Perth’s recent property boom was largely fuelled by sudden population growth, but there were also many keen investors eager to try their hand in the property market, many of whom were entering the rental property sector for the first time.

Owning an investment property is like running a small business. There are risks and rewards and the need to maintain good records for administrative and taxation purposes.

Property investors enjoy total control over their investment, unlike many other forms of investments which are determined by unknown persons. This is one of the reasons property investment remains popular. However, this also means that the property investor is more responsible for the performance of their investment.

The biggest mistake many property investors make is not keeping up with regular maintenance. In the long run this is counterproductive. Such properties will not increase in value as much as others, rental income will be lower and tenants are less likely to respect the property.

The best way that property investors can minimize ongoing expenditure is, initially, to purchase lower maintenance properties that are structurally sound. Of course, even the best investment properties need occasional maintenance. Many of these costs are tax deductible so over time the investor is rewarded by higher returns.

Property owners dread the prospect of a tenant who damages the property, but thankfully this is rare. One of the best ways to avoid this from happening is to ensure the property is in top condition. Most tenants will keep a property in the condition they find it. It’s about mutual respect, and happy tenants are more likely to stay in a place longer; a desirable outcome for owners.

REIWA recommends employing a property manager as an important way to protect your asset. Apart from finding tenants, collecting rentals and seeing to the administration of your property, a property manager can access industry databases to see if a prospective tenant has a history of non-payments or property damage.

Just over 50 per cent of all rental properties are managed professionally, meaning that investors who use this service can achieve a competitive advantage over properties managed privately, particularly in the selection of tenants and care of the properties.

Property management fees are fully tax deductible, which makes them more attractive, particularly for those people who lead busy work and family lives and who would rather not have to deal with the day to day issues of finding the right tenants, arranging the lease, collecting the rent, home inspections, and responding to maintenance requests.

For those who are new to owning investment properties, REIWA recommends professional property management, along with starting a maintenance fund by regularly setting aside small amounts of money to meet occasional needs.

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