Investor Hamish Comben explains his strategy.
Many people who invest in property use funds generated from a business or job that is their main focus and priority.
The former owner had lived in the property, a two-bedroomed terraced house, for over 60 years and it was in a very poor state when he bought it. He added an extension at the rear to create a large contemporary kitchen/diner, upgraded the electrics and plumbing and landscaped the garden.
His initial intention was to either sell the house or rent it out on an assured shorthold tenancy. However, given the location and proximity to the Cheltenham race course, he finally opted to rent the property through Airbnb as serviced accommodation (SA). By adopting this strategy, not only did he achieve an income equivalent to a healthy pension (circa £40,000 gross per annum) with a 10% yield, but it also started him on the way to establishing a very profitable business as a Pass The Keys (PTK) franchisee.
PTK is an established PropTech company and accredited professional Airbnb co-host within the SA sector. Hamish openly talks about his decision to join the franchise when he recognised that his lack of experience and credibility in the early days was holding him back in growing his serviced accommodation business. As franchisees take on properties on a management basis and the responsibility for furnishings, bills, etc, remains with the owner, Hamish has been able to scale much faster than he could through continuing to buy and refurbish.
The article outlines the challenges in being a middleman in the SA sector, dealing with the emotions of both owners and guests in a review-based business environment. Hamish also provides lots of advice and guidance from his experience of building a profitable SA business that now has 20+ properties under management. This is an essential read NOT to be missed, providing lots of valuable guidance if you are interested in SA.
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YPN writer and property investor