Record low-interest rates have pushed more existing homeowners into the secondary homeownership market, according to data from FNB, which shows that the bank saw a 46% increase in the number of consumers purchasing secondary properties in the fourth quarter of 2020, compared to the fourth quarter of 2019.
In other words, an increasing number of existing homeowners now own more than one property for investment purposes, to let and generate regular income.
We all know that renting out your freestanding property is an excellent way to make an alternate income in a day and an age where one on its own simply isn’t enough.
Marcél du Toit, CEO of Leadhome Properties says that in order to maximise rental returns though, there are a few things you need to do to ensure that your property is ship-shape and ready for the rentals market.
Below, du Toit provides his top five essential tips to ensure that your property is fully prepared for the rental market.
- Conduct a property analysis
You’ve invested in real estate because you see a fruitful path to the bottom line. That’s why you’ve purchased the property you have. But in order to determine exactly how much money you CAN make from your home, you need to conduct an “investment property analysis.”
“This is a crucial step that helps you determine the critical metrics used to estimate probable returns on rental properties. Learning these metrics and using them to calculate your property’s potential value is the perfect starting point to achieving the maximum desired results.” Says du Toit.
- Evaluate your security
One of the most important aspects of a property, especially for South African residences, is whether or not its security is up to standard. You will find that a home that offers good security makes for a major rental point.
“Consider adding security measures like slam lock security gates and burglar bars on top of a security surveillance system like CCTV. Don’t skimp on access control either. The more safety features you implement the more valuable your property becomes” advises du Toit.
“Not only will good security measures protect your tenants, but they will also protect your investment even when not occupied.”
- Upgrade your interior
Everybody loves living in spaces that offer modern convenience. A stunning bathroom, a practical kitchen and a room for leisure is always top of the list. du Toit suggests that you invest in upgrading your property in order to keep it from looking outdated.
“You don’t need to redesign the home, but simply adding a few quality finishes here and there like new taps for the kitchen, or an upgraded shower for the bathroom, can really improve your rental investment.”
Simple, straightforward and with a design that appeals to everyone that won’t break the bank balance is a perfect place to start.
- Uplift your exterior
If you’re considering renting to a family with kids then having a welcoming outdoors area is paramount.
“A beautiful and enticing outdoor space is also important for attracting tenants from higher income brackets. Keep lawns well-maintained and ensure that the garden is neat and tidy. Trim hedges and overgrown trees and shrubs. “ says du Toit.
Do you have a pool on the property? Make sure that you have all the proper chemicals to keep it looking sparkling blue all-year-round.
- Focus on the details
“There’s not one house out there that doesn’t have at least one or two annoying little issues we pretend aren’t there. However, when looking to get the best returns for your rented property, you can’t afford to ignore them” says du Toit.
Homes that appear unmaintained send a message to tenants that you’re not likely to repair or maintain it in the future.
All you need to do is keep track of the items that need attention. Compile a written list and then attend to everything on it before even thinking about listing your property for rent.
Ensure that all of your improvements are durable in order to ensure a happy and long-term tenant.
“It is only natural to seek the best income return on your investment. If you’re willing to lease out your property then it’s wise to arm yourself with the knowledge necessary for keeping it spic and span, in order to achieve the best return on your rentals,” concludes du Toit.