Welcome to the world of Corporate Rental! Excited to become a corporate landlord? Not sure how to start? Let’s look at some things to know before you take the plunge.
Flexible? Where to Buy Your New Executive Rental
If you’re able to buy anywhere, you should think about these factors.
First, what areas or cities are growing economically? Where do people need luxury rentals? Project work and corporate relocation are main reasons tenants look for short-term housing. So is the temporary need for medical expertise or a long-term shortage of it. Do some research into areas where these situations are frequent. For example, places with lots of military bases or oil companies will need furnished rentals for relocating staff, since people in these careers move often. Also, rapidly growing cities are good because they attract construction professionals and travel nurses.
Second, how do local laws, taxes, regulations, costs, impact your investment? Be sure to fully study local laws regarding temporary housing rentals and taxes, utility costs in that area, etc. These things can have a great impact on your bottom line. Look for areas with low costs and taxes and minimal regulations.
Finally, be sure it’s a place you’ll want to visit often. Not only will you visit when setting up the home or for upkeep, you may want to use it for your own travel.
Will Your Corporate Tenants Want The City or The ‘Burbs?
Once you’ve picked a region or city, you need to zoom in. Where within that place should you buy? This depends, and there are many pros and cons.
Look at where the city you’ve chosen is growing. Is there a downtown or inner city being redeveloped? Is there a “hot” place to live? Are the suburbs expanding? The best choice is to buy where your tenants will want to live.
This also depends on your target tenant. Relocating families will need larger, family homes close to their new work locations. Temporary project workers will want to be close to the office but don’t need a big home because they tend to travel solo or as a couple. Know your city and the type of corporate tenants that come there so you know what location is best. Other key aspects are:
1) Walkability – The CHBO walk score takes into account how easy it is to live without a car. The scale looks like this:
- 90–100 Walker’s Paradise – Daily errands do not require a car
- 70–89 Very Walkable – Most errands can be accomplished on foot
- 50–69 Somewhat Walkable – Some errands can be done on foot
- 25–49 Car-Dependent – Most errands require a car
- 0–24 Car-Dependent – Almost all errands require a car
Zillow.com discovered that Walkability in metro areas means your property is more likely rise in value and less likely to fall in value during downturns. Corporate tenants tend to value Walkability highly. You should too.
2) Crime and Safety – All corporate tenants have one thing in common. They want to live in safe places. So be sure you check crime reports for the areas you are considering. If possible, drive through the area and look for signs that it’s a high crime area such as burglar bars on windows or doors, more police presence than normal, and an excess of litter are examples.
3) Ambiance – Tree lined boulevards, parks and flowers, local retailers of interesting wares, friendly pubs and roadside cafes, beautiful views in the distance. There’s a charm to certain neighborhoods, and these are just some of the things that add to that charm. Seek out areas with ambiance.
4) Convenience – No one likes the grind of a long commute, no matter the method of travel. Try to find properties that offer close access to public transport, major roads, and the airport. You’ll need to balance closeness to these systems with the noise that can result, but a few blocks away is usually far enough. Research the area and be sure that parks, fitness centers, medical care, groceries and shopping aren’t far either.
What Type of Home to Buy?
You’ve found the perfect town and the perfect location. Now, what type of home to invest in?
- Condominiums have the benefit of lots of common amenities like pools and fitness centers, on-site property management, and covered parking. They tend to be found in denser, urban areas but can also be located in suburbs as they sprawl out from the city. Safety and noise tend to be a bigger concern with apartments. Some benefit from a Condo Association that set rules making the entire property more desirable.
- Townhomes are the mid point between apartments and single-family homes and tend be found, like apartments, in areas where land is at a premium. You’ll benefit from a lower price than a comparable single family home, and some maintenance and common landscaping is provided. You won’t have a yard however, and typically stricter HOA’s may limit pets and have noise restrictions. Townhomes are a good balance overall and offer lots of space while still being located in more urban parts of town.
- Single Family Homes give your corporate tenants more privacy, and may feel more like home. Executives, especially traveling with their family, will insist on the additional space. If you’re targeting long-term tenants, locating near a good school district could be important. Amenities are private, and yards tend to be larger. Single-family homes tend to have covenant or HOA agreements as well, which limit variety.
Remember that the kind of property can depend on the location. For example, a city without a well developed downtown wouldn’t be a place to buy a downtown loft. A city like Austin, on the other hand, has a hip urban central area and urban condos and townhomes are more desirable. Also try to look for properties with amenities that go hand in hand with the area or climate. A lake house should have a dock; a home in a hot, humid city should have a pool, etc.
These guidelines are a good starting point for basing your decision where to locate your furnished corporate rental. The CHBO Handbook can help you navigate your way in the successful world of corporate rentals. Have more questions? Feel free to call CHBO and get expert help toll free at 877.333.2426 today!