4 Excellent Advantages of Serviced Accommodation

Serviced accommodation is a type of real estate investment that consists of a fully furnished property that is available for short and long-term rentals, with the majority of them being short-term. This can be by month, week, or even night. Many landlords are unaware of the benefits of serviced accommodation (SA) and prefer not to investigate it further. After all, there are numerous common myths and objections to SA that are simply false. However, we believe that SA is a good investment option for you and will explain why. So, what are the advantages of Serviced Accommodation?

1. More profitable than a single let

SA is a good investment for several reasons. The first is that it is profitable. Serviced apartments, unlike other types of properties, can be charged on a per-night basis. Depending on the region, an apartment that would normally cost £1,000 per month could be charged around £140 per night.

Aside from that, SA units are far more tax efficient than single lets. Profits from furnished vacation rentals, for example, are included in relevant earnings for pension purposes. Furniture and other items purchased for the SA unit can also be claimed as capital allowances and tax relief.

Over time, you will realise that the tax benefits of owning a SA will likely save you thousands of pounds.

2. Typically has lower start-up costs and less competition than an HMO.

Although both are excellent property investment strategies, there are some distinctions between HMO and SA. SA is the best option for those looking to get started in business.

The SA market is younger and has less competition than the HMO market. Aside from that, serviced apartments are smaller and can be furnished for a low initial cost.

Furthermore, SAs do not have many rules and legislation, whereas starting an HMO business requires licencing and adhering to a strict set of rules. Many people believe they will face legal difficulties due to the lack of SA legislation. However, this is a SA business myth, like many others discussed in this article.

While the legislation protects HMOs, you can create a SA contract for the guests and choose how you want to be protected. The SA contract should include terms and conditions such as property damage penalties.

3. There are no voids or rent arrears.

Unlike long-term rentals, you’ll never have to worry about whether or not a SA guest pays the fees on time. They must pay in advance, and your earnings will be based solely on occupancy, rather than an AST monthly agreement.

4. Works everywhere, not just in tourist destinations for holidays.

Self-catering accommodations are another name for serviced apartments. This means that SA is used not only for vacation rentals, but also by businesses who prefer to rent rather than pay for a hotel room. So, if you’re worried that your SA will only work in a vacation tourist location, don’t be. This type of catering accommodation is required in the majority of locations.

The advantages of having your property serviced accommodation.

Serviced accommodation properties are excellent investments for those looking for a high return. They are, of course, a lot of work, but we can assist you every step of the way. For more information, please see our FAQ for those new to Serviced Accommodation.

Serviced apartments are extremely profitable when managed by a SA company like ours, as we have years of experience in the industry. If you want to hear from us, get in touch with Luxe Property Management and we’ll talk about your needs and help you take advantage of this excellent property investment opportunity.