If you're hoping to buy a property that you'll be able to rent out as a landlord, you have plenty of options. You need to choose which one will be the best fit for your finances and future. Some landlords like to rent out small single-family homes. Others like to rent small, inexpensive apartments that appeal to a wide rental market.
However, luxury apartments, though more costly, can also be a great investment. Here are some of the benefits of choosing a higher-end rental market.
1. Reduced tenant turnover.
People who rent higher-end properties usually have enough money where they could buy a home if they needed to, or they have a steady job that provides them with plenty of financial flexibility. Renting is a matter of practicality. Perhaps they want to save money for a downpayment, or perhaps renting is simpler depending on the market values of property in your city.
Whatever the case, you'll be less likely to deal with a revolving door of tenants who stay for only a year, causing your one or two months of lost income as you hunt for new tenants. You'll also be less likely to see damage to the home, tenant evictions due to unpaid rent, or trouble from other people who live and buy in the same apartment complex.
2. Increased HOA services
As a property owner, you're still on the hook for maintenance costs. However, luxury apartments usually come with well-funded HOA services that take care of a lot of maintenance problems for you, which makes your life simpler as a landlord. Some apartment HOAs even do minor repairs on properties and take care of things like painting and window replacement, because they want the whole building to have a streamlined look as it gets older.
3. Increased property values.
Luxury apartments in a desirable neighborhood will go up in value. If you need to sell the apartment down the line, all the nice features will be a selling point that attracts buyers, and you won't have to do major upgrades to the apartment to make it liveable or sellable. In cheaper neighborhoods, crime or run-down buildings next door can scare buyers away and affect your overall sale price.
4. High marketability.
Finally, the amenities from a luxury community make your investment marketable to tenants. Tenants like to hear that the apartment has a large kitchen with quartz countertops, access to a spa and swimming pool, and increased security from a doorman or check-in desk.