Are Serviced Apartments a Good Investment?
Many people would like to invest into property, but just don’t know where to start… Do you buy a house, a flat, or even go as big as to buy an HMO?
One option that most people never consider is buying a property in order to make it a Serviced Apartment. You may be surprised at the HUGE increase in your annual ROI vs a traditional family let property…
Serviced Accommodation is the latest trend in the property investment sector right now and growing at a RAPID rate not just in the UK & Europe, but also globally…
A serviced accommodation unit is a fully furnished apartment (or house) available for a short-term or long-term stay, providing hotel-like amenities such as: house-keeping, laundry and sometimes a gym & pool. Most units are equipped with fully stocked kitchens, amongst other facilities.
As an investment, a Serviced Accommodation unit has several advantages over a standard Buy-To-Let property. One huge advantage is the cashflow being as much as 3x HIGHER.
With a growing population, supply is always constrained while demand keeps growing, this is why rent prices are increasing so rapidly. Many hotels are being squeezed by the overwhelming demand for short stays. This is where Serviced Accommodation picks up the overspill.
One thing to understand is that: If properly maintained and taken care of, a Serviced Accommodation unit will raise its value just by existing.
Making improvements to a Serviced Accommodation property can increase your rental asking price substantially.
The growth of business travel makes a Serviced Accommodation unit thrive amongst other property investment models. As long as you get good reviews and keep the guests coming, a serviced accommodation will always provide a steady income stream without the risk of having tenants.
A Serviced Accommodation unit doesn’t have tenants, it has ‘GUESTS’ – which do not have the same rights as tenants and have no right to stay or even squat in your property.
The Police can remove them instantly if you want them out!
UK companies have reported an 86% increase in the use of Serviced Apartments these past 5 years alone.
Another great advantage about Serviced Accommodation as a property investment model is that you can do it in houses, cottages and apartments, as well as tree houses, on boats, etc!
Whether you’ve got a two-bedroom or a five-bedroom house, a bit of research on authority websites like trip advisor will give you an idea of pricing for your property area. Compare a similar accommodation in the area to your potential unit and assess if it meets similar standards or even better. Such an assessment then allows you to weigh whether the model could work in that particular area.
Lastly, if you don’t have the funds to actually buy your own Serviced Accommodation unit. Why not rent one from a local landlord for the standard rental price they would rent this to the market for (e.g. £800), and then turn it into a Serviced Accommodation with the landlords consent!
You could potentially earn £100 per night x30 nights = £3,000 per month!
This is exactly what Cashflow investing is all about, working with local landlords and companies to provide a great service and what we are the leadings experts in at the Property Cashflow Academy.
Why not take a free course with us or watch a webinar at the Property Cashflow Academy
We’d love to see you in our friendly and thriving community of people who make a full time income from property starting with less than £5,000 and often all within the first 6 months!