5 reasons why your property portfolio isn’t bringing results
Jumping into property investing is exciting. For many, it feels like the first big step toward financial freedom. But without a solid strategy, it’s easy to make decisions that don’t deliver the results you’re hoping for. Maybe you’ve bought a property and expected it to perform on autopilot, only to realise that it’s not bringing in the returns you envisioned.
The truth is, property investing isn’t just about buying and holding - it’s about buying the right properties and making strategic moves that keep your portfolio growing. If you’re finding your rental portfolio stuck or underperforming, here are five reasons why that might be happening - and how to fix them.
1. Lazy debt
"Lazy debt" happens when you’re not leveraging your existing equity or refinancing to grow your portfolio. For example, if you’ve built significant equity in a property but leave it sitting idle, you’re missing an opportunity to invest in another property or asset that could increase your returns.
The fix: Speak to your mortgage adviser about refinancing or restructuring your loans to free up cash for your next investment. Recycling your debt into new opportunities ensures your money is working as hard as you are.
2. You bought the wrong property
Not all properties are created equal, and buying the wrong one can seriously hold you back.
If your property is just like every other one on the street - same size, same layout, same look - you risk having its value and rental income dictated by what your neighbours do. Think a block of townhouses that look exactly the same - your value will be determined by your neighbours.
The fix: Differentiation is key. Properties that stand out (for the right reasons) tend to have higher demand and better long-term performance. Look for properties that have stand out features, maybe it’s a backyard, a large home or great parking.
3. No opportunity to add value
A shiny, fully renovated property might seem like a dream purchase - but it could limit your growth.
If there’s nothing left to improve, you’re relying entirely on the market for capital growth, which can be slow and unpredictable. Properties that allow for value-adding projects, like renovations or extensions, offer more control over their performance.
The fix: When adding to your portfolio, focus on properties with potential. Look for opportunities to renovate, subdivide, or enhance the property to increase its value and rental yield.
4. You’re holding onto an under-performing asset
Sometimes, the biggest obstacle is… you.
We all get attached to properties, but sentimentality shouldn’t come at the cost of your financial growth. If you’re holding onto an underperforming property because it’s your "first" or because selling feels daunting, you could be holding back your portfolio.
The fix: Be honest with yourself. Is this property helping or hindering your growth? If it’s the latter, it’s time to sell and reinvest in something that aligns with your goals.
5. Lack of land
The government is changing the rules to make adding value easier - but you’ll need land to benefit.
From next year, properties will be allowed to add a 60sqm minor dwelling without resource or building consent. This is a fantastic opportunity to increase rental income, but if your property doesn’t have a backyard or enough land, you’re out of luck.
The fix: When buying, always consider land size and future potential. Properties with space for minor dwellings or extensions give you more flexibility to adapt to market changes.
The bottom line
Your rental portfolio should be a growing, thriving investment - not a stagnant one. Whether it’s lazy debt, the wrong property, or missed opportunities, there are always steps you can take to turn things around.
Want to supercharge your investment portfolio? Book in a free 15-minute call with Ilse.