Miami is a popular city for both tourists and expats from all over the world. Whether you’ve made the Magic City your home or are an investor looking for opportunities, the prospect of becoming an owner in this dynamic real estate market is probably something you’ve considered. For many, this means buying into a building, not only due to the skyrocketing costs of single family homes, but as an attractive option due to the amenities and proximity to all the fun and useful things you’ll be able to walk to in minutes.
The major option to consider then is basically due to the ‘AirBnB Revolution’ that has occurred, and which cities have dealt with in a variety of ways. On a personal level, the thought process goes something like this: some folks don’t like the idea of strangers touching their stuff, so case closed. However, others who travel a significant amount of time would like to use the opportunity to make some extra cash by renting their apartment in their absence. As long as the short-term tenants don’t leave a mess, this can work out. However, what about the loud music that said tourists have going until 3 am? The owners aren’t bothered, but the neighbors are. You probably know stories about this kind of thing or have experienced it first hand. It creates a potential conflict to have both part-time and full-time residents in the same building. The Miami approach to this issue has been to separate these two approaches to living at the building level. In other words, long-term rental buildings are designed primarily for full-time residents and have a minimum rental lease term of generally 6 to 12 months.
The interesting opportunity that has arrived is in the form of the short-term rental building. These residences fully embrace the AirBnb-type model, offering owners the ability to rent their units for very short periods of time. Most of these buildings offer furnished apartments and in-house rental management, for a truly turn-key lifestyle. From what you’ve already thought about and read so far, you may already have an idea whether a short-term or long-term rental building is right for you, but in case you are still on the fence, here are a few important considerations.
A long-term rental building is probably the best choice for you primarily if you won’t be traveling that much and wouldn’t have the opportunity to rent short-term anyway. If you are really making this your home, you will probably want to get to know your neighbors with some consistency and will enjoy the stability. Of course, if you do decide to take that sabbatical to Tahiti for the year, you can always rent your apartment if you don’t want to sell. You can vet and approve a single tenant instead of worrying about the gang of hooligans who are squatting at your place for the night. This type of arrangement is also much better if you want to decorate and use your own furniture, so this will be a plus. No one will be going through your things, and you don’t have to clean up after yourself when you do leave for the weekend if that’s your thing. Also, if you fit into the lifestyle, you will enjoy the advantage of a being able to spend significantly less for your apartment, as these types of buildings often are priced well below their short-term counterparts.
On the other hand, if you will only be in Miami for part of the year, or will be traveling extensively, the short-term option may be ideal for you. You will pay more for the apartment, but will have the income stream from the rentals while you are away. The amenities for most of these building are top-notch, so when you are here, you can really enjoy yourself. Note that, if you do plan to be in Miami for a significant part of the year, we have seen buildings that actually penalize the owner if he/she stays in the unit too long! So make sure you read the fine print of the contract.
Now you may also be an investor who is just that, looking to make a real estate investment in this particular property and doesn’t plan to live in the apartment at all. You might be wondering whether you will make a greater profit with short-term or long-term rentals. While short-term rentals bring in more money for high-occupancy rates, these aren’t guaranteed and come with additional potential hassles. In future posts we’ll be crunching some numbers for example investments so you can get an idea which option might be right for you. Until then, let us know if you have any questions or if we can assist you 😊