Managing and growing your assets

Investing in the right property is a great start. You also need to make sure your property is properly managed, and that your assets are insured.

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Maximise your tax advantages

Using negative gearing

A property is "negatively geared" when your costs of owning it are greater than the income you make from it. These costs could include your home loan interest, maintenance or repair costs, and capital depreciation. Negative gearing produces a "book loss" which you can offset against your other income, reducing the tax you pay.

But there is some risk. Negative gearing relies on the value of your investment property increasing. You need to be able to manage if your property loses value or if interest rates rise. To better understand negative gearing, depreciation, and capital gains tax, we suggest you get independent professional advice.

Making the most of tax

You will reduce the tax payable when you are entitled to deduct a range of expenses from your investment income, including:

  • loan interest payments
  • body corporate fees
  • land tax
  • local government and water rates
  • garden and property maintenance
  • cost of advertising for tenants.

You can only deduct expenses when your property is being rented, or is available for rent. Your deductions have to be expenses, not capital costs like renovations. You can learn more from the Australian Tax Office website which includes a number of publications on negative gearing – www.ato.gov.au

Managing your property

Successful property management keeps your tenants happy and looks after your property. You can manage your property yourself, or have a real estate agent do it for you. Managing your own property can be cheaper, but also complex and time-consuming.

A property manager's job may include:

  • managing tenants – finding and selecting them, and handling their complaints
  • looking after rent – knowing how much to charge, reviewing and renegotiating rent, collecting payments and keeping statements, and managing tenants that pay late (or don't pay at all)
  • property maintenance – conducting regular property inspections and condition reports, organising repairs, and finding suitable tradespeople like plumbers and electricians
  • fulfilling legal obligations – knowing current tenancy laws, and overseeing bond payments.

Insuring your assets

Insuring your property helps keep your investment safe. We offer a range of insurance that could suit you.

If you include your home loan in a NAB Choice Package or take out a NAB Portfolio Facility, we'll discount the premium you pay for some of our insurance products.