Ready Tenanted Residential Properties- What are the risks when Investing?

Here are the advantages:

·Immediate Income and cash flow

·Don’t have to spend time, money and effort finding a tenant

·Your investment is already relatively secure

·You can focus on managing your property and maintaining a good professional relationship with tenant (www.Realrenta.com.au)

Here are the disadvantages:

·If the existing tenants are problematic, you are stuck with them until the lease expires

·If you want to undertake renovation and repairs, you are subject to the conditions of the existing lease and may have to pay compensation to the tenant, lack of access to property etc

·You may inherit a lease that is close to expiration or even tenants who are off lease, which means they can vacate with no notice and leave you back at square one, looking for tenants.


·Seek Legal Advice when checking the Lease

·Talk to the existing Property Manager and find out about the existing tenant

·Make sure you inspect the property beforehand

·Check the rental yields in your location and compare them to what you are considering

·Check if there are any other agreements in place, written and/or verbal as you may have to honor these.

·Make sure the bond is transferred properly so that it can be transferred to your name on settlement

·Question how often the property is inspected and make sure you are comfortable with the frequency and outcomes of each inspection.

·Compare the property condition report to your own observations.

·Investigate the performance of the Property Manager and consider DIY Property Management withwww.realrenta.com.au it’s the same as having a professional property manager but without the price tag.

·Do not buy an investment property just because it has a tenant.

Jason Gwerder
Friday, 1 April 2016

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