If you’re an active investor, you’ve likely heard of a strategy that’s all the rage these days, which is co-living apartments. Even if you’re not an experienced investor, this strategy could be interesting for anyone looking to invest in real estate. Co-livings are becoming a popular technique in modern real estate for their dynamism, flexibility, and significant payoffs. In this article, we’ll dive into co-livings and tell you everything you want to know about them.
What is a co-living?
A co-living requires either renting or purchasing an apartment with several rooms in order to rent each one of the rooms to a different tenant. Therefore, you have multiple tenants living in the same house, hence the name co-living. Ideally, the apartment should be nicely decorated, modern, or at least have a fun design that helps attract young people like students or young professionals. Think of a vacation rental but that you rent to live in for a couple of months.
Benefits of Co-living Properties
For Investors
The investment amount needed is relatively small. If you choose not to buy the property and just rent it, you can start with less than $10,000.
Your investment will cover any necessary costs to set the co-living up, including furniture and design services. The property needs to have all the amenities, for example, dishes, an ironing board, etc. It should feel like a long-stay hotel for the tenants.
High return on investment. After investors pay the landlord or the mortgage and deduct all expenses, the amount they’re left with is usually higher than if they rented the entire property to one single tenant.
For Tenants
Allows them to save money, as renting a room means they pay a lower monthly fee. Also, in many co-livings, tenants can share the utility costs with the other tenants and pay less than they would otherwise.
Most co-livings have professional cleaning services, so tenants don’t have to worry if others aren’t as tidy as they are.
There’s usually professional property management by the agency handling the co-living. That means any issues that arise will be dealt with quickly and effectively.
In most cases, tenants can enter into short-term contracts. This aspect is particularly useful for students who may be living in a city for less than a year.
How to Create a Co-living
If it’s your first co-living, all of the moving parts may feel a little overwhelming. However, once you’ve put together a system and a team, it’s quite simple. First, you’ll need to find a property or hire a realtor to provide you with suitable properties. Bear in mind that the property’s location is crucial. Ideally, a co-living should be located near the city center and all places of interest.
Furthermore, when it’s a rental property, the landlord should be on board with sub-letting the property before you begin. Once you have the property sorted out, you’ll want to find a designer who can help choose a fun and attractive interior design, as well as help you furnish the property. Last but not least, you’ll want to go back to that same realtor to have them list the property for rent or list it yourself on a local real estate portal.
Over To You
Ready to open your co-living property? Luckily for you, at Wanderlust Realty, one of our specialties is finding this type of investment opportunity and handling the management. If you’re feeling brave and would like to give it a try, but would like the help of an expert, don’t hesitate to contact us. We can help you create a co-living that will grow your hard-earned dollars.
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