11 January 2023

Investment property owners can earn up to 30 per cent more with Guested short-stay platform

| Katrina Condie
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Living area

Guested short-stay properties are professionally styled and are ideal for workers staying in Canberra. Photo: Independent Property Group.

Just one year after switching their Braddon investment property from traditional leasing to the new Guested short-stay accommodation platform, Ben and Michael are already reaping the financial rewards.

“We have been with Guested since January 2022 and have seen significant returns month on month,” Ben said.

“We are planning to keep our short-stay arrangement, and this will allow us to look at buying another property, knowing we have the security of great returns, and that our team at Guested will keep our property in top shape.”

Independent Property Group’s new end-to-end short-stay management service, Guested, offers investment property owners the opportunity to unlock up to 30 per cent higher returns, while also offering greater flexibility.

Ben and Michael say of the many benefits to listing their property on short-stay platforms, the one they appreciate most is the flexibility.

With a short-term rental it couldn’t be simpler for owners to block out some time for family, friends or themselves to enjoy the property.

“The ability to be able to block out dates for an owner stay, or for us to make any improvements, is just so convenient when we are coming into town or we have family visiting,” Michael said.

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“The management and cleaning are completed seamlessly, and it is entirely stress free for us as owners.

“Then, of course, there is the benefit of higher returns each month versus a standard rental agreement.”

Guested offers a digital dashboard where owners can manage and view bookings, and track their performance and returns in real-time.

Ben and Michael found themselves using Guested after exploring different options for their rental property. After speaking to the team at Independent about what they wanted to achieve, they were presented a portfolio of different options, both traditional leasing and short-stay.

“Once we saw the pricing and found out that the cleaning and management was all included with short-stay, we just had to jump at the opportunity,” Ben said.

“The process to set up the apartment was very easy. The team at Guested provided us with all of the requirements that were needed to be in the apartment and guided us through every step.

“And if we require anything to be completed at the apartment, being that we are 250 kilometres away, our client relationship manager has acted swiftly and gone above and beyond to get things done.”

The owners are so happy with Guested that they are frequently recommending it to friends looking for a hassle-free service with a big financial benefit.

“Their personalised approach to our particular situation and the care they take with our property is second to none,” Michael added.

Bedroom

Guested property owners have the luxury of enjoying time in their own property between guest bookings. Photo: Independent Property Group.

When deciding if short-stay is right for an owner and their property, Independent will crunch the numbers and indicate the potential income that owners can receive.

For example, based on Airbnb figures, a two-bedroom property earning $600 per week as a long-term rental in Canberra could bring in $616 to $734 per week during the low season, $889 to $1059 per week during shoulder season and $1007 to $1199 per week during the high season when managed by Guested.

Based on those figures, the net revenue after management costs could be as high as $41,835 for short-stay, compared to $27,081 for a long-term rental.

Guested manager Ionna Hume says contemporary short-stay accommodation is highly sought-after for people travelling to Canberra for work or play.

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“Despite the impact of COVID-19, Canberra’s short-term rental market has remained strong,” Ionna said.

“With the appeal of our strong business sector, significant landmarks and tourism hotspots, visitors to the Capital are only predicted to increase.”

Professional styling, photography and marketing ensure Guested properties will stand out from the crowd. Accommodation is listed on multiple booking platforms including Airbnb, Booking.com and Stayz.

The Guested team will handle everything from bookings and payments to key handover, and there is 24-hour guest support service.

While Canberra houses, apartments and townhouses can all be managed through Guested, properties do need to meet the modern traveller’s needs. The good news is that the team at Independent Property Group can use their knowledge of the Canberra market to recommend the best solution for each property and investor.

Speak to the professional Guested property management team at Independent Property Group to see if your property is suitable and earn up to 30 per cent higher returns.

REGION MEDIA PARTNER CONTENT

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Capital Retro9:25 am 05 Jan 23

Still no explanation to clarify if an owner occupied property can also be an investment property and if so, how is it done?

Capital Retro,
The details on the tax impacts of using all or part of your house as an investment/rental are on the ATO website. It definitely impacts on the CGT exemption for main residences, it’s treated as running a business out of the property:

https://www.ato.gov.au/individuals/capital-gains-tax/property-and-capital-gains-tax/your-main-residence-(home)/

devils_advocate1:25 pm 04 Jan 23

This was the predictable market response resulting from the increasingly draconian changes to the residential tenancies act, imposed by the current ACT “government”

So what you’re saying is that short term rentals need more regulatory controls or taxes to rebalance the market?

devils_advocate3:24 pm 04 Jan 23

Nope. The answer is to remove ineffective and counterproductive regulation and distortionary taxes and let the market “balance” itself

Exactly devils advocates, whole reason airbnb and short term stays offer “30% more” return on investment as it is a way to circumvent the exorbitant land tax and rates that landlords are forced to pay by this gutless government.

I agree they should remove ineffective and counter-productive regulation, but the definition of where that applies is debatable, particularly when self interest is often driving certain peoples opinions.

And most taxes are distortionary to some degree so thats a bit meaningless without wider context.

The question is where best to tax and how to minimise those distortions to achieve a more efficient system. Which will lead to better outcomes for individuals and society as a whole.

Taxes on investment properties aren’t even close to the top of the list of where reductions are needed, they already receive far too generous overall treatment, when we should be encouraging investment in far more productive areas of the economy.

Capital Retro10:32 pm 04 Jan 23

But chewy, you are always defending the ACT governments’ new way of applying land rates, especially when people like me criticize it. But that’s self-interest, isn’t it.

devils_advocate11:28 pm 04 Jan 23

Nope. If you want more of something you pay a subsidy. If you want less of something you impose a tax.

Imposing a deadweight loss

Devils Advocate,
Good point, we want less investment properties because they distort the housing market so that less people overall are able to own their own home through across the board increases in prices from the incentives currently given.

So we should tax them more (through removing concessions), I agree.

And CR, yes, you wanting to not have to pay taxes through rates is based mainly from your own self interest, rather than any economic argument. Not sure where you were going with that point either.

devils_advocate10:38 am 05 Jan 23

Yes we should remove “negative gearing” concessions which allow people to deduct rental losses from PAYG income

Income and losses should be quarantined the same as other business or capital income.

Yes, this will concentrate rental property ownership in the hands of fewer landlords (those who can offset profitable rental properties against loss makers) but will bring the tax system into line across the board.

And of course remove the punitive land taxes in the ACT which exist on top of rates payments and stamp duty.

Agree@ Sam and Devils Advocate, the housing laws and exorbitant land taxes in Canberra are prohibitive and are a reason for so much homelessness. If the government genuinely wanted to reduce rents and reduce homelessness, they would be encouraging people to open up rooms in their homes (so many Canberrans have spare bedrooms), and rent out their properties to help others without the government always interfering or trying to get money from it. Government interference (creating strict rules for housing, creating so many regulations, and red tape, high land taxes and harsh laws against landlords), actually increase the rental prices and deter people from providing rental housing. Many landlords will move towards short-term stays, as the current tenancy system is too proscriptive and draconian.

devils_advocate12:25 pm 05 Jan 23

Well, sure they’re taxing the life out of existing rental properties, but the good news is they’re reducing regulatory hurdles, delays and deadweight tax losses to support developers in bringing new supply to the market…

LMAOOOOOOOOOOO

This is one of the major reasons why there is such a massive housing crisis, creating a growing number of homeless, employed people. Short term rentals like AirBnB, this ^^^, and similar, are putting short term gains ahead of any social responsibility. I don’t understand why the owner of a rental property would prefer short term rentals, in preference to long term renters. A stable income would have to be better than sporadic amounts. The fact that this is being pushed by a real estate company, who would know, how dire the long term rental market is, just makes it obvious, that money is more important.

devils_advocate2:19 pm 04 Jan 23

“I don’t understand why the owner of a rental property would prefer short term rentals, in preference to long term renters.”

The first reason, explained in the article, is
1) Higher financial returns. This is probably a big driver given interest rate movements, and ongoing rates and land tax increases.
Other reasons are likely to include:
2) much greater flexibility if you want to return to the property or sell it or remodel it, when compared with a residential lease (which can no longer be terminated outside specific exemptions during the periodic tenancy)
3) the ability to price the property in line with market prices, rather than potentially being locked in to below-market prices on an ongoing lease under the residential tenancies act
4) greater control in terms of how the property is used (e.g. a short-term lease could prohibit pets, whereas a residential tenancy effectively removes this choice from the landlord)
A range of other reasons however to my mind these would be some of the main drivers

@Bladeau, you are right that most owners would prefer a stable income and longer-term tenants. However, the current tenancy system in the ACT discourages that. The problem is that under the current tenancy laws, the ACT govt allows tenants to stay as long as they want in the property (the reasons for landlords to evict are extremely limited), rent prices are capped to CPI and market rent cannot be charged (but the government increases ACT land taxes beyond CPI every year), tenants can treat rental properties badly and there is nothing much landlords can do. Plus all the new safety and energy laws that only apply to landlords are really only about making life more difficult for landlords (otherwise the new home laws would apply to all homeowners across the board, not just rental properties). Long term leases favour tenants and disadvantage landlords, so no doubt many landlords will move towards these short-term leases as they would prefer the flexibility that these short-term rentals offer.

Capital Retro8:26 am 04 Jan 23

If the main place of residence is used also as an investment property providing short term rental income, what are the implications for preserving the “owner occupier” capital gain tax exemption?

I’m interested in knowing the answer to this too. A lot depends on individual circumstances and dates lived in the property etc. However, it seems you cannot get the full CGT main residence exemption if you used any part of your dwelling to produce income (like rent out a room in your house or Air Bnb it). Depending on individual circumstances, it seems the ATO can apportion parts of the property, and owners may get a partial CGT exemption, because they used part of the dwelling to produce assessable income.

devils_advocate2:26 pm 04 Jan 23

I presume this approach is presented as an alternative to the traditional “negatively geared investment property” approach of a long-term lease, tax deductibility of losses and a 50% CGT discount when (if) sold for a profit

Capital Retro4:15 pm 04 Jan 23

That appears to be the only way that it could work.

Creative accounting at it’s worst.

I’ll take “why people hate landlords” for $200 thanks Alex.

devils_advocate1:24 pm 04 Jan 23

Sure let’s play. For $200, why do people hate landlords, Heavs?

Finagen_Freeman6:46 am 04 Jan 23

What a lovely advert for the Guested. Scripted to perfection.

devils_advocate3:27 pm 04 Jan 23

It does indicated at the end of the article that it’s sponsored content…

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