What are the best investment flats?
The mortgage market remains subdued, so many prospective buyers are waiting for a better opportunity to purchase a property. This situation benefits owners of rental flats, as demand for them remains consistently high. Which types of flats and locations are most sought after? And how can you adapt a property effectively to let it more easily and at a higher price?
The best flats for investment
Flats with 2+1 and 2+KK layouts are the most popular choice. Most prospective tenants prefer flats with an area of up to 40 m2. As interest in rental housing grows, so do prices, prompting a reassessment of how much living space we actually need. Demand is focused on smaller flats, but location is also crucial. Flats in regional cities are the most popular.
Where to buy an investment flat
Prague, Brno, towns in the Central Bohemian Region and regional cities are among the locations with the greatest demand for rental flats. Not only the city itself but also the property's location within it is important. Flats in the city centre generally let more easily than those on the outskirts. Local amenities and transport links are also key. In Prague, flats close to a metro station or at least a tram stop are in greatest demand.
Demand for rental properties
Current statistics indicate that demand for rental flats exceeds supply, with dozens of prospective tenants responding to a single listing. This gives landlords confidence that their property will not stand empty. Often, just a few minor improvements are enough to let a flat at a higher price.
Flat furnishings
If you are unsure whether to let a furnished or unfurnished flat, the best option is a middle ground. It is important to give tenants sufficient space for their own furnishings. Basic furniture such as wardrobes, beds or sofas is recommended. Also invest in storage space. Furniture should be easy to repair, and a combination of more expensive and lower-cost items will make replacement straightforward. Kitchen appliances, a functional bathroom, a washing machine and lighting should not be overlooked either.
The risk of tenants failing to pay rent
Landlords face an ongoing risk from tenants who fail to pay rent and from high turnover. These problems can be avoided in two ways. Rent should be set at a reasonable level. Although landlords can now afford to increase prices, there is a risk that potential tenants will seek cheaper alternatives. It is therefore important to tailor the price to the location, furnishings and layout, and to thoroughly vet tenants before signing the lease agreement.
Professional management of investment properties
In the long term, it is more efficient to entrust the management of a rental property to professionals who will ensure occupancy and secure reliable tenants. This step is crucial. We screen tenants against debtor registers, giving us confidence that issues with rent payments and similar matters will not arise. Owners pay a monthly commission for property management, but professionally managed properties achieve higher occupancy and returns, making the service worthwhile.