24 May, 2023
Unlock the doors to real estate success
Read time: 5 minutes
Not only an Investment, but also a Retreat


Image source: Forbes

Come, let us beat this summer heat with a trip to the hills of Kashmir. Sometime back I took my family for a vacation to India’s Switzerland.

All of us want to be our most relaxed selves on holidays but it was a different experience for me this time. No doubt I was having a great time but at the same time I was discovering a new source of income in real estate.

In this edition, I want to move away from the prevalent status quo in real estate investing and show you a whole new ally of it altogether.

Every investment opportunity brings along with it a certain amount of risk. But what if I were to say, there is an investment avenue that is not only rewarding in the long run but also profitable in the short run, and all of this without any significant risk.

What? You think such opportunities are mere mirages and do not exist? Well then you are yet to know about Vacation Rentals.

Over the past few weeks with the holiday season setting in, people have been retreating to hill stations or the sea shores. There are high chances that you must have seen your mates or your cousins living in lush bungalows at these touristy places.

The times have changed. A large chunk of tourists no longer books hotels when visiting a place, instead they opt for vacation rentals.

Why? You get freedom, it is cheaper, and it is a whole new experience altogether!

I experienced these advantages first-hand during my trip to Kashmir. We ditched the orthodox hotel stays and opted to stay in a well-fournished cabin located at the outskirts of Srinagar. Overlooking the lush-greenery and snow-capped mountains, I was having the time of my life with my family!

It is now easier than ever to book these hill cabins or beach houses via platforms such as AirBnb, Expedia, Vrbo, and others.

Now these are mere platforms from where customers can rent the properties for use, you must be wondering where is the investment angle? Well, let’s dig into that now straight away.

Ever since the COVID-19 pandemic struck, our living ideologies have changed. We now see how fragile and uncertain human life is.

The world now wants to work, earn, and live a happy life all at the same time and not wait for the happy days to come.

People no longer divide their lives into work now, play later, the new normal is work now, play now.

Amidst a rising cost of living, everyone wants to have a passive income, without devoting a lot of time into the same. All of these conditions taken into account, give rise to the investment in Vacation Rentals. Now these can be apartments, or homes, or condos, or even small cabins in the woods.

The money that you invest in these properties do not only provide you short-term returns through rental income, but also provide you an opportunity to blow the steam every now and then.

If you are wondering why has this phenomenon started all of a sudden? Well, while there is a plethora of factors, the key reason once again is the COVID-19 pandemic.

During the pandemic, employees were forced to adopt to the culture of Work-From-Home. Turns out people perceived this as Aapda Mein Avsar!

Even though the pandemic is no longer a global emergency, it paved way for Remote Work opportunities even in sectors that couldn’t think of it operating in this manner. What followed was, people earned handsomely but were restricted to the four walls of their room, so they took a pragmatic approach.

Those who could perform their jobs remotely were no longer doing it sitting within the four walls of their houses, they travelled to destinations like Shimla or Nainital or Gangtok or Goa. Here, people rented bungalows or apartments along with their mates and are now making the most out of their lives while working a 9 to 5!

Tourist destinations are no longer seasonal, they are now perennial.

Now if you are looking to make an investment in the real estate sector, a factor you must take in is,

What good is money if you can’t enjoy it?

Upon investing in a rental property, you can enjoy it for years, earn passive income through rents while platforms such as AirBnB and others manage the property and take care of renting it out. At the end, you can sell the property, all while earning a hefty profit as this business is now on the rise.

Over the past few years, I have witnessed the Millennials making the most out of this opportunity. Those born during the late 80s and the early 90s have perhaps been working a corporate job for the past 5-10 years.

It is now not money that they yearn for, but an escape from the everyday hustle and bustle.

Vacation homes provide the perfect opportunity for these city dwellers to enjoy some much-needed fresh air and an opportunity to venture out into the greens. Moreover, while earlier you could take leaves for up to a week perhaps, now with the culture of Remote Work, you can be vacationing for months all while improving your bank balance.

Now, I have discussed why you should invest in these properties and how they are beneficial to you both in the long and short term, but can you?

Are these vacation rental homes affordable?

Well, when compared to real estate prices in metropolitan cities and other tier 1 and tier 2 towns, properties in popular tourist destinations are much more affordable.

In the past week, the government announced plans to build 8 new cities in the country. This shows that the current metropolitan cities are now no longer able to accommodate more people, the haphazard expansion of these cities is not only harming the environment but prices have gone through the roof!

With remote work on the rise and a spirit to live in the moment kicking in, now is perhaps the most opportune moment to buy that piece of real estate in a tourist destination. In the years to come, the prices will rise inevitably.

Now to conclude my views, vacation properties, whether they are apartments or bungalows or cabins, offer a quirky mix of utility and adventure. The key benefits of investing in this opportunity are:

  • Offers an escape from the monotonous city life
  • A great source of passive income
  • A chance to earn hefty profits, with property price rise inevitable

Moreover, with tourist destinations no longer having a traditional peak season, finding tenants to your property is easier than ever. At the same time, studies suggest that people are now increasingly occupying these rentals for a time period of 21-30 days, unlike the earlier 5-7 days stay in the hotels.

This reflects positively on the future of vacation rentals as a business opportunity.

Now that’s all from my side for this week’s edition of the Open House, I hope you will now keep an eye on everything related to these vacation properties.

Until the next one, eat mangoes, stay hydrated, perhaps take a holiday break with your loved ones and remember,

Opportunities are like sunrises. If you wait too long, you miss them.

Disclaimer: This newsletter is intended for informational purposes only and should not be construed as professional advice.

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By Ashwinder R. Singh
Step up your real estate game with exclusive access to tribal knowledge accumulated over decades.
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