The short let market is still an untapped segment of the real estate market, Do you know what the business of shortletting entails?
Simply said, it’s the process of renting or buying a property with the intention of using it for short-term rentals. You furnish it and then list it on well-known websites like Booking.com, AirBnB, etc. It appeals to visitors to the country, newlyweds seeking a romantic getaway, friends hosting house parties, and pretty much anyone seeking a home away from home experience.
LET’S DO SOME MATHS
Rental value for one night (2 bedroom) – N100,000
Average expected revenue at 60% occupancy rate (219 nights) – N9,855,000
Average returns annually – N9,155,000
The remainder is pure profit in addition to the ongoing increase in the value of your property, asides from other minor repairs and replacements.
WHY YOU SHOULD INVEST IN SHORT LETS
- HIGH RETURNS ON INVESTMENTS
The average returns on investment for a 2 bedroom on shortlets with a 60% occupancy rate is around 9,000,000 to 9,855,000 annually
- MORE IN DEMAND
For 100-120K, you can rent a three-bedroom shortlet that can accommodate 5 to 10 people, while hotels typically have occupancy limits of two or fewer for each room. Shortlets typically have access to services like Netflix, a kitchen, and a spa at no additional charge, which is uncommon for hotels.
Therefore, short-term lodging is more popular than hotels. The occupancy rate of the majority of shortlets is up to 90% in the busiest areas like VI and Lekki.
HOW TO GET STARTED
- Find an apartment to buy. Amazing deals are currently available from respectable real estate businesses, like the Ruby III apartment by Novarick Homes and properties located in Ologolo Lekki with a flexible payment plan for up to 9 months
- Invest collectively: A group of investors can pool their resources and purchase a property with the goal of using it as a shortlet. Each person receives a quarterly return on investment of up to 30% for the rest of their lives. Shares may be transferred from one investor to another, and the property will be held in trust for the investors.
In summary, the shortlet market is getting renowned and is slowly overtaking the hotel business, due to its flexibility and accessibility.
