All about rental appraisals: what they are and why you should have one
In a constantly evolving market, knowing how best to position your rental property can be confusing. Regular rental appraisals by a qualified, trusted property manager are the best way to optimise your investment property and make sure you are getting the best possible returns.
Here, we talk you through the rental appraisal process and explain why having regular appraisals is so important.
What is a rental appraisal?
Rental appraisals are normally carried out by qualified property managers. They have wide experience in the rental market and are able to accurately assess the key features, appeal and earning potential of your investment property.
There are two main phases to a rental appraisal: assessing the property and researching the market.
Assessing the property
Your appraiser will consider the location of your property and assess how convenient it is for potential tenants in terms of accessibility, proximity to public transport and other local amenities, and its school catchment area.
They will also consider the size of the property, including the number of bedrooms and bathrooms, whether it has a balcony or a garden, and what other amenities it has that could appeal to potential tenants.
An important aspect of an appraisal is assessing the condition of any fixtures or fittings throughout the property. Some may need updating, adding or removing to boost tenant-appeal and rental yield.
By checking the overall condition of the property, your appraiser will also be able to identify any problems or areas that may need a little improvement to boost your earnings, basing their advice on current rental trends and tenant preferences in your area.
Researching the market
Top-performing property managers will always have their fingers on the pulse of the local and wider rental markets. This means that they have the data and know-how to compare your property with other similar rentals, research current market conditions and trends, and access up-to-date data to provide you with a realistic rental price guide for your property.
Once they have compiled all the information, they will provide you with an informed, realistic picture of the potential earning power of your property and will help you establish an achievable, optimised rental yield.
They will also ask you about your property goals and recommend marketing strategies to attract and retain the best possible tenants for your property.
What are the benefits of having regular rental appraisals?
An initial appraisal will help guide you when it comes to setting an achievable, optimum rental price for your property, but regular appraisals can help investors in several other ways, especially in rapidly changing market conditions.
Condition & compliance Having your investment property appraised regularly will help you stay on top of any issues that might come up and need seeing to. This includes general maintenance and condition as well as compliance with current regulations and tenancy laws.
Tracking value By having regular appraisals, you will also be able to track the value of your property and analyse how it performs over longer periods. This is an important part of managing any investment.
Real data-driven information Having the right information can make all the difference when it comes to making decisions about your investment property. A qualified agent has the right market knowledge and will dedicate the time to doing the required research so that you can make savvy decisions about your property.
Fit for potential sale Although you are currently renting your property out, regular appraisals will help you keep your property in top shape so that when the time comes to sell, you are ahead of the game in terms of maintenance and appeal.
Summing up
An initial rental appraisal is essential for any property investor, and regular ongoing appraisals are an excellent way to stay on top of your investment and make sure that it is always working its hardest for you.
The best news is that DiJones offers free, detailed rental appraisals to identify the unique benefits of your property and help you maximise the earning potential of your investment.
Other buying, selling and investing articles and resources
Guide to property investment success in NSW
Selling a house or apartment in NSW eBook
Buying a house or apartment in NSW eBook
