What to consider if you’re thinking of investing in rental property

If you’ve even glimpsed at the news or the current real estate market, you’ll know WA desperately needs more people to invest in rental properties. The rental housing crisis presents new opportunities for first-time investors, who are almost guaranteed to find tenants in an extremely short timeframe. Plus, you’ll be supporting people who are in desperate need of rental living — there are opportunities on all sides. 


However, that’s not to say you should jump in, guns blazing, and snap up the first property you see. Like any large investment, it’s vital that you do your research and know what lies ahead in your role as a property investor. 


 


1. Plan ahead. 

The property market is somewhat unpredictable. You need to make sure you can effectively manage (and survive!) periods of loss. At some point, you might be forced to lower your rent or have unexpected property repairs and maintenance (like a new retic system or air con unit). It’s also still up to you to pay council and water rates. And, despite a favourable renting market today, there may be times in the years ahead when your property is vacant. If it is, you’ll suddenly be down a passive income stream, but still have the mortgage repayments to make. 


2. Ask yourself, “why?”. 

Why do you want to invest in rental property? Perhaps it’s to maximise tax through negative gearing, you’re aiming for capital growth, or you like the idea of an additional income stream. If you think about it, the answer could affect the location and the type of property you buy. Let’s lay out a few examples. 


Additional income. 

Looking for additional income? You’ll want to ensure the rental income exceeds your loan repayments as well as all operating expenses (council and water rates, repairs and maintenance, that kind of thing). One way to ensure this is by putting a large deposit down on the property purchase to keep your mortgage relatively low. 


Capital growth. 

If, like many other investors, you want capital growth, be prepared for inevitable market fluctuations. Although the market is all over the place at the moment, property prices in WA were stable for several years before the pandemic hit. As a result, many investors had negative equity in their investment property. These investors have only recently been able to sell and break even or make a small profit, which is why so many investors are jumping ship and selling their properties. This is feeding into WA’s rental property crisis. 


Property development. 

Property development is a popular strategy for income creation. You’ll need to buy a property on a generously-sized block that allows subdivision. Always check this when buying a property — the real estate agent will know whether it’s eligible for subdivision, but you can also check yourself with the council. Sites like Reiwa also show property listings with the block size and zoning. 


3. Purchase to please. 

Even in this marketing, you’ll have trouble renting a property if it doesn’t appeal to tenants. Do a bit of research to find out what people are interested in. For example, let’s say you’re looking to buy a four-bedroom, two-bathroom house — this will most likely attract families. Is the property near (ideally, within walking distance to) good schools and parks? If you’re buying a one-by-one apartment, this will probably attract a single person or an established couple. Is there public transport nearby? Does the property include a parking bay and storage unit? 


It’ll help to speak to your local real estate agents and property managers; they’ll know exactly what people in their suburbs are seeking. 


4. Invest in professional management. 

You’re already investing so much in your property. It makes sense to do it all properly. That includes investing in professional property management. Property managers know the market well — it’s their job to. A good property manager will give you a heads-up when the market looks like it’ll shift, and can help you navigate those changes. They’ll also help you negotiate a fair rent with the tenants, and help you increase or lower it appropriately depending on market conditions. 


Your property manager will also be the middleman between you and your tenant, which means there’s far less direct communication for you (unless you want to do that). 


5. Finally, get expert advice before you buy. 

On top of real estate agents and property managers, it’s wise to talk to an accountant about your investment strategy. If you don’t have one, that’s even more reason to see an accountant. They’ll help you create an effective strategy, let you know what’s tax deductible, and also get a depreciation schedule prepared after you purchase a property. 


An accountant can also advise you on what name and tax structure you should buy the property in. Different tax structures have different benefits, and this is an area many investors aren’t aware of. The right tax structure for your circumstances can save a lot of tax when you decide to sell, and ensure you get the best tax advantage during the ownership of the property. 


When you’re ready to talk about entering the property investment market, we’ll help you get started on the right foot. Contact Ascent Accounting now to get started. 

Need help with your accounting?

Find Out What We Do

The 5% homebuyer deposit for first home buyers.

December 15, 2025
The Australian Government’s expanded 5% Deposit Scheme, which commenced on October 1, offers a fast-tracked path to home ownership for many aspiring buyers. By drastically reducing the deposit required and eliminating Lenders Mortgage Insurance (LMI), this program aims to unlock the door to your very own home sooner than ever thought possible. However, like any major economic policy, it has significant implications that buyers and taxpayers must consider. Here is a breakdown of how the scheme works, who qualifies, and what the potential impact could be on the property market. What is the 5% Deposit Scheme and how does it work? The scheme is designed to make home ownership more achievable, particularly for those struggling to save a 20% deposit. Low Deposit: The home buyer secures a loan with a minimum deposit of 5% (for First Home Buyers) or 2% (for single parents/legal guardians). Government Guarantee: Instead of the buyer paying LMI (which protects the lender), the Australian Government provides a guarantee to a Participating Lender. This guarantee allows the lender to provide a home loan covering up to 95% or 98% of the home's value without the usual LMI fee. No LMI: The buyer avoids paying Lenders Mortgage Insurance, significantly reducing upfront costs.  Key features of the expanded program include no income caps, as well as unlimited spots and no waiting list. The Scheme also makes a wider choice of home types available (houses, apartments, house/land packages, vacant land with a building contract, new or existing homes). It’s not just for first home buyers!

6 personal budgeting tips for Christmas.

December 15, 2025
Christmas can be the most wonderful time of the year—it can also be one of the most expensive. The key to enjoying the festive season and reducing the risk of financial stress is careful planning. As your financial partners at Ascent Accountants, we want you to focus on what truly matters—time with friends, family, and peace of mind. Six essential budgeting tips to help you take control of your Christmas spending. 1. Make a detailed budget list. The sooner you start, the more control you have. Begin by listing every expense you anticipate, including gifts, food, clothes, travel, and entertainment. Once you have your total, check it against your available funds. If the total feels too high, look at where you can cut back or spread the cost. Being realistic from the beginning prevents surprises later. 2. Prioritise what truly matters (and pay your priority debts!). When money is tight, focus your funds on the essentials and the things that genuinely bring the most joy. Order your list by priority (e.g., gifts for children first, then shared family meals, then travel). It’s okay—and essential—to say 'no' to extras that don’t fit your budget. Always consider your priority payments and debts before any other Christmas spending. Priority debts, like rent, electricity, or car insurance, must always come first as they significantly impact your day-to-day life if left unpaid. 3. Be cautious with credit and 'Buy Now, Pay Later' arrangements. It's tempting to use a credit card or a Buy Now, Pay Later option, especially when promotions promise delayed payments. However, small instalments add up quickly, and missing a payment can result in fees and/or negatively impact your credit record. If you do use credit, only borrow what you can comfortably afford to repay, and make a solid plan to pay it off as soon as possible in the new year. 4. Compare prices & shop smart. Always take time to research before you buy. Comparing online and in-store prices can result in significant savings. Be wary of high-pressure sales events like Black Friday, which often encourage impulse spending. Before purchasing, ask yourself three questions: Do I really need this? Is this on my original budget list, or is it extra? Is this truly a bargain if I don't actually need it? 5. Suggest a 'Secret Santa'. If your family or friend group has traditionally bought gifts for everyone, suggest switching to a Secret Santa arrangement. Setting a sensible spending limit or pooling funds for one thoughtful gift makes things easier and less expensive for everyone. Often, homemade gifts or vouchers for experiences are more meaningful and last longer in the memory than expensive presents. 6. Plan ahead for next year. The best way to guarantee a calm, affordable Christmas next year is to start preparing now. After this year's holidays, take note of exactly what you spent and where the money went. Set a goal for next year and start a small savings fund. Even setting aside $5 or $10 a week can make a monumental difference in managing next Christmas without stress. Need to tidy up your finances after the holidays? If the Christmas period leaves you needing advice on debt consolidation, setting up a savings plan, or just better budgeting habits for the new year, contact the team at Ascent Accountants. We can help you build the confidence to hit your financial goals!

FBT on Work Christmas Parties & Gifts

December 15, 2025
As the end of the year approaches, businesses are gearing up for the festive season, which means planning the annual Christmas party and showing appreciation with gifts. While the cheer is high, so too are the complexities of Fringe Benefits Tax (FBT). Getting the FBT treatment wrong can turn a simple celebration into an unexpected tax bill. As your trusted advisors at Ascent Accountants, here is a breakdown of the key tax rules, with a focus on the crucial $300 per person limit, to ensure your end-of-year generosity is tax-effective. The critical $300 minor benefit threshold. The Minor Benefits Exemption is your best friend for managing FBT. A benefit is generally exempt from FBT if its total notional taxable value is less than $300 (GST inclusive) per person, and it is provided infrequently and irregularly. Christmas parties (entertainment) The location and cost of your party are the key factors for FBT.

Burnout & mental health in a post-pandemic workplace.

November 12, 2025
Workplace stress affects mental health. Learn how employees and employers can prevent burnout and boost wellbeing and productivity.

Dealing with divorce; your property guide.

November 12, 2025
Divorce or separation is complex. Learn how to handle shared property, including the family home, investments, and SMSF assets.

Does your business need public liability insurance?

November 12, 2025
If your business interacts with the public in any way (from welcoming customers into your shop to visiting client sites) then public liability insurance isn’t just “nice to have.” It’s essential protection. Whether you’re a sole trader, a café owner, or running a construction company, public liability insurance helps safeguard your business against unexpected (and often costly) accidents. What Is public liability insurance? Public liability insurance covers your business if a member of the public suffers injury, death, or property damage as a result of your business activities. In simple terms, it’s there to protect you financially if something goes wrong—such as a customer slipping in your store, a tradie damaging a client’s property, or a product you sell causing harm. Without it, you could be personally liable for significant compensation and legal costs. What does it cover? A typical policy covers: Injury or death to a third party caused by your business operations. Damage to property belonging to someone else. Compensation and legal costs you’re ordered to pay following a covered claim. For example, if a customer trips over a cable in your office or a carpenter cracks a client’s TV while working onsite, public liability insurance steps in to cover the costs. What isn’t covered?  While every policy is different, public liability insurance usually won’t cover: Damage involving vehicles. Defective work. Breach of professional duty or negligence in advice (that’s covered by professional indemnity insurance). Defamation or advertising liability. Understanding these exclusions helps you choose the right combination of cover for your business. Who needs public liability insurance? If your business has any level of public interaction, you likely need it. Common examples include: Customer or supplier visits: If anyone comes to your premises or you work on theirs. Public events: Markets, expos, and pop-ups. Retail, trade, and construction: High public contact increases your risk. Leased premises: Many shopping centres and landlords require proof of cover. Contractor or license requirements: Many trade licenses (like electricians and plumbers) require it to operate. Even if it’s not legally required, most Australian businesses choose to have public liability insurance for peace of mind. How much cover do you need? The level of cover depends on your industry, business size, and risk exposure. Most businesses opt for between $5 million and $20 million. It’s worth reviewing your policy regularly, especially if your operations expand or you start working in new environments. Is it compulsory in Australia? Public liability insurance isn’t legally mandatory for all businesses, but some industries and licences make it a condition of operation. For example, in Queensland, electrical contractors must hold a minimum of $5 million in public and product liability cover. Similarly, councils or venue owners may require proof of insurance before approving an event or leasing a space. Don’t risk a law suit. Being sued for negligence can be financially devastating. Even a minor incident can mean you lose hundreds of thousands—not to mention the impact on your brand and business reputation. Public liability insurance ensures your business can keep operating, even when the unexpected happens. If you’re unsure whether your current cover is adequate, our team at Ascent Accountants can help you review your business risks and recommend the right level of protection for your situation. Contact us today to learn more.
More Posts