Should I spend money on my Investment Property?

By June 22, 2017Uncategorized

Many owners have under performing properties simply because they are in need of improvement. Most of them already know this, though are fazed by the work involved.

Very often, we find that the very best investment return that Landlords can achieve is to improve their rundown property. It results in a much higher rental, being easier to rent, attracting a quality tenant, plus delivering a more saleable commodity as well. How would you like to achieve a 10% plus net return on a real estate investment?

Marriott Lane have formed relationships with contractors who can undertake cost-effective and timely renovations of kitchens and bathrooms, as well as the simpler jobs that result in a higher net return to the investor.

Improvements & Renovations

Current net rental returns are typically in the 3.5% to 4.5% range. A wisely spent $10,000 improvement can justify a $20.00 per week increase in rent. Therefore, the net return on this investment is 10%.

A renovation, say $50,000 for a new kitchen and bathroom in a tired two bedroom unit, can comfortably deliver more than a $120.00 per week rise in the rental amount, plus a valuable tax benefit through depreciation. Again, the return achieved on the $50,000 is considerably in excess of 10%.

Such improvements also increase the capital value of the property forever. Good Agents will report on the opportunity for improvements to your investment in order to maximize the ongoing and capital return.

Remember: The hardest properties to rent are the ones that are ‘rundown’.

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