Eurotrip: where are the most profitable rental locations?
In 2016, the United Nations World Tourism Organization (UNWTO) documented a new record: 1.235 billion international trips were made that year, 3.9% more than 2015. Europe accounts for almost half of the trips, making the continent the most popular destination for tourists around the world. According to UNWTO, travellers spent about $447.3 billion in 2016.
The rapid growth of tourism is a cue for both beginning and enterprising investors to take action. Real estate is one of the easiest investment vehicles, and online services are making property lease accessible to anyone with an internet connection. Tranio analysts have looked
One of the ways to evaluate tourist demand is to check the Airbnb page of the city in question. The index of AirDNA, a service that uses data from Airbnb to provide analytics, shows the frequency of accommodation bookings at a particular location. The calculations are based on the number of listings, growth dynamics, and the annual apartment occupancy rate (Figure 1).
According to the data, demand is the highest in Porto, Madrid, Lisbon, Athens, Dublin and Zurich among the 20 cities, while Frankfurt and Milan are the least popular. Athens is the leader in terms of supply growth speed
The price per square metre is an important factor that, along with the rental rate, determines investment yields when buying commercial property. According to Numbeo, of the 20 cities considered, property is cheapest in Athens
According to Numbeo, the most economical tourist rentals are found in Athens (€45/night), Budapest (€46) and Porto (€63). The most expensive cities are Dublin (€134), London (€141) and Amsterdam (€152) (Figure 3).
When considering the difference between prices per square metre and rental rates, the best locations to invest in property for tourist lease are Athens and Porto.
In certain countries, local authorities are trying to rein
In Portugal and Greece, the situation is less complicated. To lease real estate on a daily basis in Porto and Lisbon, owners only need to register their properties and obtain a special registration number. Regulations prohibit online platforms from publishing listings that are not registered. In Athens, owners are free to lease up to two properties for short terms not longer than 90 days a year if their incomes do not exceed €12,000.
Athens is one of the last European markets with low property prices since the 2008 crisis. At the same time, the city is becoming one of the most important tourist hubs in Europe: the number of tourists visiting Athens has almost doubled in the past 5 years. Investors now have the opportunity to buy cheap
(€2,000-3,000/m²)flats in central Athens and lease them for short terms, and can expect high yields (about 7%). If the Greek economy begins to recover, property prices can be expected to grow significantly, as they are now almost twice cheaper than before the crisis.
Originally published on globalpropertyguide.com