Have you considered investing in a property that allows you to offer serviced accommodations to customers this year? York is one of the oldest cities in the UK and one of the best places to invest in rent to serviced accommodation-York.
As well as contemporary properties, York City offers a wide range of historic properties as well. Due to its rich history, owning York serviced apartments is a worthwhile investment that will pay dividends in the future, with the population growing from 200,000 to 232,000 by 2032.
Investing in real estate is always a wise decision, although there’s always a risk of not finding tenants for your property for a short period. To mitigate this risk, the best option may be to invest in accommodation services in York.
Keep reading the article to explore the benefits of renting to serviced accommodation to investors.
Key Takeaways
- When investing in York serviced apartments, location is still one of the most critical factors.
- A property valuation is also a significant factor to consider when securing financing for the purchase.
- Considering the expected cash flow and profit opportunities when purchasing property in York is essential.
What Goes into Serviced Apartments?
Serviced apartments are equivalent to hotels, as they are also a form of accommodation for long-term and short-term tenants. In contrast, traditional apartments only work as a home for their owners or as an investment for investors. As part of its role, a management company helps take bookings from travellers and cleans and maintains the apartment between bookings.
Benefits of Investing in Serviced Apartments
There is a potential for an R2SA in York to provide a more stable rental income for any investor than a traditional apartment investment. Unlike other apartments, serviced apartments are leased by their operators, so even though they may not be occupied, the rent is still paid to the operator. There is also the possibility that operators will pay higher rents than the average tenant.
There are also several other benefits to investing in a serviced apartment. You won’t need to worry about maintaining the property like you would with another investment property. It is often the case that the operator, who manages the building, also manages the maintenance and repairs for its occupants, thus saving the owner both time and money since they take care of repairs and maintenance themselves.
Additionally, r2sa properties are often part of large apartment complexes that provide a healthy supply, which makes them less expensive to purchase than some traditional apartments.
Investment Risks Associated with Serviced Apartments
Investors are typically the only ones who purchase rent to serviced accommodation in the UK. Considering this, if you decide to sell your investment in the future, you might miss out on potential buyers who own and occupy the property. As a result of this lower demand, capital growth could become more challenging to achieve.
Serviced apartment operators can be flawed. Some chains are well-known and have a long history, but others are smaller and less established. In some cases, these smaller companies could fold up and leave you without an income, while in other cases, larger companies could decide to pull out of a building that does not work out for them and leave you without an income.
In some cases, it is more difficult to successfully obtain a mortgage loan for a serviced apartment when compared to a traditional property, as banks and mortgage lenders may consider this a risky investment compared to a more traditional property.
It may have to do with the lower demand from potential buyers mentioned above, as well as the majority of serviced apartments being situated in tourist areas, in addition to the previously mentioned factors.
In these areas, there are fewer permanent residents, so government and businesses tend to fear that they will not be able to invest in the infrastructure that can contribute to the appreciation of property values in these areas.
Ways to Buy a Serviced Apartment
When viewing new serviced apartments developed by their developer for sale, this is particularly useful for you when renting serviced apartments for rent. As a result, if they are not sold before their expiration date, they could be added to the market.
It has been found that not all mortgage lenders will be willing to offer a loan for the purchase of a serviced apartment, so it may be worthwhile to compare mortgage deals and contact lenders before applying for a loan so that you can make sure their product can be used for this purpose. Getting a loan for a serviced apartment may require a much higher upfront deposit to offset the lender’s risk.
In addition, check out the deals we currently have available here, or contact an estate agent who is knowledgeable about the serviced apartment market and can assist you with your application for a mortgage.
Conclusion
Property in York is a great investment. With an average property price of £323,477, you can find some good deals with a property sourcing company.
At Pluxa Property, we are skilled in finding the right investment solution for your needs. It would be our pleasure to assist you.
The need for an investment company with years of experience, such as ours, that specializes in property investment feels the need to put in the effort and be dedicated to meeting the client’s needs.
A property that meets your needs is our top priority, and we strive to guarantee that you receive the best possible deal possible at all times.
FAQs
Which is better to visit, York or Durham?
There is a longing envy when one stares at the gravestones of the dead in York and eats stale bread. It is worth considering Durham, Manchester, or Liverpool and staying away from York, which is like a purgatory for tourists trying to get into Edinburgh.
What is it like to live in York?
The city not only boasts some of the most stunning historic buildings in the UK, but York also features several cool cafes, restaurants, innovative businesses, and arguably the best internet in the world.
Peter Juhasz is the founder of Pluxa Property, the biggest property investment company in UK and Group CEO of AIP Capital Group and a property investment expert with over a decade of experience in the UK market.
He built a successful property company using innovative cashflow strategies like Serviced Accommodation and HMOs, scaling to 200 units in four years.
Peter leads a team specializing in property and business acquisitions across various sectors. A former co-host of “Cashflow With Property,” he shares his expertise in real estate investing and business scaling.
He is committed to continuous learning and helping SME owners and investors maximize their returns, driven by his passion for empowering others to achieve their financial goals.
To learn how Pluxa Property can help you in UK property investment, contact our experts.
