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The main difference between a tenantable property and other investments (such as term deposit savings or shares) is that you can often influence the rate of return on a rental property. How? By transforming it from basic to the next level, style-wise. It could mean both higher rent and a shorter time standing empty between tenants.
To you, it’s an investment; to your tenants, it will be their home. Would you like to live there? What would you change or spruce up? Does it look appealing, clean and fresh? Is everything in the best condition, with no insect marks, plaster cracks, worn carpet, grubby grout or scuffed paintwork? Make a list and a plan of action to fix any issues.
A smart front entrance will convey that the property is well looked after. With a house or townhouse, make sure paths and garden beds are free from weeds, the shrubs are trimmed, the lawn mowed and decks swept. Replace any straggly, overgrown or dead plants with low-maintenance alternatives. Clean or repaint the front door, replace old hardware and add a new doormat. For an apartment, check the common areas are as neat and clean as possible, and consider adding an inexpensive artwork beside the front door.
Tip: Use 3M hangers to avoid putting holes in the wall.
A property that smells fresh and looks clean is a winner. The devil is in the detail – think sparkling stainless steel, a shining shower screen, spotless window and door tracks, new sealant and grout, and immaculate blinds and flooring.
Go for practical finishes that will need less refreshing and maintenance down the track, such as washable paint. Choose a neutral shade you can use everywhere and keep some on hand for touch-ups. If possible, avoid carpet, which will quickly show wear. Hard floors such as timber or good quality laminate are easier to keep clean and maintain, with the added benefit that tenants can bring in rugs to put their own (impermanent) mark on the place.
Tip: Look for products with noise reduction properties, especially for apartments.
A stylish, modern kitchen is a big drawcard. If your budget won’t stretch to a renovation, replacing cabinet doors, handles and the benchtop can all lift the look, as can repainting walls and adding a new mixer tap. If the appliances are old, have them replaced.
Tip: Where possible, include a dishwasher: a 45cm model doesn’t take up a lot of room if space is limited.
A chic, clean bathroom has immediate impact. There are specialist paints that will let you transform tiles and the vanity, so if the space is in good repair but just in need of an update, this could be the way to go.
If the bathroom needs a more thorough upgrade, consider calling in the professionals for a full makeover – leaving the plumbing where it is will save on costs. For timeless appeal, stick with chrome fittings.
Tip: Opt for a shower screen over curtains – it looks more modern and will be easier to keep clean.
Don’t stint on built-ins. Tenants are unlikely to be dragging bulky wardrobes from place to place, so a rental with lots of clothes and linen storage will help maximise its appeal.
No-one wants to live in a goldfish bowl, so select window coverings that fit the purpose and are easy to keep clean and maintain, such as roller blinds. Floor-to-ceiling shutters are a good choice for a home that overlooks the street, as the lower section can be closed for privacy and the top left open to let in light.
Tip: Curtains are best avoided: they’re more difficult to keep clean and tend to retain cooking smells.
Good artificial lighting is worth the investment – nothing says cheap like a dim and dusty bulb. Call a sparkie to install simple but stylish fittings, illuminated with LEDs that won’t need frequent replacement.
Tip: A thoughtful extra touch for houses is motion-activated lighting for the entrance, driveway and bin areas.
Stylish accessories instantly lift the look. Where possible, replace yellowing plastic fittings and consider adding new plate covers for power points. Upgrade the toilet seat and fit a new, contemporary showerhead. Think about replacing cheap internal doors and/or swapping out old door handles for handsome new ones.
Landlords can claim some repair and maintenance expenses as a tax deduction. As a rough guide, you can claim for wear and tear that arises from the property being tenanted and to keep it in a tenantable condition.
Depending on what’s being done will determine when you can claim it. For example, repainting walls or fixing a broken window can be claimed in the year the work is done. Replacing a stove can be claimed over time as it’s considered a depreciating asset. If you do renovations like adding a carport, you need to wait until you finish the renovations to claim a capital works deduction for the construction expenses over time (generally 40 years).
When you sell the property, what you have spent on capital works and the deductions you have claimed for it will be used to calculate your capital gains tax. The important thing is to keep receipts and records of what you spend on your property. Have a look at the Repairs, maintenance and capital expenditure factsheet for guidance; it’s part of the investors toolkit on the Australian Tax Office (ATO) website.
*This information is of a general nature only and should not be regarded as financial or legal advice. It does not take into account your individual circumstances or objectives. You should always seek advice from a suitably qualified professional.
Check out our guide to make your home energy efficient.
Photo Credit: Getty Images, Anna Robinson, Cath Muscat, Sue Stubbs
Asbestos, lead-based paints and copper chromium arsenic (CCA) treated timber are health hazards you need to look out for when renovating older homes. These substances can easily be disturbed when renovating and exposure to them can cause a range of life-threatening diseases and conditions including cancer. For information on the dangers of asbestos, lead-based paint and CCA treated timber and tips for dealing with these materials contact your local council's Environmental Health Officer or visit our Health & Safety page.
When following our advice in our D.I.Y. videos, make sure you use all equipment, including PPE, safely by following the manufacturer’s instructions. Check that the equipment is suitable for the task and that PPE fits properly. If you are unsure, hire an expert to do the job or talk to a Bunnings Team Member.
