Rent to rent Concept
I’m diving into the concept of Rent to Rent and sharing a step-by-step guide on how you can identify potential opportunities. Rent to Rent is a versatile strategy suitable for both new and experienced investors. It allows for quick cash flow within a few weeks, requiring minimal capital for a high return on investment. It serves as an excellent testing ground for new strategies before committing to property purchases.
Now, Rent to Rent involves renting a property from an owner, guaranteeing them a rental income, and then renting it out at a higher rate. This could be due to better management or utilizing the space differently. For instance, taking on a licensed HMO that’s underperforming for various reasons.
Passive income?
Rent to Rent isn’t a passive income stream. It requires active management, taking time and effort, which could turn into a full-time property management job without proper systems in place. Additionally, you don’t benefit from the property’s capital growth, as it reverts to the owner after a certain period.
You might consider converting a Rent to Rent agreement into a Purchase Lease Option, providing the right to buy. While more powerful, not all landlords agree to this, opting for the guaranteed rent from a Rent to Rent deal.
My personal plan involves renting to the Airbnb market in 2023. This aligns with the Rent to Rent concept, renting from the owner and offering the property to the Airbnb clients.
How to spot a rent to rent opportunity
When looking for Rent to Rent opportunities, focus on landlords struggling to rent out their properties. They might have an HMO set up but face challenges, such as being distant landlords or poorly managed by letting agents. To find these opportunities, visit property listing websites like www.spareroom.co.uk, targeting landlords actively seeking tenants. Look for properties with less impressive ads but great potential, as these might be the ones overlooked by others.
Contact Landlords
Contact these landlords expressing your interest in renting a room. Avoid mentioning guaranteed rent initially to bypass platform algorithms. It’s essential to understand the landlord’s challenges and ensure they’re fixable. While it involves reaching out to several landlords and many might not be interested initially, the money is often in the follow-up. Give this strategy a try in your area and see if it aligns with your investment goals
If you’re a landlord wanting to utilize our services speak with one of our team who would be willing to look at your property, giving you a quick answer on whether we can take over the management and agree a deal.
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