Anyone had any luck with Positive geared holiday rentals

Doubt it – my holiday home is a emotional decision not investment – yes I can rent it in summer and certain ‘event’ weekends – ye phillip island….but i’m not one for sharing. A perm rental will certainly leave me short and not positive. Yield is not attractive in these areas as is the same with capital growth and investments such as these are usually driven by person use and not investment. Thats my view anyways

Cheers Ivan

Hi Scott,

Keen to understand if this is a realistic option to consider for positive geared options.

This totally depends on WHAT and WHERE the holiday rental property is. e.g. if Gold Coast, then holiday times can command a good rate BUT it can languish through the rest of the year, unless you have the time or ability to manage an airbnb style short-term rental. This then adds heaps more time/cost in managing the laundry/cleaning and promoting further guest visits.

Or, it could be a “tree change” style rental in a forest or up a mountain. If this is a place that regularly draws people to stay on weekends, AND the short-term rental price can trump the usual long-term rental on a lease, it COULD be viable and positive geared.

Some plusses of this kind of rental (usually weekends only) are that it remains available for you when not rented. It is also often available through the week for setting things right (cleaning, getting tradies in to fix things, etc) ahead of the next visit.

To be successful, supply and demand is key – but so too is the capability to absorb the extra costs of preparing the place between each visit. Positive geared, possible but not a given. e.g. even if you can regularly book a weekend and AND this is at double or triple the rent of a standard lease, HOW MUCH of the profit disappears in taking care of the place? If you can get around that one, it can be a winner.

Economic hard-times will affect this rental style too. We are still struggling to get back to the levels we enjoyed up to mid-2013 !!

Benny