Technology has changed the way property owners manage their properties. Short Term Rentals are always considered as the vulnerable business model as it would be difficult for the landlords to rent the property multiple times every year. But with the rise of companies like Airbnb, the world has realized that there is a huge gap in the Hospitality industry which can only be covered by Short Term Rentals (STRs). Let’s explore how the Short Term Rentals are revolutionizing the real estate market.
What are Short Term Rentals (STR)?
Short Term Property Rental is renting out the property for a short term like 4 days to a couple of months. Suppose you are planning a vacation with your family, you may go for Short Term Property Rental. If the length of the stay is more than six months it is typically considered as a Long Term Rental. For the last couple of years, technology platforms like Airbnb, FlipKey, HomeAway have completely revolutionized the way we look at the Short Term Rentals.
How are Short Term Rentals redefining Hospitality?
The leaner rental market has taken over the Hospitality industry in the last five years. Short Term Rentals have also turned out as a lucrative investment for the property owners. Both the landlord and tenant feel a sense of freedom as they are just signing a document for 30-days. They are not at all bound to lengthy contracts. Vacationers are preferring the Short Term Rentals to hotels. Short Term Rentals allow the tourists to feel like a local in the new area. For the budget of a mid-range hotel, Airbnb apartments can be part of an authentic neighborhood.
How is STR redefining Real Estate?
STR is transforming the Real Estate industry. Investors are now interested in buying even the smaller properties as they see the exponential rise of Short Term Rentals on a global scale. By 2021, the Short Term Rentals market is expected to touch $200 Billion dollars. Short Term Rentals reshaped the real estate market in many cities around the world. Many buildings which were once the apartments are now flipped into short-term rental zones. Thanks to technology, today people are landing their favorite vacation homes after knowing every bit of information about the property without any hassles. The penetration of Airbnb to almost 200 countries shows the impact of STRs on real estate industry today.
How is STR redefining investments?
Short Term Rental market is expected to touch $38 billion by the end of this year. The prolific investors around the globe are considering this market as a great opportunity for the investment. The goal of any investment is to see it growing. As a landlord who is offering the property for Short Term Rental, the goal is closer than ever. Traditional hospitality investments are good too but they take years for the returns. The investors are buying out the properties in many cities just to rent them out for short terms. The trends are now moving towards STRs from the traditional long-term rentals.
This is why real estate investment giants likeSmartOwner, Asia’s leading property marketplace, are now introducing investment opportunities in short term rental portfolios. By offering a globally diversified exclusive portfolio of luxury properties, offerings like the SmartOwner STR Series are changing the landscape of real estate investments by allowing individual investors a once in a lifetime opportunity to own a stake in a portfolio of properties in the hottest destinations and fastest growing regions of the world.
Gone are the days of investing in real estate the traditional way. Investors get quarterly returns that substantially beat the market, from the income generated by these short term rental properties. These generate much higher rents than the traditional rental model, and the profitability is further enhanced when portfolios like this are managed professionally and optimized with algorithmic pricing and superior services. Savvy investors who are informed of the transformational change in the real estate industry will be able to recognize the value of capturing the tremendous opportunity in this trend before it becomes less exclusive.