Make your investment a green venture

There are significant advantages for tenants and investors in rental properties, who choose to undertake eco-friendly renovations – it just takes a bit more of a broader view to see the potential value.

Benefits to tenants

It’s no secret that as well as being kind to the environment, eco-friendly housing is a lot kinder on the resident’s pocket. Property residents can save hundreds if not thousands from:

• Reduced water consumption.
• Less electricity used for temperature control.
• Reduced gas consumption on water heating.

And you don’t need to spend lots of money either – even small changes can produce big savings, such as:

• Low voltage light bulbs.
• Energy efficient appliances.
• Water filters.
• Block-out blinds.

Keeping tenants happy

Bad tenants who neglect or actively abuse a property, fail to pay rent on time – or simply don’t stick around for long – can really put a dent in investment returns.

Repairs, additional maintenance, pest control, leasing and advertising costs, plus lost earnings from a vacant property can quickly add up. Plus, a poorly maintained rental property can also have reduced value for use in funding other investments.

As such, happy tenants are a major benefit for investors. They are more likely to look after your property and pay their rent on time, and be eager to stay longer term. And what tenant wouldn’t be happy living in a property that saves them big bucks on energy costs.

Return on investment

There is increasing debate about whether energy efficiency improvements will realise a profit come sale time.

Some improvements will benefit you directly – think about improved natural ventilation and light reducing or even eliminating the effects of damp. Others may have a less tangible return, however selling an energy efficient property can only boost its appeal among buyers, which in turn could net you a higher return.

However, even before it comes time to sell your investment, your green improvements may actually net you a return through higher rents. Because of the monetary savings your energy efficient home affords your tenants, they may be more willing to splash a bit of that extra cash on higher rental payments.

So before you dismiss the idea of improving the energy efficiency of your investment property, take a broader view of the appeal of these measures among tenants and buyers, then re-evaluate whether it may be in your interest, as well as the environment’s, to go green.