If you are looking for a way to get into the property business and have no property of your own, the best way to start making money quickly is by getting into the Rent to Rent business model.
What is a Rent to Rent property?
Rent to Rent (R2R) is when you rent a property from the landlord and rent it out to long-term tenants (HMOs) or short-term guests (Service accommodations).
Initially, you will have to invest your own money to kick start the business, but as you get more occupants, you will have a regular cash flow with a portion going to the landlord as rent, a portion for the services you provide and, the rest would be your profits.
How can you get started with Rent to Rent Service Accommodation business ?
You can start by making a business model that focuses on the type of clientele you are targeting and suitable properties.
For example, if you are looking at cities that are popular holiday destinations, your target customer is a vacationer, who will be staying for 1-2 weeks or even longer.
If you are looking at cities that see a lot of corporate customers, your properties should be close to their work, have good transportation systems, restaurants, etc.
There are many factors that you should consider before looking for a property like:
Location: It is always advisable to find properties close to major hospitals, airports, universities, or city centers. These areas are property goldmines and tend to do really well all around the year.
Connectivity: Ideally, the area your property is located in, should be well connected to other parts of the city, through buses, trains, cabs, etc.
Miscellaneous: Depending on the type of clientele, you can also look for properties close to famous tourist spots, restaurants, pubs, parks, etc. Areas with low crime rates also do really well, so don’t forget to factor that in your search!
But how do you actually find the property for Rent to Service Accommodation?
Once you have a rough picture of the ideal property in your mind, you can start looking for properties. There are many ways you can do that.
One way is to find letting property sourcing agents who manage properties in the areas that you are interested in, and have meetings with them discussing your business idea about renting out the property.
Another way is to find landlords directly and have meetings with them, where you explain your business model and promise them steady guranteed monthly rent regardless of occupancy.
Alternatively, you can also look for properties online on websites like Open Rent or put out a word on Facebook groups.
Once you have negotiated with the landlord and/or letting agent and signed the contract, you can start your business right then.
However, to attract customers, you will have to invest some money into refurbishing the property to make it look enticing and fit to stay.
Hire some interior decorators to redo the property according to your target. You also need to outsource services for cleaning, concierge, repair work, electrician, etc.
Once you have a system in place, you can start advertising your services on websites like Airbnb, Booking.com, or Facebook Marketplace to get tenants/guests. You can also enroll in a free property marketing course to learn marketing.
There is a lot of easy money in the rent to rent service accommodation business if things work out perfectly, but it is not for everyone.
If you play your cards right, you will be able to make a lot of money really fast!