With the opportunity of becoming a landlord just a click away, it seems that most home owners find a rather consistent revenue stream in the renting market. We already have successful business models such as AirBnB which work great with short-term rentals, and that’s not all. We all thought young families and couples, singles and millennials prefer to rent rather than to own a place. However, real estate trends in 2016 showed that rents were stagnating in less popular cities, while going up in startup-nest cities such as San Francisco, where a two-bedroom apartment would go up to $5000/month. This had a double impact: on one hand, it made buying houses more attractive to the young generation in the big cities; on the other hand, it really reminded millennials that they aren’t limited to a certain location and can very well move to places where payment is high and rent is low. This motivated the young landlords to rent their homes at an affordable price, enough to cover the mortgage costs. Below is a series of factors that motivated people to buy a house in 2016, top 3 being credit history improvement, promotion/raise and saving for a down payment.
Things to Keep in Mind When Buying a Property
13 steps into buying a new property:
- Offer and Acceptance;
- Deposits;
- Appointment to Act;
- Financial approval;
- Signing of Mortgage papers;
- Transfer of Land;
- Stamps (Stamp duty in some cases);
- Special Conditions (to be met);
- Insurance;
- Financial Inspection;
- Arranging Settlement;
- Effective of Settlement;
- Keys (access) to the new property.
Once all the steps are completed and the new landlord acquires ownership of the new home, they can proceed with the legal documentation to rent short-term or long-term.
Preparing Your House for Renting
Just like with every new acquisition, a house needs improvement and is considered a lifelong investment. Every new buyer wants to add a touch of their personality and preferences in terms of interior and exterior design. Home owners usually do not make improvements if the house is either a historical heritage property or the landlord never plans on living there, so renovation costs aren’t fully justified. The downside of not investing any money in your purchased property is you could never ask for a fair rent price. The more benefits and home improvements a house has, the better for nailing down a decent price on the renting market.
Adding a Pool to Your Yard
Everybody loves being near water. Even when it’s not possible to have a nearby lake or small spring, if you are lucky enough to get a house with a generous yard, the best immediate addition would be an outdoor pool. This can raise the rent prices by a few thousand USD per year with just a one-time investment. You can play with light effects for a quiet evening experience or for pool parties. Outdoor pools usually have water filtering systems that make it easy to clean the water or keep the pool covered during cold season.
Indoor Functionality: Elevators and Residential Lifts
People need to simplify their lives as much as possible, because the stress of everyday life will eventually weigh down on them. In this regard, architects have found the answer. Bringing technology into homes, will not only increase the value of the interior, but also bring more comfort. We know that it might sound a little outrageous, but in the next few years, cars will also become an essential part of home design. And not only cars: imagine keeping your lovely motorcycle in the living room – a prized possession that friends dropping by will constantly admire. And why not go further by clicking a button and in a couple of seconds, the lift brings your motorcycle from the living room to the front porch of your building? Take it for a ride, go to the office or just take it for a spin. With everything within reach, the modern man will no longer have to worry about house chores or exhausting earthly tasks.
Architects anticipate an alleviation of menial problems which will lead to a better concentration on career and a more relaxed lifestyle.
Luxury Sells… and Rents Easily
If your aim is not long-term, but rather short-term rentals, think big. We already see offers to rent homes for the holidays, so there is an active market. Nomads are looking to get a mix of comfort and unique in terms of rent experiences. The best way to justify higher prices is either to provide a genuine local experience or a deep-dive into luxury for the time being.
With these aspects in mind, what are your plans for financial prosperity in the housing market? Will you buy a house in 2017 and keep it or rent it?