One thing that can
be said about real estate; there will always be a demand for accommodation,
even more so in specific locations such as cities and their suburbs, and if you
are thinking about getting into the rental sector, there is much to consider.
Crunching the Numbers
This is the first
step that will help you make an informed decision, and whether you are looking
to acquire a condo, apartment or house, calculate the cost of buying and
renovating to make it acceptable for rental. This would include:
- The
price of the real estate - Legal
fees and stamp duty - Cost
of property renovation - Cost
of furnishing
When you have done
that, then you can look at projected rental for certain locations, with a
realistic estimate of the rental you can charge, then you have a clearer
picture of the project. If you would like some idea of the rental for a
serviced apartment in Melbourne, for example, check out what’s available at https://platinum-apartments.com.au, a leading property management and
apartment rental specialist.
Location is
Everything
While you might be
able to buy an old property in a rural area for a very cheap price, this is not
prime rental territory, rather you want a location that is close to the city
and has all the amenities in the local vicinity. Buying an apartment in
Melbourne would likely give you a good return and if you joined forces with an
online company that connects landlords and tenants, you can expect to enjoy
many bookings, plus rentals in Melbourne are at the upper end of the price
scale.
Long or Short
Term?
You need to decide
whether you are targeting short term holiday tenants or professional people who
are looking for a 6-12 month lease, and both have their pluses and minuses.
Airbnb offers a platform, or you could connect with a local property management
company who would source tenants on your behalf. There are companies that
handle serviced apartments and they would manage your unit and rent it out to
suitable tourists, which should give you a steady income.
Research Land
Prices
Prior to deciding
where to purchase real estate for property rental, you should carry out some
research, looking for a popular area where land prices are at the upper end of
the scale and a desirable area that is in demand. If you can find a suburb that
has yet to be fully developed, this might be the best time make a purchase and
if the future development works out, you could be looking at a very good
return.
If you do your
research, buy wisely and join forces with a reliable property management
company, there’s no reason why you can’t make money out a rental property.
Without a management company, you would spend most of your time overseeing the
management of the property, much better to make use of the wide range of
services they offer for landlords, leaving you free to enjoy life.