One of the most lucrative strategies in the industry at the moment is called rent to serviced accommodation… but what is it?
Rent to serviced accommodation, otherwise known as Rent to SA falls under the wider market of rent to rent. It involves taking control of a property by paying rent to a landlord and then renting that property out again for a profit.
For example:
A landlord is advertising a 2-bedroom apartment in Leeds city centre for rent at £900 per month. You could approach the landlord and agree to give him the guaranteed rent every month of £900. If the landlord agrees to this you can then potentially rent the property out on a short-term basis to corporate clients, holiday makers or building companies amongst many others for let’s say £100 a night. This means that if you can rent the property out for let’s say 20 nights of the month you can earn £2,000. From the £2,000 you will have to pay the landlord 900 and cover the bills of let’s say £300. You may have management costs and other online booking fees to take into account but in principle you can potentially earn £800 a month from a property you don’t own.
Ask yourself this…
How many of these types of deals do I need to replace my income?
You could potentially replace your income with maybe just 1 or 2 properties.
Obviously, there is some risk involved with the main one being the property not renting out on a night by night basis due to a lack of demand.
This is where it’s so important to have the KNOWLEDGE and EXPERIENCE so you know where serviced accommodation will work and where it won’t. Location is everything with this strategy and this does not necessarily mean just city centres, although this is a common presumption.
Locations that attract a high turnover of guests such as business area’s, theme parks, football stadiums, monuments etc. all can be good markets for serviced accommodation.
As the market grows I think it's crucial that if you are looking to act, to act now in order to time the market right.
If anyone is interested or would like further questions about this strategy then let me know. Send us an email through info@ppsltd.net We source serviced accommodation every day and we live and breathe knowledge and experience!
Have a great day!
