Landlords recoup investments faster through Airbnb, study says

Owners of three-bedroom properties in Montreal, Toronto, and Vancouver can recoup their purchase price much faster through Airbnb over average rental rates, recent research revealed.

A study by British online real estate agency Nested ranked 75 cities around the world according to the time it took to recoup the average price of a three-bedroom property in their respective locales.   A higher ranking indicates a quicker return of investment through Airbnb.

Airbnb provided a faster return of investment for three-bedroom properties in all 75 cities except for Beijing, China, which placed last, the study showed.  Airbnb rates there would recoup one’s investment in 59 years and 6 months, versus 55 years and 10 months through average rent.

At 20th place, Montreal was the highest Canadian city in the list. The average cost of a three-bedroom property there stood at USD354,371. It takes six years and two months to recoup that figure through the average Airbnb rate (USD4,816 per month) compared to 22 years and 9 months for the comparable USD1,296 average monthly rate.

Toronto and Vancouver were at the bottom half of the rankings at 52nd and 68th respectively. A three-bedroom home in Toronto costs USD615,737 on average, Nested found.  It would take 24 years and 9 months to recoup that amount through USD2,073 a month. The Airbnb rate of USD4,577 would recoup the investment in 11 years and 3 months.

A three-bedroom home in Vancouver costs about USD865,344, Nested said. Airbnb’s USD4,037 rate would return that figure in 17 years and 10 months, versus the 28 years and 5 months of the average USD2,540 rent.

Durban, South Africa placed first, as it takes just a year and six months two recoup the average cost of a three-bedroom property there (USD94,343).

Nested found Hong Kong as the city with the highest average cost for a three-bedroom property (USD3.15m), followed by London (USD2.83m) and New York (USD2.17m).


Related stories:
To regulate or not to regulate?
Company targets investors, offers no-commission buying and selling
 

Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate

Get help choosing the best mortgage rate

Just fill in a few details, and we'll arrange for a Mortgage adviser to help you find the best mortgage for your needs

  • How soon do you want a mortgage?
  • Name
  • Where do you live?
  • Phone number
  • E-mail address

Industry news

Submit a press release

Poll

Do you invest in commercial properties?