How is potential rent determined?
Even though the vacancy rate in Bundaberg is extremely low and there are more tenants than properties available, doesn’t mean you can set your rent too high.
To work out the cost, calculate what the property will actually cost you. Subtract your expected monthly mortgage payment, taxes divided by 12 months, insurance costs divided by 12, and a generous allowance for maintenance and repairs.
Don't underestimate the costs to maintain the property. These expenses depend on the property's age and how much upkeep you plan to do yourself. A newer building probably will require less work than an older one.
Always make sure any repairs are completed by a builder/maintenance company who is registered and holds and ABN, don’t try to do your own repairs, just to cut costs.
Don't forget to pay for insurance. Rental insurance covers a tenant's belongings, but the building itself is the landlords responsibility, and the insurance may be more expensive than for a similar owner-occupied home. The property's mortgage interest, insurance, and depreciation are all tax-deductible up to a certain amount.
All these factors come into play when determining the potential rent for a property.
This is where our Property Management team at First National Real Estate McColms can help you.