Hey there, landlords! Are you looking to maximize the return on your investment property? Well, you're in the right place because today we're going to talk about the serviced accommodation (SA) strategy.
Now, before we get into the nitty-gritty, let me just explain what the SA strategy is. Essentially, it's renting out your property on a short-term basis, usually to business travellers or tourists. Now, you might be thinking, "But I already rent out my property, what's so different about this?" Well, let me tell you, there are a ton of benefits to using the SA strategy that you might not have considered.
First off, let's talk about occupancy rates. SA properties tend to have lower occupancy rates compared to long-term rentals, which means there will be less wear and tear on your property. That's because there's always a constant demand for short-term accommodation from business travellers and tourists, who don't spend as much time in the property as tenants, and there will often be occupancy gaps between guests. Do you know what that means? More dough in your pocket!
And speaking of dough, let's talk about rental yields. SA properties can command higher rental yields compared to traditional long-term rentals. Guests are willing to pay a premium for the convenience and amenities offered by serviced accommodation. And who doesn't love a little extra cash flow?
But it's not all about the money, folks. The SA strategy also provides landlords with the flexibility to rent out their properties for short periods of time. This can be especially useful for landlords who only want to rent out their properties seasonally or for a specific event. I mean, who wants to be tied down to a long-term rental contract when you can have the freedom to choose when and for how long you want to rent out your property?
And last but not least, there are tax benefits to using the SA strategy. In some cases, landlords may be able to take advantage of tax benefits by using their properties for serviced accommodation. It's always a good idea to consult with a financial professional or tax advisor to determine the specific tax implications of this strategy.
Now, I know I've thrown a lot of information at you, but before you jump in headfirst, there is something important to consider. Using the SA strategy carries more monthly volatility of income, and if landlords would prefer less risk and more consistency with the income from their property, they should consider renting their property for long-term Guaranteed Rent to a serviced accommodation company.
And if you're still feeling hesitant about taking on the SA strategy, don't worry! Landlords can take advantage of the SA strategy completely hands-free using an SA Management provider. They'll handle everything from guest communication and cleaning, to financial and property management, so you can sit back, relax, and watch your investment grow. And if you're a busy landlord, I don't have to tell you how valuable that is.
Overall, the serviced accommodation strategy can be a good option for landlords looking to maximize the return on their investment. But, as with any big decision, it's important to carefully consider the pros and cons before deciding if this strategy is right for you. I hope this information was helpful, and as always, happy landlord-ing!