Short-term rentals: how to make it work
LOCAL and state governments acknowledge the value of Queensland’s short-term accommodation sector as a source of additional income and a growing part of the state’s tourism industry.
But they also understand the challenges body corporates and some communities face when investment properties are turned into short-term stays with increased noise and security concerns among common complaints.
If you have an investment property you’d like to include in this in this growth sector, here’s what you need to know.
Industry research shows the sector, which includes operators such as Airbnb, Stayz.com and Booking.com represents 16 per cent of Australian holiday night bookings annually with host earnings in Australia increasing by 60 per cent to $978 million between 2016 to 2017.
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The Brisbane City Council city plan fact sheet recognises the short-term rental of a family home, unit or investment property as a valuable source of additional income and has a hotline (133 263) for anyone seeking further information on the regulations and licences needed for a proposed business.
The Queensland Government is working on a code of conduct to govern the behaviour of hosts and guests and also to introduce a system of data sharing to understand who is renting out their own home, and who is running a short-term accommodation business.
Queensland Tourism Industry Development Minister Kate Jones said huge growth in the short-term accommodation presented great opportunities in the tourism industry.
“But it’s also important to preserve our standard of living here in Queensland,” she said
Short-term rental property management specialists, MadeComfy, said Queensland was perfectly positioned to take advantage of the sector.
Investment properties in the Brisbane suburbs of the CBD, South Brisbane, Fortitude Valley, Milton, and New Farm can achieve a 70 per cent occupancy rate.
On the Gold Coast, properties in Surfers Paradise and Broadbeach are the highest performing suburbs, also with a 70 per cent occupancy rate.
“Despite the high competition, property owners in these areas have a great opportunity to maximise rental income if the property stands out from the crowd and uses the best pricing strategy to attract guests,” pricing manager for MadeComfy, Gina Zhang, said.
She has three top tips on how to maximise returns on a short-stay property:
Raise nightly rates and wait for last minute bookings. Set your prices higher than the average in the suburb. The goal is to catch last minute bookings in the week before check-in from guests who have few other options.
Raise prices for special calendar events. Set a higher price and a five-night minimum stay over public holiday weekends to make sure the property is booked over the entire period.
Acquire the right ratio between price and occupancy rate. A property with a $60 nightly rate and 100 per cent occupancy over 30 days will have a monthly return of $1800. However a property with a $100 nightly rate at 70 per cent occupancy will have a return of $2100.
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