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The continued growth of Dubai’s tourism sector, coupled with an increase in the sophistication of tourists in general, is encouraging investors to diversify their property investments by tapping into the holiday home and hotel apartment markets. Visitors are staying for longer periods as they feel much more at home in fully managed serviced apartments or villas, which in turn drives investor confidence.
The average stay in a hotel is three to five days, based on a survey conducted by the Dubai Tourism and Commerce Marketing (DTCM). We have clients who prefer having their own property, as it gives them a greater sense of freedom and much more space to relax in a home-away-from-home environment. Furthermore, investors and foreign property owners can visit Dubai more often and stay in their own property whenever it is not rented out to holidaymakers, although this is not an option when the property is rented out on a yearly contract.
We have seen a steady increase in the number of our clients choosing to bank their properties in the holiday rental pool, giving them far greater flexibility to use the property themselves, while still gaining a healthy return when the property is rented out.
With the increased level of occupancy, currently hitting above 90 per cent, property owners are realising returns at much higher levels than traditional long-term contracts due to the higher revenues for short-term rental. One of the perks of renting property out to holidaymakers rather than long-term residents is you can increase your prices during the peak season, in some instances almost twice as much. Of course, managing property for short-term letting is a headache for any owner, which is why a fully licensed broker for short-term and holiday rental is essential. At P K Holiday Home Rental LLC, one of the few companies licensed and regulated for short-term rental, the majority of our clients have day jobs and don’t have time to self-manage their properties. When tapping the services of a broker, new regulation dictates the terms and conditions the broker must adhere to, bringing more security for both property owners and tenants.
So how do you make your property available for short-term or holiday rental and enjoy greater rental revenue? The first step is to partner with a fully licensed broker, which could help in purchasing the right property and in registering it in a short-term or holiday rental pool. The broker must have a proven track record in marketing property, taking bookings and dealing with all administrative work, such as deposits and rental agreements. The broker will also be responsible for housekeeping and cleaning services and management of the property.
Short-term rental property must be furnished as per DTCM requirements and classified as either standard or deluxe. A property manager that has its own interior design team will make it easier to transform a property into a valuable asset, which can be an invaluable hassle-free option for property owners. At P K Holiday Home Rental, we also provide insurance coverage for major issues, offering both property owner and guests full protection.
One of the most common reasons why people choose to rent out their property is to cover their expenses and offset mortgage payments, while their assets’ value grows each year. The same can be said for property purchased as a holiday home. Purchasing property purely for personal use can be expensive, especially if you have a mortgage to cover. This is another important factor to consider when buying property as a holiday home. By utilising a “property pool” you can enjoy the property for any number of weeks, while making it available for holiday rental for the rest of the year. And why not? It’s your property, so why not make it work for you.
Source: Simon Said, Special to Property Weekly
Managing Director, PK Holiday Home Rental LLC
Al Nisr Publishing accepts no liability for the views or opinions expressed in this column, or for the consequences of any actions taken on the basis of the information provided.