What You Need to Know About Buying a beach house for rental income


Is investing in a beach house for rental income worth it? Owning a beach house property is a great opportunity to earn a stable income by renting it out during the peak season when you’re not using it. Not only do you have your own holiday escape but you’ve also got a steady source of income.

Things to consider before buying a beach house for rental income

When buying a beach house, it might be a very emotional decision often done after convincing yourself of how beautiful it is and it’s location. But investing in a beach house is a big commitment and being able to keep a budget in mind before an auction is important. It’s a big financial step to own a beach house.

Here is a list of some things to consider before buying a beach house for rental income.

  • Maintenance

Every property needs regular maintenance to keep it looking its best. When guests are paying to stay at your beach house to enjoy a relaxing holiday they expect to find a clean comfortable property with things in good working order. To maintain regular rental bookings and to keep your income stream flowing you want to receive good reviews, as guests usually look at reviews for positive recommendations. Beach houses located close to beaches can be affected by the weather, including strong winds and sea salt spray which over time can damage outdoor furniture and the exterior of the property. Plus having multiple guests stay at your home can lead to an increased chance of damage to furniture, appliances and overall wear and tear. There is also a possibility of break-in or vandalism if your beach house is left unattended for a long period of time.

  • Investment potential

When investing in property you need to consider its potential to earn a good return on investment, through rental income, capital gain, and the future resale of the property. Understanding the location while looking at potential beach house properties is very important. Is it in a growth area where property values will increase over time, or perhaps in a sought-after established area? Other considerations should be easy access to the beach, proximity to shops and restaurants, and leisure activities such as golf, sailing, and wineries. The size of the beach house and how many guests it can accommodate are also important. Properties in Blairgowrie, Sorrento, and Portsea are ideally located, although prices are increasing in these popular areas.

  • Insurance & Taxes

Many properties by the beach have high taxes and as an owner, you need to factor these significant costs in.. Even the cost of buying a beach house is higher as you move closer to the water. It’s important to do prior research on home insurance with the different fees involved and details on the insurance coverage before settling on an insurance cover for your beach house property especially if your intention is to rent it out for holiday/short stays.

  • Property Management

When it comes to buying a beach house for rental income there will be a lot of property management firms that have listings around all the popular destinations near the beach. Prior research on what different management companies offer and the cost involved is important to get the best deal. It’s also important to read reviews and testimonials from owners who’ve used property management services before.

  • Tax deductions on investment properties

Owning investment properties might help in claiming tax deductions like depreciation and the costs to set up the beach house for holiday rental and short stays with furniture, appliances, and linen to maximize returns. Any repairs and maintenance required can be claimed within the same financial year as well. The tax deductions on investment properties can help make the right property choices.

In the long run, buying a beach house for rental income is a great step for an additional income stream. And it’s important to have the right property management company to trust and support you before making a decision of owning a beach house property that you want to rent out.

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