Everybody loves to have a good view when they look out of the window. A view of a beautiful beach or harbor can simply lift the spirit first thing in the morning. Are you considering purchasing an investment property with such a view because you think it can fetch a significantly higher rent? Then think again.
Due to the appeal of a view you should expect to pay a higher price when purchasing a property situated in such a prime location. But unfortunately a view has less impact on the rent return than you might assume. Yes a view is appealing but it will not generate a significantly higher rent return based on this feature alone.
Advantages of Purchasing a House with a Good View
The benefit of buying such a property is that the property value should increase at a quicker rate over time which will improve your profit when it comes time to sell.
Another benefit is when prospective tenants are faced with choosing between two similar properties, they will naturally chose the property with a better feature such has a view.
You also might expect to get more offers from tenants than your competitors if your property features a view.
A high occupancy rate at all times can bring in more rent for you even if the rent value is not as high as your expectation.
Drawbacks of Purchasing a Property with a Good View
It is obvious that you will be able to charge a higher rent for your property because of the view that it offers. However, your pool of potential tenants may also reduce based on the higher price range that the property will be offered at, some people may not be able to afford the higher rent.
According to the latest statistics, the average weekly income for families in Albany is approx $1,500. In such a case, people may choose to live in the suburbs rather than near the beach or centre of the city. A good view may not be enough of an incentive for them to consider a higher rent.
You should always consider both sides of the coin when investing in a property. Location and views can assist in a higher rental return but there is a price to pay and your short-term gains may be less than anticipated.