There’s so much to know about investing in property! We’ve already run you through the dos and don’ts when buying an investment property, so now that you’ve made the leap and secured your purchase, here are our tips to help you choose the best agent and ensure your continued success and safety when investing in residential real estate.



60 tips & tricks for investing in real estate

  1. After buying an investment property, don’t automatically give management to the agent you buy from. Check their credentials thoroughly. If in doubt, shop around.
  2. Possibly the worst way to choose an agent is by giving it to multiple agents and promising management to the first who finds a tenant. This encourages the agent to overlook potential problems with tenants to win the business. Disaster looms.
  3. Before hiring an agent, speak to several of their current landlords. Pick them yourself randomly from the agent’s client list.
  4. Ask these questions before employing an agent: ‘What is the average tenure of your current property managers?’ ‘When was the last time a property manager left your company?’ ‘Why?’ Stability in a property manager is a good indicator of the quality of that business.
  5. When employing an agent to manage a property, do your best to meet them in person.
  6. Before hiring an agent, confirm you won’t be held to the management agreement if they can’t rent the property. Simple rule – no tenant, no notice required.
  7. Pick an agent who promptly returns your calls. A same-day call-back is a minimum standard to expect.
  8. A good property manager may cost 1% more (often less than $5 a week), but it’s worth every cent when a bad agent may cost you thousands.
  9. Be careful of previous agents’ references for tenants. There is a chance they want to move them on. All applications should have multiple checkpoints that are cross-referenced.
  10. Don’t sign a management agreement with an agency that has a termination period of longer than 30 days.
  11. After you have chosen an agent, let them do their job. If you are uncomfortable with that, then you have chosen the wrong agent.
  12. Accompany your agent on at least one inspection. You should see your investment property every year.
  13. Have professional pest control completed the first time you rent out a property.
  14. Check your agent is not loading maintenance costs. What the job costs is what you should pay. Check your invoices against your agent’s statement.
  15. Make sure you have landlord protection insurance. Ensure it includes accidental damage – not just malicious damage.
  16. Remember, you are exchanging accommodation for money. Don’t get caught up in tearful tenant stories. No rent – no accommodation.
  17. Real estate businesses often sell their rent rolls. If this happens to you, the first time you will know about it is when you receive a letter from your new agency. It is perfectly legal and acceptable, and the same terms and conditions apply to your new agent as to the old. Hold them to it.
  18. Allow for two weeks of vacancy per year when doing the numbers on a potential property.
  19. Price your property to the market and get the pick of tenants. Although it may seem counterintuitive, it’s usually true that a cheaper rent attracts a better tenant. Overprice it and you attract tenants rejected by others.
  20. Do regular maintenance. A well-kept property costs less in the long run.
  21. Ensure your agent inspects your property four times a year. A lot can happen in three months. Many agents only inspect properties every four months, three times a year, which isn’t enough.
  22. Professionally clean your investment property for the initial lease. Future tenants are obligated to return it in the same condition upon exit.
  23. When looking for a tenant, don’t pay any costs for marketing. With online marketing, a good tenant can be found with minimal cost, a cost the agent should bear. Internet costs are spread across all properties an agent advertises. Don’t pay for a specific ad; agents don’t.
  24. Never let keys be handed out to potential tenants. Inspections should always be carried out with the agent.
  25. Have your gutters cleaned annually.
  26. Pets should be kept outside. Animal smells within a house are difficult to remove.
  27. Don’t allow tenants to smoke inside. The smell of smoke can only be removed by repainting and re-carpeting.
  28. If there is a pool, have it regularly serviced. Add a few dollars to the rent to help cover the cost.
  29. Your property management agreement with an agent is an asset to their business. Make sure you are receiving the service that reflects.
  30. Remember, people judge properties the same as they judge people. First impressions count.
  31. Don’t pay extra to your agent for financial year statements.
  32. After purchasing a new investment, allow surplus funds for go-wrongs. It’s amazing how many owners need new hot water systems within months. Houses seem to know they have a new owner!
  33. Trust is imperative with your property manager. Do you instinctively trust yours to do the right thing?
  34. If your property is vacant after ten days, reduce the rental price. Instant feedback on price is now available due to online marketing.
  35. If you property is not renting, reduce the rent by $10 a week. Remember, one vacant week at $400 takes 40 weeks at $390 to make up the loss. A $10 reduction in advertising rent can make a huge difference to potential tenants.
  36. When considering selling an investment property, instruct the agent to keep the tenancy on a periodic lease. A fixed term lease may keep the tenant in place but it makes the property much harder to sell.
  37. Homes are difficult to sell with bad tenants in place. If possible, wait, move the tenant on and then spend a small amount and some elbow grease cleaning up. It will help your sale greatly.
  38. Ensure your agent includes photos in their routine reports.
  39. If you decide to rent to friends or relatives, consider using an agent. If something goes wrong, it’s nice to have a middle person to deal with. Good friends don’t always make good tenants.
  40. Don’t pay for routine inspections, it should be included in management fees.
  41. Remember, the agent works for you, the owner. They should always represent your best interests. After all, you’re the one paying them.
  42. Beware of hidden costs in an agency’s agreement. The percentage for management may be cheaper, but overall they may be dearer.
  43. If you selected the wrong agent, you may not know it for years. Poor agents don’t reveal their true colour until a poor tenant tests them.
  44. Tenants get lots of free advice and information. Make sure you also get good advice and information from the agent you are paying.
  45. Got a good tenant? Then take it easy on the rent increases. Long-run returns are far better with stable, long-term tenants looking after your property.
  46. If you are selling with a tenant in place, offer them compensation to keep the property neat and tidy and to ensure they allow easy access. Maybe a reduced rent?
  47. Make sure the agent puts up a sign at the property to market for tenants. It is a silent salesperson, on duty 24 hours a day. Neighbours may know of someone. Many prospective tenants still drive around the area.
  48. Have a tax depreciation schedule done. This often makes a significant difference to your tax obligations at the end of the year.
  49. Change agents if you property management doesn’t return calls.
  50. Get everything in writing with you property manager.
  51. Take the time to select the right tenant, not the first tenant.
  52. What’s the difference between a maintenance expense and a capital expense? Maintenance expenses can be immediately claimed against income. Capital expenses may be depreciated over time.
  53. If you discover your property manager has lied to you, terminate their services immediately.
  54. Check your monthly statement carefully. Ask your agent for clarification if needed.
  55. Make the decision when you want to sell an investment property. Don’t leave it until you have to sell.
  56. Choose a good agency to manage your property, not a good individual. Even good property managers shifts jobs. If you choose an individual, there is no guarantee they will be looking after your property over the long term. Choose an excellent agency and there will be continuity for you and the tenant.
  57. If you agent hides behind the ‘email wall,’ be wary. Good agents call, then email.
  58. Every cent counts when investing. One of the hidden advantages of an agent is that all expenses and outgoings are automatically recorded for your tax purposes.
  59. Residential property management is governed by various state government acts and regulations. The benefit of a good agent is that they, not you, are responsible for upholding the law on your behalf.
  60. The more you learn, the more you earn. Keep studying and learning the skills of property investment. The same as with any endeavour, you will become better at it. Knowledge is power in property investment. You can never do too much research.