AUDIT PROTECTION

by Administrator 28. August 2014 19:15

With the Australian Taxation Office (ATO) crakcing down on investors, an insurance expert has suggested property managers could help landlords by paying property-related expenses such as rates and repairs directly.

RentCover landlord insurance general manager Sharon Fox-Slater said it was important for investors to make sure their affairs were in order given the highly complex tax rules around investment properties.

“Prevention is better than a cure when it comes to tax – investors need to keep accurate records and carefully research the deductions they are entitled to claim,” she said.

“If they do that, then audit should be quite straight forward.”

Ms Fox-Slater also suggested that property managers could help by encouraging landlords to allow them to pay property-related expenses such as rates and repairs directly.

“This can be a tremendous help when the landlord is preparing their tax, since it gives them an annual expense statement with most of the potential deductions recorded in one place,” she said.

Ms Fox-Slater said that investors with a number of investment properties, or those using unusual ownership structures, could consider taking out extra audit insurance.

Areas where the property investors can go wrong when it comes to tax time include confusing “repairs” with “improvements”, capital gains tax, combining travel to inspect properties with holidays, and claiming interest deductions for periods when the property is not available for rent, so it's important to get advice from a taxation specialist, according to RentCover.

“If the Australian Taxation Office comes calling on one of your landlords, it is worth reminding them to check their landlord insurance – some quality policies include cover for professional fees to help prepare for tax audit,” it said.

 

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SELECTION THE RIGHT TRADESPERSON

by Administrator 28. July 2014 23:13

It seems to be accepted that when appointing a contractor to do work on an investment property that the cheapest quote is always the best. This accepted rule of thumb couldn't be further from the truth.

We have found that the cheapest quote is not necessarily the best quote at all.

When appointing a contractor to do work on your investment property we take into consideration a host of factors determining contractor's suitability to do the work.

Other than price the following must also be taken into consideration:

- Is the contractor licensed to complete work for that trade?

- Is the contractor insured? If the contractor is not insured you carry the risk.

- Can the contractor provide references for similar work that he has completed?

- On work such as refurbishments, have you been given a start and completion timetable?

- Is the contractor going to complete the work himself, sub contact the job or oversee other employees to complete the work?

- Have you confirmed the materials used and any warranty periods applicable?

The above may seem a little over the top, but  all too often we  have seen investors appoint a contractor on price alone and ignore the host of variables to be taken into consideration when appointing a contractor most suitably qualified to do the work.

We always suggest to investors to take the time and care in appointing a contractor as you would appointing a contractor in your own home.

Although we may present a quote to you for work that may seem a little high in comparison to some, the above must be taken into account in order to protect your interests, the dollars invested and your property.

At M Residential, we ensure we have quality list of trades people covering all possibly works required.  To find out more, contact Laura Levisohn at M Residential.

 

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CONSIDER YOUR TENANT AS WELL AS YOUR INCOME

by Administrator 14. July 2014 21:55

Your property manager understands that a secure tenant equals a secure income. If your tenant is on a fixed term lease, they will feel secure and that feeling will often translate into a renewed lease when it comes time to extend that invitation.

Many people may never own their own home, either by choice or by circumstance, but feeling like the house that they rent is home will reward you, the landlord in two ways.

Firstly and most obviously with a regular rental income and secondly; a good and happy tenant will take good care of the property because it is their 'home'. 

If you have a good tenant, you might fall into the trap of allowing the lease to remain open ended after the fixed term expires because you don't want to 'confront' a good tenant with a new lease to sign. The fact of the matter is, the new lease will provide your tenant with the peace of mind of knowing that they will have somewhere to call home until that lease expires. 

Should you wish to enter into a new lease with your current tenant, we will ensure that the tenant is listened to and feels happy upon the signing of the new lease agreement and understands that by entering into a new fixed term lease we can guarantee them security of tenure for that term. 

Keep in mind that renewing the lease with your current tenant will save you fees and expenses as well as wear and tear that occurs when tenants vacate and move in to your investment property.

If you would like to discuss keeping your tenant on a fixed term lease or having M Residential manage your investments, contact Laura Levisohn.

 

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TOP TIPS WHEN CHOOSING A PROPERTY MANAGER

by Administrator 4. July 2014 01:48

Once you have found the investment property that you intend to purchase, there are many things that should be top of mind for every property investor.

When thinking of appointing a property manager to manage your property, many property investors initially thinks that fee is the first and main thing to take into consideration.

Of course, we are all price conscious these days and it would be unwise not to take your property manager's fees into consideration. However, when viewed in the context of the dollar value of the management fee annually compared with the sale value and capital appreciation of your property, a capable and professional property managers fees are a modest tax deductible expense.

All too often, property investors fall into the trap of appointing a low fee property manager with the thought that this is a saving. In fact it is false economy as there are a myriad of factors that must be considered when appointing a property manager. A low fee property manager may, at the end of the day cost you money through extended vacancy, the inability to train and be aware of industry trends and legalities and being unaware of how their actions impact your bottom line.

Before appointing a property manager, ensure these questions are answered:

  • Are they aware of prevailing market conditions and tailor lease terms to meet the peaks in the leasing cycle? A standard lease term my cost you dollars by ending at the bottom of the leasing cycle.

  • Has the property manager asked about your investment goals and expectations? A good property manager should be aware of your needs and expectations in your investment to reach its full potential for you.

  • What advice have you been given about compliance and legalities that are imposed upon property investors before they lease a property? Not being aware of your obligations can expose you to legal action and compensation.

  • How have they determined a market rent and how often are rents reviewed?

  • Have you been informed what may need to be done to the property so you can realise its full income earning potential? 


When appointing a property manager, don’t dwell on fees. Look and ask questions about how the property manager can maximise your income and minimise the expenses of your investment property.

If you are looking for the right property manager to manage your investment property/s, make sure you contact Laura Levisohn from M Residential.

 

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PROFESSIONAL MARKETING GETS YOUR PROPERTY LEASED

by Administrator 17. June 2014 01:40

When your property manager suggests professional marketing for your investment property take the advice for what it is.

As in the marketing of properties for sale in which well marketed properties sell quicker, the professional marketing of your investment property will capture the attention of quality tenants over the standard forms of rental marketing.

Professional marketing also assists in getting your property leased quicker and at a higher rental.

The additional marketing costs are soon recovered by a minimal vacancy period and the quality of tenant obtained as well as the rental level achieved.

Consider this option and reap the benefits.

To discuss having your investment property professionally marketed, contact Laura Levisohn of M Residential

 

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Understand the Benefits of Renewing Your Tenant's Lease

by Administrator 6. June 2014 20:05

Ensuring a continued tenancy is paramount in order for you to budget for regular and ongoing rental income. Not only this, but a tenant on a fixed term lease on an ongoing basis means more income, as the property will not become vacant or suffer additional wear and tear through the tenant vacating and a new tenant moving in.

 

We understand this and will, with your consent, approach your tenant prior to the lease expiring to invite them to renew the lease.

 

Should you wish to enter into a new lease with your current tenant, we will use all avenues to ensure that the lease is signed.

 

We will inform your tenant that by entering into a fixed term lease we can guarantee them security of tenure for that term, where if they remain on a periodic tenancy we cannot give that guarantee.

 

In some instances the offer of a moderate rent increase as against a higher one is another inducement that can be made to ensure that your tenant signs a lease and you have peace of mind.

 

To discuss this further, please contact Laura Levisohn at M Residential.

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Are you aware of the equity in your investment property?

by Administrator 28. May 2014 01:38

Many property investors are not aware of the current value of their property and as a result are unaware of the equity they hold in their property(s).

 

By utilising the equity that you have in your investment property, you may be able to purchase another investment property and in some instances with no or little additional out of pocket expenses.

 

Simply call M Residential and we can arrange a market appraisal and we may be able to assist you in growing your property investment portfolio through using the potential equity in your property.

 

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RENT REVIEWS - To Increase or Not To Increase?

by Administrator 20. May 2014 23:26

We understand that prompt and ongoing rent payments are the lifeblood of property investors.


We suggest that rent levels should be maintained at or slightly below market rent levels in order to keep pace with increasing costs and to ensure that the tenant does not vacate due to an above market rent increase.


When recommending a rent increase to you we take into account the nature in which the tenancy is being conducted, how the property compares with others that are presently on the market and ask, if the property became vacant today what rent would it realise?


There are times that we may recommend that the rent level remain unchanged due to market conditions.


We have found that the properties for which investors increase the rent to above market levels have higher vacancy levels than those who maintain rents at or slightly below market prices. Therefore, increasing rent to above market levels is false economy as it results in a higher turn over of tenants, high vacancy and lost income.


It is worth noting that tenants are better educated  today and are aware of the market rent for a given type of property in a given location. This information is readily available by simply navigating the various internet portal websites.


By increasing rents to slightly below market rent, your tenant is aware that they are not being rent gouged and are more likely to remain in the property. This ensures full occupancy for you and a continuing income stream.


Our job is to maximise the income for your investment property. We achieve this by not only increasing rents but by ensuring that you have a steady income stream and lower vacancy rates. Maintaining rents at or slightly below market level achieves both objectives.

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Getting A Third Quote Is NOT The Answer

by Administrator 6. May 2014 23:34

It is natural to obtain more than one quote when undertaking major work around the family home or investment property such as replacing a stove, repainting and re-carpeting.


In the majority of cases, most people obtain two quotes to ensure that the best deal is being obtained. All too often however, property investors call for a third quote.


We, at M Residential have found that a growing number of contractors are now charging for quotes (which is reasonable when 'bargain hunters' can waste their valuable time) and if successful are deducting the cost from the work invoice.


By calling for three quotes, property investors are delaying the repair or refurbishment which costs them more money again in the form of lost rent that could have been being collected in this time.


M Residential has a ready source of reliable, proven and trustworthy contractors who can provide quotes quickly, often at little or no cost (due to the ongoing relationship) and at a reasonable invoice price.                 


Avoid the three quote syndrome and save yourself money by enabling the work to be done sooner and your property to start earning an income.

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Leading Property Managers of Australia 2014 Awards for Excellence

by Administrator 1. May 2014 17:52

The winners have been announced for the LPMA 2014 Awards for Excellence. Local property management business M Residential has won the Best Property Management Website Award. 

LPMA is an elite group of professionals made up of the very best property management practitioners and companies. They are at the forefront of Australian property management practice, and their Awards are highly sought after.  By being announced as the winner, these firms and individuals are recognised as the very best in the property management industry.  They lead the way in professionalism, professional development and industry standards.

Bob Walters, Executive Director of LPMA said “All finalists in these Awards are of such a high standard that it was very difficult to separate the winners”.

“LPMA Members are governed by a Code of Practice and exemplify the highest levels of professionalism and innovation, therefore these Award winners are deserving the highest honour that we can bestow” Bob added.

The M Residential team are thrilled to have won this award, presented at the Leading Property Managers of Australia Gala Awards Dinner on Thursday 3 April 2014 at the Surfers Paradise Marriott Resort & Spa.

We would like to thank all of our wonderful clients, advertisers and subscribers, whose support and encouragement has brought us to where we are today.

We would also like to congratulate all of the other award winners and finalists on their amazing achievements.

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