Did the salesperson say buy and forget when you bought your investment property?

Rental Income

Let me remind you that there is the possibility of three sources of income fro an investment property.

• 1. Rental return – which do you think brings in the better rental amount?
  • A well maintained property or one that is not?
• 2. Capital gains – which do you think goes up higher in value?
  • A well maintained property or one that is not?
• 3. Taxation benefits through negative gearing –
  • is maintenance part of your claimable costs?

Maintenance Plan

If you are serious about maximising the returns from your investment property then you need to have a maintenance plan. Your plan needs to have some money set aside each year to ensure that the required maintenance is done. Our property managers talk to landlords about short term and long term maintenance requirements for their properties.

Some items are mandatory in law e.g. Smoke detector checking and logs. We arrange for this to be done on behalf of the landlord.

Other items like painting the bathroom ceiling or refreshing internal painting of walls are done at the discretion of the landlord unless there is a health issue involved like mould.

Your List

Below is a list of possible items which may apply to your property. Decide what you think might be a reasonable frequency and do an estimate of cost. This will be the beginning of a plan. If you haven’t spent money for quite sometime then you really must face the fact that your time for expenses might be coming sooner rather than later. If your property is part of a strata development then the Owners Corporation may already have a Maintenance plan for common areas like the external walls and roof.

I live in a development with 68 units and each year we do some major work like painting one side of the building. We have a levy for this work on each of our fee notices. You need to be sending a levy to your self for the maintenance of inside the property if it is strata or the whole property if it is a house.

Possible items for inclusion in an Investment Property Maintenance Plan

• Smoke detectors – check and log
• Wet areas all still sealed properly – balconies, showers, taps, pipes, kitchen counters etc
• Gutters –  need to be cleared
• All the windows and doors should close and lock quietly and correctly
• Clean the filters, condenser, and evaporator coils in your heating and air conditioning units, and change the filters if necessary.
• Check the auto-reverse on garage door – we don’t want squashed children
• Check exhaust fans in kitchen and laundry are cleaned regularly
• There needs to be one undamaged insect screen in each bedroom
• Termites in your area?
• Check plant and tree growth – not out of hand, touching wires etc
• Blind cords are secured properly
• Internal and external painting
• Replacing floor coverings
• Decks resealed

And from your experience with your own home I am sure there are lots more things you will want to add to the list.

I would be interested in what % of the property value or % of rental return you have decided to set aside for your maintenance plan. Send me an email on toni@planinsek.com.