With short-term accommodation growing in popularity over the past few years, a large number of property owners have been left questioning how they should be managing their property. While there are some benefits offered by shorter, more flexible arrangements, this doesn’t discount the large number of advantages that are exclusive to longer-term leases.
At My Rental, we are dedicated to providing Australian property owners with affordable, innovative property management services. So, to help you decide what is right for your property, let’s take a look at the advantages offered by long-term rental agreements.
A Sense of Stability
Although the flexibility of short-term leases is of interest to many property owners, it comes at the cost of stable income. Long-term rental agreements, on the other hand, ensure ongoing tenancy, and therefore, a guarantee that money will continue to come in across a long timeframe. This allows property owners to effectively calculate and rely on their expected ROI across an extended period and with a higher level of certainty than can be provided by short-term options.
For those that own property in areas where supply is higher than demand, with more properties on the rental market than there are tenants to occupy them, the threat of extended vacancies is a concerning one. With long-term rental agreements, however, you can ensure that your property will remain occupied for long periods. Remember that a vacant home is not providing any source of income, so being able to depend on the regular income provided by a tenant is invaluable.
Ease of Management
The process of finding, vetting and approving new tenants can be a complicated one. From advertising the property to handling turnover to performing pre-tenant checks, short-term rental agreements require a sizeable amount of work on the side of both property owner and management. Long-term rental agreements, on the other hand, guarantee significantly less paperwork and advertising, as you won’t have to find a new tenant every few months.
Long-term tenants are also more likely to address maintenance concerns, as they will be staying in the home for a longer time and will, therefore, be more affected by less-than-ideal conditions. Even simple things such as cleaning and replenishing toilet paper stocks are often left to the landlord or property management in many short-stay leases, which can be both costly and time-consuming to keep up with.
With less ongoing maintenance, less turnover & fewer marketing requirements, long-term rental agreements work out to be significantly cheaper for property owners than their short-term counterparts. Plus, companies that specialise in short-term rentals are often significantly more expensive, charging 25% of rental income or more due to the added work associated with upkeep and management. This, coupled with the ensured tenancy discussed earlier, makes long-term rental agreements the best choice for property owners that are looking for ways to increase their ROI.
While both short-term and long-term rental arrangements have their benefits depending on the priorities of the property owner, the affordability and security of long-term agreements make them a perfect choice for those that want to increase their ROI. To learn more about what we can do to improve your property management experience, contact My Rental today!