Retirement communities catering to those over 55 pose a question for Real Estate Buyers: Is it beneficial to invest in properties in these communities? There are a variety of factors to take into consideration when you’re considering an investment property that is specialized to this and analyzing the advantages and disadvantages is one option to assist in making the right choice. Here are a few advantages and disadvantages which are associated with investing within retirement community communities.
● Maintenance included one of the major benefits for retirement properties is that a lot of them come with maintenance included. This could include snow removal, lawn care and a few projects for exterior maintenance. While you’ll have to be charged in exchange for the services you receive, they will surely save you time and perhaps even save you money over the long haul and also. Additionally, it’s great not to worry about all that!
● Amenities the majority of 55+ communities offer facilities on-site which make them attractive areas to live in. Walking trails, swimming pools, clubs, clubhouses, and even recreational areas are just a few of the facilities that are commonly available. These are significant advertising points, so make sure and highlight these to prospective renters.
● Wear and tear- for property owners who own rental properties wear and tear on the property is always a worry. If you rent to older tenants however, this generally is not as much of a problem. In the beginning, there is usually just one or two residents living in the apartment. This means that there is less wear and wear and tear. Also, there aren’t any children who live there all the time which is a good thing, as we know that kids can wreak havoc on an area.
● Fewer vacant positions many older individuals reside in retirement homes for a number of years. Moving can be stressful and expensive and those who belong to this age group usually do not want to handle it. This is great for home owners who are able to be sure of regular income and less vacancies.
● Streamlined Advertising If you’re in a particular region, such as an older neighborhood marketing strategy is much more efficient. You are aware of who your prospective renters are and can adjust your marketing strategy to appeal directly to them, rather than trying to appeal to a large spectrum of renters.
● Less Properties the number of homes that are available to purchase is significantly less in retirement communities. Instead of searching across a large market or city instead, you’re focusing on specific, small-scale areas. Naturally, there are less options.
● Limited tenant pool it’s the same idea in your tenant pool. While you may benefit from simplified marketing, you’re excluding an enormous portion of renters if you concentrate only on people who are over 55.
● The HOA costs a majority of, if not all retirement communities have HOA costs and some of them are quite high. You should go through these fees thoroughly to determine what they cover and whether they’re reasonable (remember that you’ll be accountable for these even if the property is empty). No matter if you decide to pay these fees yourself, let your tenant pay for them or even split the cost, these charges will impact the rent you charge for rent. You must consider this when you evaluate the financials of the property.
● Long-term profits the last thing to note is that long-term gains (i.e. appreciation) could not be as great for this type of property. They tend to appreciate slower than those with no restrictions, so be certain to study the past appreciation rates and determine whether this will be an issue for you.
The age group of 55 and over is among the fastest-growing groups of renters in the U.S., and there’s plenty of those who are looking for homes. There are plenty of positive aspects of renting to this group of people. But there are potential drawbacks that must be taken into account prior to making a decision to buy a home. Before you sign the contract, make certain to weigh the advantages and disadvantages, in addition to the risks and rewards you’re likely to face with this specific property kind.
Vairt is a Crowdfunding Platform for Investing, tokenizing and liquidating real estate assets through Block chain. Once you are ready to make an investment, you can make an investment in less than 2 minutes. Sit back and relax as your property gets funded. Vairt analyzes Property Investment Opportunities using a 100-point proprietary screening tool and independent third-party market data to assess the investment attractiveness of each property. We give you the Opportunity to Invest in Real Estate for as little as $5000. All properties on our platform are listed for 30 days to give investors ample time to raise funds.