Coping with property loan repayments can be tough. It’s important not to forget this. Especially once you feel you are ready to put some money into your first investment property. It would seem that many Malaysians are indeed ready to jump into the property market.
Despite the market being considerably ‘soft’, new developments continue to pop up on every side of every street corner. This implies that many people just like yourself (and just like me), are buying these properties and taking up loans to do so. These loans however, slowly emerge as termites in our bank accounts, eating away at our precious hard earned salaries.
Isn’t the idea of buying an investment property to make money though? The very word ‘investment’ means that we’re supposed to make money from these things, yet the harsh reality that the loans we’ve taken for our investment look more and more like a long-term liability.
With the current market ‘softness’, rental rates are down and it’s almost impossible to find a tenant at any rate that’s even close to covering your property loan repayments. How can we cope with the burden of property loan repayments?
Short-term rental platforms are beginning to look like the property investors saving grace. These various platforms are allowing investors like us to have a chance at covering our monthly repayments. These services offer holiday goers the option to rent out vacant condo units and pay a premium rate for their night’s stay, that far exceeds what a long-term tenant would pay on a day to day basis.
The idea is that the short-term tenant or ‘guest’, gets to stay in your investment property as if he were staying at a hotel, yet at a slightly cheaper rate for a larger space. Instead of groups of friends having to book large hotel suites or multiple hotel rooms, they can now book a larger unit that can accommodate everyone for a fraction of the price.
The most popular of these is Airbnb and the way in which they and other platforms have taken over the market is absolutely unbelievable. Airbnb, on their own, was revealed to be worth US$30 billion during its last valuation, putting it at just about US$4 billion less than the world’s largest hotel chain; Mariott.
The company has also achieved this in record time, considering it was only founded in 2008 and then rebranded in 2014, which is when it really took off. In just a few years it has managed to catch up to the hotelier giant which opened its first hotel way back in 1957. By the end of 2015 it was already reported that Airbnb had hosted more than 8 million guests and was used by more than 50,000 homeowners per night.
The widespread success of short-term rental platforms is not only due to the benefits the of guests but also because of its tremendous benefit to property investors like yourself. Through the platform, you can cope with your property loan repayments and in many instances, command a decent profit on top of it.
Have a look at this Beginner’s Guide to Airbnb, or get in touch with us for a free consultation on your property to see how listing your property on a short-term rental platform can help you cope with your property loan repayments today.