Repairs and maintenance expenses are a fact of life for both property investors and owner-occupiers. But they are arguably more important for property investors. Read on to find out 4 key benefits of being proactive rather than reactive with your investment property maintenance.
Key benefit #1: It helps you to maximise ROI
Proactive repair and maintenance work helps to ensure:
- You can charge the maximum market rent rate for your property. For example, realestate.com.au figures verify that our Purple Cow property management team achieves market rents for our landlord clients that are an average of 11% higher than competing agents.
- The value of your investment property is maximised if or when you want to sell.
Key benefit #2: It helps you both attract and retain high-quality tenants
It’s no secret that we’re in a rental accommodation supply crisis at the moment. Like in most parts of Australia, vacancy rates in the Greater Springfield area are at record lows, with most suburbs at 1% or less.
But that doesn’t mean you should become complacent as a landlord about property repairs and maintenance for two reasons:
- Maximising your ROI means attracting high-quality tenants who will always pay their rent on time and treat your property as if it were their own. Not all tenants are high-quality tenants, particularly in a cost-of-living crisis! Our Purple Cow property management team can help you to source and screen them. On average, we generate 26% more potential tenant enquiries for our rental property listings.
- Maximising your ROI also means keeping your high-quality tenants once you have them. A simple way to do this is by being proactive with property repairs and maintenance. This will help to keep your high-quality tenants happy so they will renew their lease when it ends. It avoids both the cost of sourcing new tenants and the risk that replacement tenants won’t be high-quality.
It’s also important to remember that tenant expectations about timely property maintenance are especially high in the current property market. Rent rates have risen significantly in recent years due to the housing supply crisis, and tenant expectations have risen with them.
Key benefit #3: It saves you money in the long run
Any minor repairs and maintenance issues that you may have now will probably only get worse and cost you more to fix in the long run. Think of any repairs and maintenance costs now as long-term cost savings.
Tradie costs are also unlikely to go down because there is a shortage of them and they have plenty of work. That situation won’t change while we have a housing supply crisis and booming population growth.
Key benefit #4: Repairs and maintenance costs are immediately tax-deductible
This is a big and important difference between investment property repairs and maintenance costs and property improvement costs. Repairs and maintenance costs (like painting) can be fully claimed as tax deductions in the financial year they are incurred.
Capital improvement costs on the other hand (like renovating by adding a room or patio) must be deducted at just 2.5% per year over 40 years.
It’s important to understand the difference between these two costs. Repairs and maintenance work either restores the property to its original condition or helps to prevent its deterioration over time. Capital improvement work involves making substantial or structural improvements to the property.
How we help our landlords maximise their ROI at Purple Cow
Our experienced property management team is proactive in helping to facilitate timely property repairs and maintenance for our landlord clients. We also help our clients to maximise their ROI on well-maintained investment properties via our Purple Cow 90-day pre-lease renewal process.
This process leverages the fact that you are only legally allowed to have one rent increase per year on your property when you are a Queensland landlord. So, we help our clients to make the most of that once-a-year opportunity by proactively sourcing the latest rental yield data on comparable properties in the area. We can negotiate to get the maximum rental increases for our landlord clients whose properties are well-maintained via timely repairs and maintenance.
If you have an investment property in the Greater Springfield area or further afield in Brisbane, we would love to manage it for you. Or if you are keen to buy one, we can help you to find the right property and tenants to maximise your return.
Contact us today to find out how we can help you.
