07 Dec Bristol Building Surveyors see Increase in AirBnB Property Purchases
AirBnB properties are constantly in and out of the news, reflecting their disruption of the rental market. Bristol investors have seen the potential in these holiday homes – our surveyors have noticed a strong upward trend in city centre apartments being bought by investors specifically for use as short-term lets.
These properties are attractive investments, with a relatively low cost and great revenue potential. One of the properties we surveyed recently was on the market for a modest £199,950 and was generating an impressive £25,200 a year in AirBnB fees.
According to AirDNA, the short-term rental intelligence platform, the Bristol/Bath area currently has over 4000 listings, three-quarters of which are entire homes. The market is, however, anything but flooded, with occupancy rates up 9% compared with the previous year, and average revenue steady at £38K/year.
It therefore comes as no surprise that investors are snapping up properties with short-term rental potential. Selection of properties is key to success. As Bristol building surveyor Chris Dunstan said, “I’ve noticed a sharp uptick in small inner-city properties being bought up as Air B&B investments – I’ve had 3 in the past week alone.”
The houses and flats bought in Bristol for AirBnBs tend to have unique properties that are appealing to tourists looking for an instagrammable place in one of Britain’s quirkiest cities. As Chris notes “We commonly see small, quirky 1-bed apartments bought by investors to use as short-term lets. City centre is a particularly attractive place to buy, with BS1 properties making up the majority of AirBnB lets that we survey for would-be buyers.”
As with any investment property, getting a building survey to understand its condition and the budget needed for repairs and maintenance is crucial when weighing up the pros and cons of buying a home to use as an AirBnB. Particularly in today’s market, with high interest rates making mortgage repayments more significant than they were a couple of years ago, investors need to be fully informed on a property to judge whether or not they will get the returns they need.
In addition to getting a thorough survey of an investment AirBnB house or flat, buyers should ensure their conveyancer checks legal restrictions around using the property for short-term lets, including any local planning requirements and whether HMO regulations apply. The rental market is going through a difficult time, with a shortage of long-term lets and a plethora of second-home short rentals. Future government legislation is expected to impose additional planning restrictions for properties changing use from residential to short-term lets, and buyers need to be aware of these potential changes.