There is a lot of money to be made from investing in real estate. In particular, when investing in an Airbnb property. Doing short-term rentals when you buy Texas real estate depending on the area can be much better than finding long-term tenants. It all depends on a number of factors.
For instance, some people prefer to buy distressed property to fix up and flip at a profit when the market is this hot. Others prefer to have long-term tenants in a few different units to make money. If you are more interested in short-term lets for tourists and business people and are confident you can keep your property at full capacity then you will love doing Airbnb. In this article, we will go over what to look for in a property.
1 – Research the location
In some areas, you are better off going for long-term rentals with year-long leases. Others are better for Airbnb-type situations. This is because the market is decidedly different based on what the needs of the people in that area are. For instance, if you have a property by a financial center then long-term leases are the way to go since it is full of young professionals.
This isn’t going to be an area where an Airbnb is likely to work. If the area is also full of tourists then it actually is exactly the right area. For this to work you have to make sure that there are tourists that visit for the majority of the year. The rest of the time when there are fewer tourists there will need to be demand from other types of people.
If there is a convention center or someplace where there are a lot of business travelers then you should look into when those people are mostly there. This can give you the potential to have your unit full almost all the time.
2 – Think about the property type
The type of property is also going to play a major part in how often it is rented out. Different types of renters will be looking for different types of property. If the area has a lot of tourist attractions that attract families then you will want to have the type of property that can accommodate them. Look for houses or large condos in that area.
If you are dealing with mostly business travelers then a one bedroom with a little extra room for a desk to work will be what you need.
3 – Know the price points
The key to any kind of business is to keep your expenses low while getting the most revenue for it. The same is true of Airbnb. If you buy a very expensive property then you will need to make sure that you can charge enough to turn a profit.
Do some research into what types of property are doing well and in what areas. Then try to get an idea of what the average nightly cost is that you can charge. Do some napkin math to figure out if the numbers work and then you’ll know if you should buy the property or not.