Finding the right investment domain in the real estate landscape can be akin to discovering a hidden treasure. If you understand the ups and downs of a domain, then you can generate long-term returns and steady cash flows. Not just that, we know real estate is more resistant to inflation, so you have that security in hand too.
One real estate niche that has been steadily gaining popularity in recent years is serviced accommodation (SA). For those uninitiated, serviced accommodation refers to fully furnished properties available for short-term rental, providing all the comforts of home and the convenience of a hotel. The popular word is that SA is one of the best investment options in the UK right now.
So, let's delve into why serviced accommodation is gaining popularity, drawing insights from the experience of Trevor Henry and Greg Coles, CEO and COO of Reloc8 Em, a prominent London-based rent-to-rent SA firm.
What is Serviced Accommodation?
Before we jump into the intricacies of why serviced accommodation is a stellar investment, let's understand what it actually is.
Serviced accommodation encompasses various properties, including apartments, houses, and even boutique hotels, all furnished and equipped to cater to guests' needs. These spaces are typically booked for short stays, often by business travelers, tourists, or individuals seeking a home away from home.
The Rise of Serviced Accommodation
Now, let's get into the nitty-gritty of why serviced accommodation is becoming a sought-after investment option, as seen through the eyes of industry veterans Trevor Henry and Greg Coles.
Trevor Henry, CEO of Reloc8 Em, on Market Demand
According to Trevor, the growing demand for serviced accommodation is undeniable. "Business travelers today are seeking more than just a bed to sleep in; they want the comfort and convenience of a home while on the road," he states. The rise of remote work has also contributed to the surge in demand for serviced accommodation as individuals seek flexible, comfortable workspaces within their temporary abodes. As a result, the occupancy rates for well-managed serviced accommodation units have been consistently impressive.
Greg Coles, COO of Reloc8 Em, on High Yields
Greg highlights another compelling reason to invest in serviced accommodation: the potential for high yields. "When managed effectively, serviced accommodation units can generate significantly higher returns than traditional buy-to-let properties," he explains. Short-term rentals often command premium rates, especially in prime locations, leading to a robust income stream for investors. This dynamic pricing allows for adapting to market trends, ensuring a steady flow of revenue.
The Flexibility Factor
Serviced accommodation offers investors a unique degree of flexibility. Trevor emphasizes that "you can pivot easily to accommodate changing market conditions." Whether you target tourists, business travelers, or even individuals relocating for work, the adaptable nature of serviced accommodation means you can cater to various client profiles, minimizing the risk associated with market fluctuations.
Minimal Hassle, Maximum Returns
Investing in serviced accommodation does not necessarily mean becoming a full-time property manager. "You can opt for a hands-off approach by partnering with professional management companies like Reloc8 Em," Greg notes. These experts handle everything from guest check-ins and maintenance to cleaning and marketing, leaving you to enjoy the returns without the associated stress.
In Conclusion
The allure of investing in serviced accommodation lies in its ability to offer substantial returns, adaptability, and a hands-off approach to property management. As Trevor and Greg assert, this investment niche is well-positioned to cater to the demands of modern travelers and remote workers.
However, like any investment, success in serviced accommodation requires careful planning and execution. It's crucial to research locations, understand the target market, and partner with experienced management teams like Reloc8 Em to ensure your investment reaches its full potential.
Serviced accommodation stands as a beacon of opportunity. So, if you're considering diversifying your investment portfolio or entering the property market for the first time, take a page from Trevor Henry and Greg Coles' playbook and explore the promising world of serviced accommodation. It might just be the investment journey you've been waiting for.
