6 Helpful Tips to Increase Your Rent Income by up to 80%

27/09/2018 | Property

Short-term leasing is a booming economy in Australia and savvy property investors are cashing in. It’s already disrupting the hotel industry because short-stay rentals tend to offer more value than hotel rooms at competitive rates.

In our previous blog post, we outlined the reasons why short-term leasing trumps traditional renting. Based on our projects, our clients have raised their rental income by 80% on average when switching to short-stay renting.

However, every investment comes with its own set of risks and this also applies to leasing to tourists and professionals. It’s crucial to plan your investment strategy carefully, seek the right advice and hire the right help. Never go in blind without knowing what you’re investing the money for, your return rate and associated risks.

Our extensive experience working with investors and AirBnb operators has given us great insights into this market. Here are six helpful tips for those seriously considering venturing into the short-stay rentals.

Helpful Tip 1: Location, location, location

It’s true that location matters and it’s not any different for short-term leasing. If you’re looking to buy a property, then consider the suburb, facilities, transport links and distance to all the must-see tourist attractions. If you already own a property, then start considering of how your property will appeal to tourists.

When you put yourselves in the traveller’s shoes, you would start to understand what they need and want. Generally, they are looking for:

Proximity to train stations, bus stops, cab ranks and major highways for those renting a car
Great dining options such as chic cafes and popular restaurants
Nearby convenience stores and supermarkets
Local attractions such as museums, iconic buildings, major shopping centres and theme parks
Working travellers love to stay near their workplace or convention centres for events

Furthermore, travellers generally don’t know much about the city they are visiting, aside from researching on Google. Some travel at the last minute so they won’t have much information. You can go the extra mile by providing a travel guide that shows why your property is the perfect place to stay.

Helpful Tip 2: Study your target market

Whether you realise it or not, you are running a business with a short-term rental. Businesses need to know their target audience inside out if they want to be profitable. Therefore, you must also study the market and determine your ideal guest.

Are you looking to rent to budget travellers, families or working professionals? Or do you want to appeal to a broad audience? Do you know what your guests need and want? Getting this right from the start will make your work easier, and make your money go further.

Helpful Tip 3: Furnish it fittingly

Once you know your target market, your interior and furnishings should attract to your target audience. Although it sounds trivial, the function, look and feel of your space can determine whether a person decides to stay at your place or not. There are many things that can make your place stand out from the rest, even when compared to other units in the same apartment block.

Firstly, your property must be fully furnished. Travellers, whether a single person, couple, family or business traveller will appreciate a complete temporary home while away from their abode.

Secondly, the interior must cater to their needs. Budget travellers will be happy with basic interior in good condition. Those with a bigger wallet will be looking for high quality furniture and appliances, which are worth the price they are paying.

Parents are always looking for a space that can cater to their children. Think of high chairs, sofa beds, baby cots, plastic plates and cutleries. And lastly, corporate travellers will appreciate a working desk with fast internet connection for work or keeping in touch with family and friends.

Helpful Tip 4: Jazz it up with accessories – Furniture Package Melbourne

Some of the items you provide will depend on your target market and the location of your property. However, the basic household items you should offer are roughly:

Bedroom: mattress, pillows, quilts, linen, iron and board
Bathroom: soap, shampoo, towels, hairdryer and toilet paper
Kitchen: cooking utensils, pots, pans, bowls, plates, cutleries, toaster, kettle, oil, sugar, salt and pepper
Appliances & electronics: TV, fridge, washing machine, dryer, microwave oven, Wi-Fi internet and universal adaptor plugs.

There’s a growing trend for hosts to charge extra for linen and towels because it is expensive to clean them thoroughly in between guests. Make sure you list this clearly in your description so guests are not left empty headed or shocked, especially for overseas travellers.

Helpful Tip 5: Point of difference

Think of what makes your property unique. If you’ve done your homework on the location and furnished your space appropriately, this is a simple question to answer. List down all the good points of your space and get creative.

You need a descriptive headline that sells the features of your property in as few words as possible. It could be the orthopaedic king-sized bed, the sweeping view of the city from your balcony or the award-winning coffee downstairs.

Here are a few samples to get your brain buzzing:

Convenient apartment in the heart of the city with a gym, pool and spa!
Catch the stunning sun rise from this apartment, central to all tourist attractions
Beautifully furnished one-bedroom apartment perfect for a romantic weekend

Helpful Tip 6: Hire the right help

Doing all the steps above will require hard work and time. If you are time poor or simply want to sit back and make passive income, then you can hire other people to help you.

At MORC, we don’t just research, plan and furnish your property. We also connect you to reputable short stay managers or companies which will put your mind at ease. They know the peak and off seasons, vacancy rates and overall viability of the market to help maximise your investment.

Check out our case study in early 2017 for a property in St Kilda. This client is already on track to double the annual rental income while annual profit is expected to increase by 58%. This was all done without lifting a finger because we do all the legwork for you.