The rental cottage strategy, which consists of buying a cottage in a well-located sector and renting it out for the evening, the weekend or the week, makes it possible to rent a secondary residence on a short-term basis and enjoy it personally when it is not rented. It’s a good compromise for those who want a chalet, but who don’t plan to use it every weekend.
Imagine owning a cottage in the Laurentians, and simply renting it out when you’re not living there pays for the expenses for the whole year. You would thus have a completely paid-for chalet that costs you nothing and that you can enjoy for a few weeks a year whenever you feel like it.
Obviously, you must be comfortable with the fact that groups and young people will be staying in your cottage, and that there will surely be parties, parties and some breakages. If you don’t mind, know that the rental cottage could be an extremely interesting strategy for you and a wonderful compromise if you want to buy a cottage at a lower cost.
But it’s not just chalets, we can also talk about second homes in the broad sense. Rental second homes, regardless of their type, can be very profitable and can be a frankly very profitable strategy in the end.
Investing in real estate: there are not only PLEX in life!
PLEX, PLEX and PLEX! It is probably around these 3 strategies that you are currently simmering. We go around quickly, and some people are looking for alternative solutions to invest in real estate. We’ll tell each other once and for all, as interesting as they may be, there are not only PLEX in life!
For example, some investors buy or build houses in the suburbs of certain large cities, then rent them with annual leases. In the region of Quebec, it is something common, and the good houses are rented quickly. On the other hand, investors cannot benefit from their property, since it is generally rented to tenants for a long period. It’s a bit like renting an income building, but with only one tenant! The house, if it is well located, will retain its value and your tenant will take care of paying for it over time. You can possibly go live in it if you want, or resell it in a market that is generally easier than that of multi-housing.
Thinking of investing in a chalet not too far from Montreal? Discover the most beautiful chalets for sale within a 2-hour drive from Montreal!
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Nevertheless, THE strategy most loved by young investors in recent years is undoubtedly the rental chalet. No one enjoys a cottage 365 days a year, far from it! So why not buy a chalet to rent it, and to go and enjoy it for a few weeks a year when it is free? It’s the perfect compromise! The rental chalet is a bit like a hotel, because you will have to rent it by the night, week or weekend. It’s more management, and it requires more expenses in general. On the other hand, the prices per night are attractive, and when you do the math, you generally need an occupancy rate that is not that high to enter into these costs.
Obviously, it depends on a TON of factors, but the profitability of a rental cottage, under the right conditions, can be attractive.
But why invest in the purchase of a second home?
Not everyone is cut out to handle lots of tenants or have a quieter investment. Some investors are looking for simplicity, and others like projects that are constantly evolving.
For the case of buying a second home with the aim of renting it out, investors generally use this strategy, as it greatly simplifies management. There is only one tenant, and we generally know better how a house works than a multi-unit building. Psychologically, it’s often less stress! In addition, rental homes are very attractive to older tenants who cannot afford to buy a home because of the down payment, but who are looking for an alternative solution. So you can provide it to them.
As for the rental chalet, it can be a very interesting alternative when you want to be able to enjoy chalet life at a lower cost. We rent the chalet most of the year, while reserving a few weeks through to enjoy it with friends and family during special occasions. The most beautiful ? It will cost you practically nothing, if it is absolutely nothing! You will have a chalet, possibly free!
In addition, chalets that are well located generally increase in value over time, and the market is fairly balanced. Of course, managing a rental chalet can seem tedious and extremely demanding, especially when renting on a very short term, however, there are management companies specializing in the field. For a management fee, you can buy peace of mind! This is usually what investors do, as it allows them to manage all their other projects and not have to deal with renting, cleaning, tenant inquiries, etc.
The second home for long-term rental can therefore be a guarantee of simplicity, and the short-term rental of vacation units can be an interesting strategy to take advantage of all the advantages of a chalet, while obtaining a good return. that the tenants pay all the expenses of the building.
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There are no fundamentally good answers to this question, since many factors are important to consider. Generally, the purchase of a PLEX is a relatively simple and stable investment, insofar as your role is simply to find tenants wishing to live in the building for a certain period of time (minimum 1 year usually). The risk is therefore quite moderate, the return is often easy to calculate, the expenses are predictable and there is not much left to chance.