1 January 2020

9 Ways to Increase Your Investment Property’s Rental Yield

Pat Carbone
Share

The average residential investment property in Australia has a rental yield of just 3%, according to SQM Research. With returns so low, holding property long-term can be expensive and difficult.

With that in mind, to help you get the best out of your investments, we’ve taken a closer look at nine quick and easy ways to increase your property’s rental yield.

1. ADD A BEDROOM

The same exact property with an extra bedroom will almost always rent for more. If it’s easy and affordable to do so, consider adding a bedroom by repurposing a second lounge or building an extension. If your property goes from two to three bedrooms you may also attract a different type of tenant, such as families.

2. CUT YOUR MAINTENANCE BILL

One of the easiest ways to cut your property’s expenses and increase your rental yield is to minimise the amount of maintenance required. For example, you could pave the backyard instead of grassing or planting it, or you could install newer fittings so that you will end up replacing them less often. Whatever you do, try not to hurt the house’s appeal when you make changes.

3. COSMETIC RENOVATIONS

Extensive and expensive renovations may not be worth the cost as they sometimes only result in a small improvement of your rental yield. Cosmetic renovations, on the other hand, can be cheap – or even free – and may increase the amount of rent you can charge. A new paint job, new carpet or even a fresh polish on wooden floors can make all the difference.

4. RENT BY THE ROOM

In big cities like Melbourne and Sydney, renting by the room to students and young professionals is becoming increasingly popular. This strategy may be risky and require more work but if you’re willing to try, it could allow you to charge more in your lease agreement.

5. RENT IT FURNISHED

Furnished properties usually rent for 10% to 20% more, depending on the quality of the furnishings. They may come with more costs, and the tenancies may be shorter term, but if you’ve got spare furniture this is a great way to increase your rental yield.

6. SET THE RENT HIGHER

The most straight forward way to increase your rental yield is to simply set your rent higher. If your property is unique, or rentals in the area are hard to come by, you may get lucky and lease the property out for more than you expected. However, if you set your rent too high you could struggle to find tenants, so talk to a quality local real estate agent before pricing your property.

7. REVIEW YOUR MORTGAGE

Mortgage interest and loan fees soak up most of the income from the majority of rental properties. Cut this expense by reviewing your mortgage with the help of a broker and you could instantly start making more from your property.

8. GET YOUR TAX POSITION SORTED

Many investors don’t claim all the tax deductions that they’re entitled to, so they end up paying more tax than they need to. Having a specialist property accountant prepare your tax return may seem expensive, but it could make you thousands in the long run.

9. CONSIDER SHORT-TERM RENTALS

Short-term rentals and holiday accommodation usually charge a higher per-night rate, and if the right property is managed well, they may achieve far higher rental yields. Keep in mind that renting your property this way may be riskier and comes with a higher chance of vacancies. But if you rent it out consistently, you could pull in more than you would with a traditional long-term lease.

Other Articles

  • 10 October 2019 - Adrian Atelj
    4 things first home buyers need to know
  • 9 October 2019 - Adrian Atelj
    4 tips for planning success when selling
  • 18 December 2019 - Vic Lorusso
    4 Tips to Consider When Selecting a Builder
  • 19 April 2022 - Danielle Redford
    Key questions to ask before buying a home
  • 15 December 2019 - Adrian Atelj
    8 Must Haves When Choosing A Rental Property
  • 19 April 2022 - Danielle Redford
    How to make a winning rental application
  • 16 October 2019 - Adrian Atelj
    8 tips for negotiating with selling agents
  • 7 October 2019 - Adrian Atelj
    A guide to buying at auction
  • 5 October 2019 - Vic Lorusso
    Adding a pool: will it add value?
  • 4 October 2019 - Adrian Atelj
    Are property managers worth the cost?
  • 24 November 2019 - Adrian Atelj
    Beginner’s Guide to Starting a Veggie Garden
  • 25 March 2022 - Danielle Redford
    Breaking a Lease with your Landlord Early
  • 18 April 2022 - Emma McLaren
    Understanding your home’s useable equity
  • 9 May 2022 - Danielle Redford
    How to flip property in Australia
  • 15 October 2019 - Adrian Atelj
    Gaining the mindset of a successful investor
  • 5 April 2022 - Danielle Redford
    Homeownership in 2022: Costs of Buying a House
  • 9 October 2019 - Vic Lorusso
    Hot interior styling trends for 2020
  • 12 March 2022 - Danielle Redford
    Your guide to different house types
  • 12 March 2022 - Danielle Redford
    Conveyancing: a cheat-sheet guide
  • 19 April 2022 - Emma McLaren
    How long does it take to build a new home?
  • 12 March 2022 - Danielle Redford
    How much deposit do you need to buy a home?
  • 9 May 2022 - Emma McLaren
    How much does a new kitchen cost?
  • 12 March 2022 - Danielle Redford
    What's the average cost to build a home in 2022?
  • 9 May 2022 - Danielle Redford
    The value of building an extra bedroom
  • 5 April 2022 - Danielle Redford
    How to make the most of negative gearing
  • 19 April 2022 - Emma McLaren
    How to buy property through private sale
  • 2 October 2019 - Adrian Atelj
    How to choose an investment property
  • 9 May 2022 - Danielle Redford
    How to determine the value of a home
  • 6 October 2019 - Adrian Atelj
    How to get your property ready for sale
  • 2 October 2019 - Adrian Atelj
    How to increase your return on investment
  • 5 April 2022 - Emma McLaren
    Stress-free interstate migration
  • 4 January 2020 - Adrian Atelj
    How to Negotiate a Lower Rent and Save Big
  • 24 December 2019 - Vic Lorusso
    How To Use Plants for Shade and Privacy
  • 28 November 2019 - Vic Lorusso
    Is a Low Deposit Loan Right for You?
  • 12 March 2022 - Danielle Redford
    Is It Worth Hiring a Buyer's Agent?
  • 7 October 2019 - Adrian Atelj
    How to style your home and wow your buyers!
  • 12 March 2022 - Danielle Redford
    Making an offer on a house in 2022
  • 16 October 2019 - Vic Lorusso
    Making the transition from rent to mortgage
  • 9 October 2019 - Adrian Atelj
    Market falling? Here’s what to do
  • 4 November 2019 - Vic Lorusso
    Mortgage Cashback: What’s the Catch?
  • 19 April 2022 - Emma McLaren
    How to negotiate a home purchase price
  • 15 October 2019 - Vic Lorusso
    Nine top tips for buying off the plan
  • 1 November 2019 - Adrian Atelj
    November Monthly Market Overview
  • 18 April 2022 - Emma McLaren
    Your Complete Pre-Settlement Checklist
  • 19 April 2022 - Danielle Redford
    How to prepare your home for the rental market
  • 24 December 2019 - Adrian Atelj
    Propagating Indoor House Plants with Water
  • 12 March 2022 - Danielle Redford
    Rent-to-own your own home schemes
  • 9 May 2022 - Danielle Redford
    Checklist for a rental inspection
  • 10 November 2019 - Adrian Atelj
    Storage Hacks for Babies and Toddlers
  • 25 March 2022 - Emma McLaren
    Using Super to Buy a Property
  • 19 April 2022 - Danielle Redford
    Essential tools for DIY home renovations
  • 16 October 2019 - Adrian Atelj
    The attraction of apartment living
  • 5 October 2019 - Pat Carbone
    The home buyer’s guide to stamp duty
  • 9 May 2022 - Danielle Redford
    How to carry out an end of lease cleaning
  • 14 October 2019 - Adrian Atelj
    Tips for keeping pets safe outside your home
  • 26 December 2019 - Adrian Atelj
    Top 10 Indoor House Plants
  • 3 October 2019 - Adrian Atelj
    Top tips for picking your ideal suburb
  • 19 April 2022 - Emma McLaren
    Which Property Type Should You Buy?
  • 9 May 2022 - Danielle Redford
    What you need to know about stamp duty
  • 19 April 2022 - Danielle Redford
    What’s the purpose of a sunset clause?
  • 10 October 2019 - Adrian Atelj
    Understanding supply and demand
  • 25 March 2022 - Emma McLaren
    What is a Granny Flat?
  • 9 May 2022 - Emma McLaren
    What is a private rental?
  • 19 April 2022 - Danielle Redford
    Buying a Property Under a Private Treaty Sale
  • 12 March 2022 - Danielle Redford
    Property Valuations and How They are Calculated
  • 14 October 2019 - Adrian Atelj
    What to look for when inspecting a property
  • 9 May 2022 - Emma McLaren
    A Guide to building a granny flat
  • 27 November 2019 - Pat Carbone
    When is the Best Time of Year to Sell?
  • 9 May 2022 - Danielle Redford
    I want to sell my home; where do I start?
  • 6 October 2019 - Vic Lorusso
    Which property costs are tax-deductible?
  • 10 October 2019 - Adrian Atelj
    Why selling your home is taking longer
  • 183 of 183 articles
    Copyright © 2021 Homes.com.au Limited. All rights reserved.