Real estate short-term rentals – Airbnb rentals – have become a popular new source of rental income for Kenyan homeowners and landlords. They are also beneficial for travellers as they provide an affordable and comfortable alternative to hotels.
This is a current investment option with the increase of tourists who want to live in the country for a short period of time. Thinking about making money from real estate by renting out your property or an extra room on a short-term basis?
What to consider:
As the short-term rental industry grows, demand continues to increase. This is now making an investment in short term rental property a more attractive prospect.
It might be part of a retirement plan; an opportunity to pursue a digital, location independent life, or to achieve a family goal to own a second home.
Buying a vacation property has the potential to deliver significant income to offset mortgage and other costs. Moreover, this is shaking the very foundations of the tourism sector, pushing up property market prices as its key model of self-catering takes enterprising Kenyans by storm.
As with any investment, due diligence is critical to a successful outcome. So it is necessary to do research that is wide-ranging.
Making an informed decision about where to buy and whether there is a potential for sufficient rental to make it worthwhile means doing research into many areas.
This might include regulations, zoning, and local infrastructure, inbound tourism statistics and taxation issues.
There is also a competitive analysis of the local vacation rental market to understand the traveller demographics and occupancy potential to consider.
This is a unique market and knowing a few things about how it works, who to approach in the research phase, and the obstacles that may be encountered along the way can be a huge factor in creating a successful business.
Not all Kenyan realtors know the short-term rental market
Only a small percentage of realtors understand the vacation rental business, and it’s important to work with an agent who does.
Ask questions about their experience of selling properties that have short-term rental potential, being careful to distinguish that from the residential rental market.
A good realtor will be able to discuss supply and demand, regulations, inbound tourism, seasonality and the importance of location for different traveller demographics.
Find the right one, and he or she will reduce the time you spend on research considerably
Buying can be the best investment
A property that has solid short-term rental history has a list of previous guests for remarking purposes, and may come with reservations already in place is a valuable asset.
These properties can start earning income from day one and there won’t be a need to set a lower rental rate in order to start attracting guests.
This type of property may be listed over the current market value but the benefits may well outweigh the premium cost.
To cover the bases, make sure the owner can provide at least three years of rental and income records.
Moreover, this concept is brought in millions of revenue to Kenya and is an amazing idea for investment.
