Shifting from being an owner-occupier to a rental property investor is definitely an exciting journey as you would be able to build a portfolio, secure your family’s financial future and even fund your retirement.

But what associates is the headache that every landlord would have – managing your rental property, which entails tenant relations, maintenance and repairs, and financial management.

However, if you are able to navigate through the journey with the right strategy, owning a rental property is still worth the headache and it can yield a very rewarding return.

Here’s a few tips to help you succeed in rental property investment:

1. Set a reasonable and realistic rent

The first thing you need to do is to set a reasonable and realistic rent for your property based on the local market conditions.

You can check the similar rental listings online to see how much other landlords are charging for their properties.

The easiest way to get this done is to consult registered property agents who specialise in the neighbourhood. They will be able to provide professional and up-to-date insights on the local property market that help you to determine a fair rent that could attract tenants while making sure the rental returns are reasonable.

2. Finding the right tenant

Now it is time for you to start looking for a reliable and responsible tenant who will rent your property long term.

This is crucial to your property investment as a good tenant not only provides you an ongoing income stream but also a caretaker who will look after your property. This will make sure that your investment and rental return are well-secured.

In order to get the best tenant that you could find in the neighbourhood, you should always conduct a background and credit check, which involves asking about their occupation, monthly household income and reasons for moving to the area.

Again, you can get registered property agents to help you with the process as they are able to provide you a more qualified pool of prospective tenants to choose from.

3. Have a proper tenancy agreement

Having a proper tenancy agreement and understanding the terms and conditions are equally crucial in ensuring the success of your rental property investment.

Other than property details and rental amount, important items to include in a tenancy agreement are clear statements about landlord’s responsibilities, tenant’s obligations, house rules and how to solve disputes.

4. Get ready to deal with problems

Be prepared for problems and deal with them carefully and effectively is the next step to ensure the success of your investment.

There could be all sorts of issues, which includes late rental payment, disagreements with neighbours and maintenance and repair requests.

But there is no need to get stressed or overwhelmed as before you and your tenant sign the tenancy agreement, you should already have a plan in place for how to deal with these circumstances. 

On top of that, you should consider adopting preventive measures such as setting aside a portion of the rental income every month as a “sinking fund” to cover future maintenance and repair on the property.

5. Keep records

Last but not least, you should pay extra attention to record keeping, which includes the original tenancy agreement, payment logs, and receipts and documentation for expenses you incur for the property.

You should also conduct a move-in and move-out inspection and take photos of the property’s condition.

This is important to avoid any discrimination claims, prevent misunderstandings about the property’s condition, and for various other purposes that may arise.