Hotel Room Investment Review

Alternative Investments

We have recently produced a new guide for hotel room investments, giving you comprehensive details about investing in this attractive alternative property asset.

Hotel room investment’s are one of the best decisions you can make.

It offers you several advantages over other investment opportunities. They enable you to diversify your income with a high return on investment. The hotel market is gaining popularity, with great opportunities domestically and abroad. What sets this investment apart from others is the passive source of income it generates. You enjoy stress free management since your hotel unit is fully managed and serviced. You only collect your revenue at the agreed time.

Go for the Luxury Hotel Market

Many people tend to choose 2 and 3 star hotels when they are making this important investment. Although they produce significant returns, the problem occurs when there is an economic downtown. Since they are budget hotels, any economic setback affects their business and as a result, there are minimal returns due to reduced clientele.

However, the luxury hotel market is rarely affected by economic downturns. This implies that its revenue remains stable throughout. As such, it is a more secure hotel investment compared to the budget 2 and 3 star hotels.

Attractive investment returns

When you invest in hotels, you are bound to realise huge returns. Additionally, there are minimal expenses. This is because most of the maintenance work is handled by an experienced team of professionals.

This is much better, compared to the minimal returns obtained from residential properties that mainly yield returns of around 5%. Property owners also have to deal with difficult tenants, looking for tenants, paperwork and other issues.

Strong growth in capital is another reason why you should consider hotel room investments. With a good location, your hotel investment will continue appreciating within a short period.

This is not the case with the property market, as it tends to stagnate. With the changing needs of travellers and the right branding, investing in hotels is the way to go.

Tax efficiency is a major benefit when it comes to investing in hotels. Since hotels are ranked in the same category as commercial properties, there are many tax-efficient opportunities available which means additional returns on your investment.

Investing in the hotel sector is easy, when you consider that a hotel is naturally divided by rooms and therefore making it simple and easy to register the title at the land registry and at the same time it is simple in terms of working out which room generated revenue for each individual investor. If you have the opportunity to purchase a hotel room, get the right location and you can do tremendously well over the medium term.

Simple and Straightforward

Investing in a hotel is easy and simple the moment you have identified the right investment. It is not like stocks, where there is nothing tangible; you are investing into already existing structures. This implies that your investment is based on tangible assets and is not paper based. Therefore, you have security and peace of mind.

You do not require a huge capital outlay to invest in the current hotel market. A full hotel room investment can cost you as little as £15,000. You do not require loans or mortgages.

Additionally, all the paperwork is processed and ready. You just make your investment and you are ready to start getting returns immediately. Once you have amassed enough profits, you can decide to opt out.

There are several exit strategies available. You can opt for a buy-back that is usually guaranteed, as long as your investment is over a certain period of time. With this arrangement, you will sell the property at a profit, on top of the returns you will have made during the period that you owned it. This makes it a worthy investment.

Selecting the Right Hotel Room Investment

Having made the decision about investing in hotels, the challenging part is identifying the right hotel that will give a high return on investment. This requires a specific skill set. There is a wide range of hotels to choose from, all offering investment opportunities.

You need to be careful in order to identify the right developer, the hotelier, and the location. These are all key attributes in determining your success with the hotel investment. However, you do not need to do this on your own.

There are experts who are specialised in this field. They will use their market skills to help you select a secure hotel investment. They will also help you identify a hotel with the safest and strongest income all year round, for a long time.

Bottom Line

There are many reasons why you should invest in hotels. Once you identify the right hotel to invest in, you are guaranteed a stable and secure income all year round. It is a secure form of investment with high returns. Professionals will help you every step of the way from identifying the right hotel and all the legal paperwork.

FJP Investment is a team of investment specialists sourcing a wide range of investment opportunities both in the UK and overseas, including hotel room investments.