of New Year’s Resolutions, but just as equally important, is appraising your property for repairs and updating. Unexpected repairs can happen at any time, don’t be caught out unprepared. Create a plan and put aside funds. Most repairs and maintenance are tax deductible, check out our Section on Depreciation for a quick overview of investment depreciation.
6. It’s not who you know it’s what you know!
Knowledge is power so make it a priority to become as shrewd as possible in property investment. Your carefully planned nest egg is critical to your future. It can make a real difference between struggling to make ends meet and the joy of a secure retirement- so make your investment work to its absolute potential! You can do this by brushing up on your knowledge. Our website ‘www.propertyquarters.com.au’ is packed with free information to get your landlord mindset on the right track.
7. Review of your managing agent
“Choosing a Property Manager is possibly the most important part of owning an investment property. You are relying on a professional to guide you towards financial independence; make sure you are in the right hands.”–George Astudillo.
Your managing agent should be in regular contact with you, efficient with planning, have extensive market and industry knowledge and above all they need to look after your best interests at all times. If you have any doubts about how your property is being looked after it might be time to make a change.
About Us
George Astudillo is the founder of Property Quarters, an agency that values communication and great relationships with its landlords.
George now has more than 30 years in real estate, including 15 years as the owner of a national real estate franchise. He’s also an accredited auctioneer and is the author of “The Landlord Mindset”, a book with his best tips to help landlords look after their investments. His book has been quoted in the SMH, The Huffington Post and The Age.
As the founder of Property Quarters, George takes great care in looking after his landlord’s investments. Having seen it all and worked with may landlords and tenants, he’s a strong mediator and negotiator and knows how to navigate through property legislation.
George is trusted by his landlords to advise on the financial management of their investments. He’s put in place proven processes to ensure each property he looks after is managed effectively to retain its value, quality tenants and rental income.
by George Astudillo | Oct 1, 2019 | Financial, Management Systems, Presentation, Repairs and Maintenance, Tenant
Once you’ve got one, you’ll want to be sure they stay.
(From the article and interview featured in The Huffington Post Australia)
One of the challenges of property investment is being able to find the elusive ‘perfect tenant.’ It’s that ideal tenant that will ensure the financial success of your property, as well as give you peace of mind that they will take great care of your investment.
A good tenant is made up of several factors but perhaps the number one attribute is a person who always pays their rent on time.
Real estate expert and author George Astudillo told The Huffington Post Australia late rental payments is a top frustration for many landlords.
“Late payment leads to frustration and embarrassment as it makes the landlord late in paying expenses, such as a mortgage,” Astudillo said.
“Cleanliness is a major factor; an ideal tenant will take care of the property. Being lazy with household chores will speed up wear and tear. Paint needs to be dust and grime free and carpet will wear out quickly if grit and soiling are allowed to accumulate.”
“A perfect tenant is a co-operative tenant, particularly in the event of a problem. Life is unpredictable, it’s tough enough dealing with challenges without a tenant making things more difficult.”
The trick is to choose wisely when you choose a tenant and don’t take any chances. You might be tempted to take a risk on a tenant who’s willing to pay more money. However, Astudillo said if they turn out to be less than they promise to be, the cost of new carpet, repainting and repairs will quickly absorb the increase and leave you in debt.
“If a property has been vacant for a while there can be a tendency to cut corners. Don’t let the temptation cloud your judgement,” Astudillo said.
“Sometimes a tenant just seems so nice, you want to give them the benefit of the doubt. Remember nice people don’t always make good tenants.”
Once a landlord selects the right tenant, it’s wise to take steps to make sure they stay put. If you’re not careful, your tenant will leave: turn over costs a lot of money, including marketing fees, agents’ fees and possible property damage. See our blog “3 Keys to Choosing the Right Tenant”
While there are multiple reasons why tenants move – and many will be out of your control – there are some simple things you will have control over
“Looking after your tenant and the property they live in makes good business sense. The tenant is your customer, and having a happy customer is always good for business,” Astudillo said.
George Astudillo’s Landlord Checklist
Repairs
Treating repairs too casually or without care is the most common reason for creating distrust and discontent in tenants. Unless the problem is an emergency, they are at the mercy of the owner. Reasonable requests for repairs should happen quickly.
Maintenance
Allowing the property to deteriorate will change the appeal to the tenant. If the property is no longer up to the quality the tenant is prepared to pay for, they will move. Keeping your property looking its best will also mean you can keep the rent within reach of the market.
Rent reviews
Rent increases that are excessive, either too many or too much, will also make a tenant feel taken advantage of. In these situations, the tenant will start looking for better value elsewhere.
Courtesy and Respect
Tenants need to feel respected. Your attitude towards repairs, maintenance and rent reviews, as well as the tenants’ right to privacy, are simple ways to show respect.
About Us
George Astudillo is the founder of Property Quarters, an agency that values communication and great relationships with its landlords.
George now has more than 30 years in real estate, including 15 years as the owner of a national real estate franchise. He’s also an accredited auctioneer and is the author of “The Landlord Mindset”, a book with his best tips to help landlords look after their investments. His book has been quoted in the SMH, The Huffington Post and The Age.
As the founder of Property Quarters, George takes great care in looking after his landlord’s investments. Having seen it all and worked with may landlords and tenants, he’s a strong mediator and negotiator and knows how to navigate through property legislation.
George is trusted by his landlords to advise on the financial management of their investments. He’s put in place proven processes to ensure each property he looks after is managed effectively to retain its value, quality tenants and rental income.
If you’re looking for a property manager who thinks like a landlord and whose business is built on tested processes, contact us by clicking HERE.
Copyright © 2022, www.propertyquarters.com.au
by George Astudillo | Aug 7, 2019 | Financial, Landlord mindset, Management Systems, Planning
There are alternatives but you need to be aware of the pitfalls.
(From the article and interview featured in The Huffington Post Australia)
With so many people literally locked out of the hot Sydney property market, it’s only natural to look for alternative ways to get a piece of the action. Perhaps you could co-invest with a sibling or close friend?
You could look at ‘rent-vesting’, buying a car space or consider property trusts.
One solution by Fintech company BRICKX is a way to invest in a property for less than $100. It works by dividing individual properties into 10,000 ‘Bricks’, which are effectively units, in a Trust.
BRICKX publicly launched in September 2016 and operates as a retail managed investment scheme for people who could otherwise not afford to get into the property market. It works by offering fractions of a property, known as Bricks, rather than purchasing entire houses or apartments.
BRICKX recently put a Bondi Beach apartment on the market, giving investors the opportunity to access the lucrative Bondi property market for just $96.
Real estate expert and author George Astudillo told The Huffington Post Australia there are other ways to get into the property market, but you need to be aware of the pitfalls too.
“If we look at investing with friends or siblings, it’s usually one of those ‘It was a great idea at the time’ moments. Very few property partnerships work well, and there are several reasons why,” Astudillo said.
Co-investing with a sibling or friend
Risk tolerance: How people relate to risks varies from person to person. An investor with low tolerance to risk will need to be cautious and utilise a strategy based on security, while an investor with a higher tolerance to risk will be more aggressive with their choice of strategies. Finding someone that is compatible with your investment comfort zone is quite difficult and this difference in attitude will lead to friction. Be aware of your comfort zone, take a look at our blog “What is Your Risk Tolerance?”
Workload: Many partnerships become undone when one party does all the hard work. When it comes to investing in property there will always be decisions to be made. If one partner is always relied upon to make decisions, this can lead to resentments.
Affordability: All partners need to be able to afford not only the purchase of the property but also its ongoing maintenance and repairs. When renovating, can all parties afford the level of quality that will attract the appropriate tenant and rental?
“You also need to consider exit timing. Selling an investment property is all or nothing. If one partner needs to sell, there needs to be a plan for the other partners to buy that share or decide whether the property need to be sold,” Astudillo said.
Property Trusts
Property trusts are an easy way to buy into the property market indirectly. These are either known as Australian Real Estate Investment Trusts (A-REIT) which are listed on the Australian Securities Exchange or Unlisted Property Trusts.
“Before investing you need to know how each trust is managed as this is more like buying shares than property. You can also consider buying shares in a listed real estate company,” Astudillo said.
Rentvesting
When you can’t afford to buy a property you would be comfortable to live in, you buy a property as an investment.
“This way, you can then rent a property that is comfortable and rent out your investment, becoming both a landlord and a tenant,” Astudillo said.
“Rentvesting is probably the best of both worlds. It allows you to get into the property market without the inconveniences of living in a property that makes you unhappy.”
About Us
George Astudillo is the founder of Property Quarters, an agency that values communication and great relationships with its landlords.
George now has more than 30 years in real estate, including 15 years as the owner of a national real estate franchise. He’s also an accredited auctioneer and is the author of “The Landlord Mindset”, a book with his best tips to help landlords look after their investments. His book has been quoted in the SMH, The Huffington Post and The Age.
As the founder of Property Quarters, George takes great care in looking after his landlord’s investments. Having seen it all and worked with may landlords and tenants, he’s a strong mediator and negotiator and knows how to navigate through property legislation.
George is trusted by his landlords to advise on the financial management of their investments. He’s put in place proven processes to ensure each property he looks after is managed effectively to retain its value, quality tenants and rental income.
If you’re looking for a property manager who thinks like a landlord and whose business is built on tested processes, contact us by clicking HERE.
Copyright © 2022, www.propertyquarters.com.au
by George Astudillo | Jul 1, 2019 | Financial, Landlord mindset, Management Systems, Tenant
The right tenant is the corner stone of a successful investment property. This is where the rubber meets the road. The tenant can either make or break both your financial position and your spirit. Many property owners have already experienced the pain and frustration of a nightmare tenant which can potentially be 12 months of well.. hell.
The following are the three crucial qualities we need to identify and look for in a tenant to become the perfect match for your property,
1. Reliability – will they pay the rent on time?
Successful applicants will need to prove financial stability and a regular income. Without this your steady income stream is at serious risk. Once this has been established, avoid the burden of costs associated with rental arrears by ensuring your tenant has a long history of disciplined payments. After all you may be relying on this income to pay bills of your own, such as a mortgage.
2.Responsibility – will they look after the property?
A responsible tenant that will treat your property like their own are worth their weight in gold. Respect and diligence goes a long way, this means taking great care in the cleanliness and presentation of your property as well as reporting any maintenance concerns with effective communication. Remember: A clean tenant that takes care of their home and surroundings will be attracted to apply for a property that is in tiptop shape to begin with.
For more information on presenting your property to attract the right tenants see our previous blog “7 Easy Ways to present Your Property to Attract Great Tenants”
3.Co-operation – will they be co-operative in the event of an emergency?
An easy-going effective relationship between landlord/agent and tenant is essential. Emergencies will happen from time to time and prompt access to the property to carry out repairs or clean ups can save further damage and/or costs. A good tenant needs to be willing to communicate and be co-operative to find and implement a solution if necessary.
Having the right tenant will not only give you a good financial return but will also give you the peace of mind you are looking for. Take your time in choosing a quality tenant and don’t be afraid to go with your instincts on occasion, it is better for your property to remain empty for another week then to be occupied with a bad tenant that will be difficult to remove.
When you find ‘the one’ look after them and they will in turn look after your investment.
See our previous blog for the featured Landlord Checklist, a guide to a maintaining a happy tenant in “How to Keep a Great Tenant”.
About Us
George Astudillo is the founder of Property Quarters, an agency that values communication and great relationships with its landlords.
George now has more than 30 years in real estate, including 15 years as the owner of a national real estate franchise. He’s also an accredited auctioneer and is the author of “The Landlord Mindset”, a book with his best tips to help landlords look after their investments. His book has been quoted in the SMH, The Huffington Post and The Age.
As the founder of Property Quarters, George takes great care in looking after his landlord’s investments. Having seen it all and worked with may landlords and tenants, he’s a strong mediator and negotiator and knows how to navigate through property legislation.
George is trusted by his landlords to advise on the financial management of their investments. He’s put in place proven processes to ensure each property he looks after is managed effectively to retain its value, quality tenants and rental income.
If you’re looking for a property manager who thinks like a landlord and whose business is built on tested processes, contact us by clicking HERE.
Copyright © 2022, www.propertyquarters.com.au
by George Astudillo | Mar 21, 2019 | Financial, Landlord mindset, Planning
In today’s post I’m interviewing Theo Angelopoulos from ‘The Loans Analyst’ on mortgages, rates and offers from a property investor’s point of view.
Hi Theo, lets dive straight in, I have 8 key questions for you:
Q1. What are your thoughts on the current interest rate situation?
It’s the most competitive interest rate market ever; record low rates with potentially another rate cut by year end. To find the low rates you need to look outside the big 4 or negotiate with your bank for a better deal.
Q2. Is it a good time to ‘fix’ the interest rate?
Fixed rates are so low you may consider locking in a portion, but be careful when locking in rates as you do lose some flexibility. As an investor in a decreasing rate environment you should remain agile just in case you need to change lenders, either to fund the purchase of another investment property or get a better interest rate on your loans.
Q3. What are some of the indicators that rates are about to change?
The key indicators to track would be the inflation figures. If inflation remains low, another rate cut may be on the cards. Also keep an eye on property values, if there is a sudden surge in property values expect the RBA to slow it down by increasing rates, but I can’t see that happening anytime soon.
Q4. What is the most important thing to know about mortgages?
All banks are not created equal. Every bank has different credit policies, interest rates and appetite for investor loans. Last year we saw APRA impose tighter lending standards in order to slow down the growth in property investing. However, over the past couple of months, banks with a low exposure to property investors have changed their lending policies offering better incentives to increase their market share. This is why you need to shop around and review your property loans every 2 to 3 years. Rates and conditions change, what was good when you first took out your mortgage may not be the best for you now.
Q5. What are the main lending policies for investors to be aware of?
Recent changes to lending policies have made it more difficult for investors to grow their property portfolios. The main change has been around borrowing capacity. Investors with 2 to 3 properties are finding it difficult to buy the next property. The difference in borrowing capacity between lenders can be measured in the $100,000’s. Seeking the advice from a loan structuring expert is paramount. Investors are also paying higher interest rates for their loans compared to owner occupiers. And, if you are paying interest only, you may also notice a slightly higher interest rate.
Q6. Explain re-financing and who should consider it?
Refinancing is simply swapping your current property loan to another lender. Apart from increasing the size of the loan to buy another property, you would want to refinance to get a better deal. There are very competitive home loan deals at present and you could potentially save thousands of dollars by refinancing. If it’s been more than 2 years since you reviewed your home loan, you could be paying more than you should. Although there have been many interest rate cuts, not all of the banks have passed them on to their customers.
Q7. Can you share some special offers in the market at the moment?
If you’re a property investor looking to borrow no more than 80% of the value of the property and prepared to make principle and interest loan repayments, I have a couple of lenders offering extremely low rates looking for investors wanting to pay down their debt.
If you are an owner occupier with a home loan less than 80%, you are a PAYG employee (i.e. working for someone else) and have been with your employer for 12 months or more, then I know of one bank that is offering the lowest variable rate home loan I have ever seen. It also comes with 100% offset account, no application fees or annual fee for the life of the loan. It’s very popular and I’m not sure how long it will last.
Q8. What makes you different?
My smile and that I love helping people to buy property and create wealth through property investing.
About Theo
Theo is founder of “The Loans Analyst”. A premium mortgage broking business that has been helping clients to buy property and get a great deal on their home loan for over 10 years. Theo is passionate about property and a property investor himself. Theo is a member of Property Investment Professionals of Australia (PIPA) and full member of the Mortgage and Finance Association of Australia (MFAA). His office is located in the heart of the Sydney CBD and always happy to help aspiring property investors get into the market. Theo’s qualifications include Bachelor of Commerce degree, Advanced Diploma of Financial Planning and Diploma of Mortgage Broking.
For more information or to contact Theo, visit his website HERE.
Copyright © 2016, www.propertyquarters.com.au
by George Astudillo | Jan 15, 2019 | Financial, Landlord mindset, Legislation, Management Systems
The Residential Tenancy Amendment (Review) Bill 2018 has now been passed by Parliament.
The Bill has been designed to ensure the Residential Tenancies Act 2010 continues to protect both tenants and landlords. Whilst the Bill has been passed by Parliament, the next step is the development of the regulations, being the specific requirements for monitoring and enforcing the law. The regulations will also answer many of the questions raised by the Bill including the start date for the reforms.
What are the changes?
Minimum Standards
There are rules of what makes a property fit for living. These include:
- Property is to be structurally sound.
- Each room must have adequate lighting and electricity outlets
- Property must have electricity, gas or oil (dependant on availability), proper plumbing and drainage, ventilation and bathroom facilities in a separate room including toilet.
- All of the above-mentioned should be free of dampness/mould and in a good state of repair
Disclosure of information
If the property is a strata lot (ie apartment, townhouse, unit) a copy of the strata by-laws must be given to the tenant before they enter into a tenancy agreement.
Condition reports
Landlords and agents will have the option of giving the tenant either 2 copies of a written report or one electronic version on signing the tenancy agreement.
Landlords information statement
Landlords will need to sign a new form acknowledging that they know their rights and responsibilities as a landlord. The agent will need to have a signed hard copy of the document before they can sign a tenancy agreement on behalf of the landlord. This form has yet to be created.
Landlord’s remedies on abandonment
The break fee payable by a tenant on a fixed lease will change to,
- 4 weeks rent if less than ¼ of the lease has expired
- 3 weeks rent if more than a ¼ but less than a half of the term has expired
- 2 weeks rent if more than ½ but less than ¾ of the term has expired
- 1 weeks rent if more than ¾ of the lease has expired.
Termination notices for non-payment of rent or charges
The landlord will be able to issue a termination notice when a tenant has not paid rent, water usage or utility charges for more than 14 days.
Smoke Alarms
Landlords are fully responsible for Smoke Alarms. A tenant that carries out repairs to the smoke alarm, such as change of batteries, is entitled to be reimbursed.
Repairs/Alterations
Tenants will be allowed to make some changes to the property without needing to seek permission. A list will be included in the regulations.
Rent Increases
Tenants on a periodic tenancy agreement, i.e. where the fixed term has passed, can only be given one rent increase in any 12 month period.
Domestic Violence
Termination
If a tenant is the victim of domestic violence, they will be able to give notice to vacate the property effective immediately, even if the tenant is in a fixed lease, without penalty. A tenant would be considered a ‘domestic violence victim’ if they have a current DVO or they are co-tenant/ person related to the tenant with the DVO that lives on the premises. A tenant would also be eligible if they hold a declaration from a medical practitioner that states domestic violence.
Liability of tenant or co-tenant for actions of others
If domestic violence occurs on the premises and damage is done to the property as a result, the tenant, as the victim of domestic violence, will not be responsible for the cost of any repairs. Any co-tenants to the lease may also be exempted.
Marketing
If a tenanted rental property is due to be marketed for sale or lease, the agent has only one opportunity within the 28 day period before marketing begins to take interior photos. Tenants must be given fair notice to enable them to remove any personal effects they would not like presented in the photos.
A landlord will need written consent from the tenant to publish photos where any of the tenant’s possessions are visible. This consent cannot be unreasonably withheld unless under the circumstances of Domestic violence.
The new tenancy reforms create a greater need for Landlord Insurance. The changes to the break lease penalties could mean higher losses from tenant abandonment and the allowances to victims of domestic violence means that landlords will also become victims.
With the landlord becoming fully responsible for smoke alarms, it will be essential to use the services of a specialist smoke alarm inspection service.
As always, we will need to read the fine print once it has been written and released as law.
About Us
George Astudillo is the founder of Property Quarters, an agency that values communication and great relationships with its landlords.
George now has more than 30 years in real estate, including 15 years as the owner of a national real estate franchise. He’s also an accredited auctioneer and is the author of “The Landlord Mindset”, a book with his best tips to help landlords look after their investments. His book has been quoted in the SMH, The Huffington Post and The Age.
As the founder of Property Quarters, George takes great care in looking after his landlord’s investments. Having seen it all and worked with may landlords and tenants, he’s a strong mediator and negotiator and knows how to navigate through property legislation.
George is trusted by his landlords to advise on the financial management of their investments. He’s put in place proven processes to ensure each property he looks after is managed effectively to retain its value, quality tenants and rental income.
