Investing in apartments for rent currently in Ho Chi Minh City is one of the popular investment channels, bringing attractive profits for investors. The question is how to invest in rental apartments with high and stable profit?
As far as we know, there are two different business models in Saigon and Thao Dien rental market:
The first model is owned – leased, that is, you take your own house / apartment and rent that house / apartment.
The second model is rent – sublease, meaning you rent a house / apartment of another person and you renovate or re-divide the room to let someone else rent it at a higher price to enjoy the difference.
It can be seen that these two housing rental Thao Dien business models have quite different profit margins. If owning – leasing can bring an average profit of 5-10% per year, then the model of leasing – leasing can bring profits up to 50 to 100% per year. However, with the ownership – lease model, you will spend less effort and safety, while renting – renting apartments in Ho Chi Minh City is risky and requires you to have knowledge. better knowledge and business skills, and more management effort. Let’s take a look at the experience of investing apartments for rent quickly and safely below:
First experience in investing apartments for rent: Determining the purpose of investment
Most people who think about the rental business are focused on finding a good apartment for rent in Ho Chi Minh, or rent and then rent, without forgetting the important thing that their true desire is. The first thing you should do before thinking about HCMC apartment business is to clarify some of your questions such as: what is the capital you want to invest? Business model wants to stick? Regional locations will invest? Wanted rate of return? Future direction after making the deal? …
After you have answered all the above questions and figured out what you want, finding and sending information to search channels such as brokerage offices, online newspapers, paper newspapers … will bring You results are surprisingly accurate and effective.
Second experience in investing apartments for rent: Considering bank loans, applying financial leverage
The reality shows that the majority of successful real estate investors and traders in the world never use all their cash for a real estate transaction. Evidence for this is that the US President and real estate billionaire Donald Trump, in real estate business deals, he only spent 20% of the capital despite having a lot of cash in hand. Because of the real estate nature gives you the ability to use huge financial leverage from the bank. However, when using leverage, you need to pay attention to negative cash flow – the amount of principal and interest paid regularly to the bank. Please calculate and note that negative cash flow with positive cash flow from the rental to select the appropriate business model and deposit.
You can also raise capital from individuals in the form of investment co-operation and share a portion of their profits in proportion.
Third experience investing in apartments for rent: Negotiating effectively, mutual benefits
When buying land, buying houses for rent or even renting houses, the negotiation is very important. You should know that real estate is a valuable asset, so each negotiated difference is like the price per square meter, or a monthly rent reduction, if multiplied by the total area or the total The rental period is a pretty big number.
In addition, if you choose to rent – lease model in Saigon, the exploitation and cooperation with real estate owners is a long working process and has many impact factors. Therefore, there should be agreements to achieve an effective win-win situation: the landlord has good rental rates and long-term stability, and the sublease tenants also get a profit that is worth the effort. In my case, the new cooperation is long-term and durable.
The fourth experience investing apartments for rent: Renovating to optimize profit
Each apartment / house has wasted space that if businessmen can take advantage of and exploit, they can create value for other tenants or increase their profits.
When buying or renting a house / apartment for rent in Thao Dien, you need to observe those corners of space. Usually a large house / apartment has many rooms for rent, the kitchen on the ground floor is rarely used and cleaned. Instead of having that shared space cluttered in a way that “your father doesn’t cry”, you can turn it into a kitchen with a kitchen for guests who love to cook. On the rooftop, just a little bit of dexterity will become an artist-filled room with moonlight in the evening, or a miniature penthouse with green trees and grass decorated in the terrace in front of the room. those spaces are wasted and you will get a special Thao Dien apartment for rent with the best profit.
Experience of investing in an apartment for rent: Looking for target customers
The most common mistake made by rental real estate business people is to follow real estate brokers on the market, by marketing property with generic content to attract more tenants. with many different needs.
But the problem you, apartment investors rent, should remember that real estate brokers need to attract more customers because they have shopping carts of different products to advise. On the contrary, you only have one product for your rental, so do not waste time receiving guests with inappropriate needs. And the secret is to use the destination marketing method: thoroughly describe the characteristics of your rental property, the prices and the specific fees associated with real images of the real estate. Then put this information on channels that many customers search for such as real estate classifieds, newspapers …
The biggest thing to note is that you should not try to hide information, or use illustrations of other real estate, because when the Thao Dien apartment tenants come to see the house directly, they will also realize it. . So be honest with the marketing from the outset, you will get the target tenants – the ones that your house true to their interests and needs.
Sixth experience in investing a rental apartment: Post a rental news as soon as possible
The saying “Time is money” in the rental business is a literal statement. Because every day, every hour, every minute, every second goes by not renting your house, you have lost a corresponding amount of money. If anyone has ever done the rental – sublease model. The rent is already paid to the landlord and the room is not rented out, it will understand how terrible the feeling of losing money every day.
Therefore, the rental must be implemented at a fast pace and urgently. To do this, you need to prepare and rent before the house is completed. And another method I am using is to organize races for business teams to rent a house to find the winning team and deduct a portion of their monthly profits for them. If you are an individual making this model, you can apply the same by sending information of Thao Dien apartment rental to many brokers to create competition and race for renting your own house.