Australia’s attractiveness to tourists stems from the perfect blend of astonishing factors. These include beautiful landscapes and outdoor paradise serving a laid-back lifestyle to everyone. And since short-term rental options are booming in the real estate market. The number of users in the Vacation Rentals market is anticipated to reach 6.84m users by 2028. However, owning a vacation rental property can be enticing and challenging at the same time.
Vacation rental property refers to a furnished apartment, house or accommodation rented out to tourists during their vacation time. Travellers seeking flexibility and a home-like feeling prefer to stay in these types of properties.
In this blog post, we’ll talk about some of the pros and cons of owning a rental vacation rental property:
Pros of Vacation Rentals
Rental Income
The main advantage of owning a vacation rental is the rental income you’ll be able to make. You can rent out the property when you’re not using it to generate a steady stream of income.
Since most of the travellers prefer convenience over everything, this might be the best option for them as well.
Property Appreciation
Vacation rental properties are usually located in desired locations that can offer valuable returns after a certain time. And when you do timely renovations and maintenance, you can sell the property at a profitable price.
Tax Benefits
When you own a vacation rental, it will be your business venture. Being the owner you can write off several rental expenses enjoying plenty of tax benefits. Depending upon the location and use you can qualify for certain deductions such as mortgage interest, maintenance costs & property taxes.
Cons of Vacation Rentals
High Initial Investment
Purchasing this kind of property usually requires a significant upfront investment. This includes closing costs, down payments and potential renovations to make the property appealing to attract the renters.
Seasonal Fluctuations
Earnings from vacation rentals can vary depending on the time of year. During busy periods, it’s possible to earn a substantial income, but on off-seasons, there is little to no income from the property. Thus, it becomes difficult to predict and manage the cashflows.
On-going maintenance and Repairs
To keep the property in good condition one has to focus on timely maintenance. The more attractive the property looks, the more renters are supposed to reach out. Managing the property, handling the guests, cleaning and solving the renters’ issues can be a lot. So, hiring a property manager comes on the list which adds up as an extra expense.
Unlocking success in Australia’s vacation rental industry can be challenging. However, selecting the right property at a desired location can bring substantial profit.
Let Sapphire Real Estate take care of that part and assist you in discovering the best properties in Queensland!
