What to look for when buying a holiday apartment investment
March 27, 2010 | admin | Comments 0
Investors will often buy a holiday apartment so that they can have their holidays in it, but also let it out for the rest of the year either themself, through an agency or through the onsite management.
There are several aspects to keep in mind when buying a holiday apartment and these are:
- find out how much money is in the Slush Fund – this is a fund from which the Body Corporate can spend funds to take care of the property
- how much is the Body Corporate fee and the Slush Fund Fee
- find out when the property was last repainted
- find out how old the property is
- have a good look at the furniture because in holiday accommodation it needs to be replaced approximately every 7 years (may be more in surf areas because of heightened deterioration) – when will it need replacing?
- how long as the onsite management been in management
- what sort of rental can be expected from the property
- check out the costs of letting out the property
- what marketing does the onsite management do to fill the accommodation
- what occupancy rate has it got and how will your staying there affect the income
- are other owners satisfied with the management and Body Corporate
These are some of the very important issues to look at before you even consider going to contract.
If as the apartment owner you intend to take your holidays during the peak Christmas/New Year period then obviously the income is going to be dramatically reduced as that is the top rental income period, however if you choose off-peak times then your stay may not affect the income at all.
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