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TrainsRenting out housing is one of the easiest ways to earn passive income, and travel with this money. Of course, objectively speaking, after the events of 2014, the yield from renting apartments fell sharply, and in some cities it became even less than the income from deposits in banks. But if this question is approached with a rational calculation, profitability can be increased.
We have already mentioned how to make money on renting housing among other ways in our article "How to make money on travel", now let's take a closer look and compare the different options:
Delivery for a long time
Renting for a long time implies a period of several months or more. This is the easiest way, because it does not require constant care of the apartment and frequent meetings with clients, which is especially true if you like to travel. After all, it is enough to meet with tenants once or twice a year, conclude a contract and quietly go traveling. You can receive money through the bank remotely, and then you will not be tied to the place of delivery at all. But there is a downside: the yield of a long term is very much inferior to short-term rent, and often even inferior to the yield on deposits in banks. And in order to travel with this money, you may have to rent not one or even two apartments, but much more.
On the other hand, in most non - tourist cities, the demand for short-term rental housing is so weak that it may be less profitable than long-term, and in this case, renting for a long time is generally the only option.
Short term delivery
This is a great way to earn money and get to know other travelers, if, Of course, your city is in sufficient demand from tourists. Sometimes you can successfully rent short-term housing to people who come on business trips, in developed business and shopping areas, even in small cities.
Renting housing for a short period of time can be done in several ways, at least such as:
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Through agencies or stewards
There are such people or real estate agencies that can rent your apartment for a long time and will themselves rent it for a short time to travelers or business travelers, take care of cleaning and repair if necessary. At the same time, in the contract with a person or agency, such use of the apartment is immediately stipulated, and the price will be slightly higher. In our experience, agencies offer a higher price by only 20% of the usual long-term lease, but you can agree on more, it all depends on the region. But a huge minus is that by the time the contract expires, the apartment comes almost into disrepair, and you will have to make repairs in it, replace furniture and appliances.
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Through friends and free ads on forums and social networks
It works well only in popular resort places, where vacationers return again every season.
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Through paid ads on bulletin board sites like Avito/Domofond
In our experience, this method is much more effective than free Bulletin Boards, as in the previous version.
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Worldwide accommodation booking service Airbnb
Airbnb is the most popular platform in the world today for finding and renting private housing for a short term. Convenient for both tenant and landlord.
Advantages of the system:
- Adding a place to the search is free
- There is a guarantee against damage and theft of property for 1,000,000 dollars!!!
- Only 3% commission from the price you specified
- Great demand in popular tourist cities around the world.
In general, everything is great with Airbnb, but one thing is bad - another 15% service fee is added to the price you announced when booking, which is paid by the client. Accordingly, either you need to reduce the price by this amount, otherwise your ad will be uncompetitive. Oh, and another plus is a great interface and good support service.
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Worldwide hotel booking system
It's been years since Booking.com allows you to find not only hotels, but also private apartments. There is no guarantee from booking for the owners, and the commission is 15%, which in the end comes out even slightly lower than in Airbnb, if you take into account their "hidden" service fees from customers.
Advantages of the system:
- Adding a place to the search is free
- Very high potential demand, because booking is the most popular system in the world
- A developed system of reviews for all objects is exactly what attracts potential customers here.
- Your ad added to the booking will become searchable in a variety of hotel and accommodation search aggregators, which of course will hang the chances of delivery.
But there are a couple of disadvantages in booking that you should know about: a rather "clumsy" interface for tenants; a terrible support service in Russian, to which the Prophet simply can not get through or solve his problems.
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Russian systems Sutochno.ru, turum.ru and others
Sutochno.ru, Travelrent.com/, Turum.ru and others are little known outside of the Russian Federation, but if you mainly expect Russian guests, then you should add your object here. This is a great option if you rent housing in the Black Sea resorts of the Russian Federation, in Moscow, Kazan, Nizhny Novgorod and other places popular for domestic tourism. The commission in these systems is also about 10-15% of the booking price. There is no guarantee for the safety of the property, only guarantees for customers and landlords on mutual settlements as on the booking.
Which method of the proposed to choose? As you can see, there is no special difference in the size of commissions and conditions, except that Airbnb stands out thanks to a guarantee against damage to the owners. Therefore, it is best to combine several ways. But do not take it too lightly, because the task is not so simple. If you do not follow the delivery calendars well, you can have overlays on dates, followed by fines, negative reviews, and, of course, a drop in income after that. Therefore, each of the methods is better to master in turn, connect the next after the previous one.
Also analyze the offers in the specified systems in your city/district, and add first of all where there are more offers. Why more, not less, because there is less competition where there are fewer offers? And you put yourself in the place of a user who, for example, will find 500 accommodation options in Airbnb, and 50 options in Turum for example. Where do you think it will continue to pick up options next?
Security issues
When renting for a long time, the issue of the security of your property and the guarantee of payment is solved quite simply – everything is described in the lease agreement, and payment is usually in advance. If there are any problems with property or payment, they are solved by applying to law enforcement agencies and courts. As a rule, the first step is to apply to the police, where, most likely, a decision will be made to refuse to initiate criminal proceedings. But this must be done in order to then attach this resolution to the statement of claim to the court.
With a short-term lease, in case of problems, contacting law enforcement agencies may already bring problems to you, since the question of the legality of your activities may arise, and you may be charged with illegal entrepreneurship, for example, and even remember about the need to pay taxes. Therefore, experienced owners take a deposit at check-in, take out insurance against damage or theft of property.
Airbnb is very convenient in this regard, as it is stated that it offers insurance up to $ 1,000,000 Against Property Damage. But we, unfortunately, have no real experience of handling such cases, and the feedback of the owners could not be found. But there are plenty of reviews about how money was withheld from customers for damaged property, so it's worth assuming that this really works.
If you decide to reinsure yourself with the help of collateral from customers before settling in, Be sure to indicate this in the conditions when placing the object in the system or bulletin boards.
More tips for renting housing
And here are some more in our experience that will help you when renting housing for a long or short term.
- Make beautiful photos. It seems that there is nothing difficult in taking several photos of the room on a cell phone, but they will be of little use. Do not skimp on good lighting at the time of shooting, and on a good camera. Ask friends who have experience and good equipment, or invite a photographer for a fee.
- Stay with yourself. To create the most comfortable living conditions, try to live in your apartment for a couple of days. Surely there will be such trifles as an inconveniently located hanger, no hooks for towels in the bathroom, no place for toilet paper in the toilet, no mirror in the hallway, no TV from the bed, too hard mattress, etc.all these seem to be trifles, but they create a negative background for customers, and as a result bad reviews.
- Connect WiFi. Now it is almost impossible to rent housing without internet for a short period of time.
- Ask for feedback. Do not hesitate to ask to leave positive feedback in the booking systems of your guests.
- Place information signs and instructions. Information plates with the order of behavior, security rules, WiFi password, opening hours of the nearest shops and attractions, maps of the area, etc., will not interfere at all. with such information, guests will feel taken care of, as in a five-star hotel. In addition, signs like "when leaving, turn out the light" and "water is our wealth", take care of it, will really save your utility costs.
Whether to pay taxes, and how to do it
Of course, it is necessary to pay taxes, but it is obvious to everyone that only a few pay. The state is trying to restore order in this matter, but so far everything remains on the conscience of the owners, since the very fact of receiving from rental income is very difficult to prove, and there is simply no one to do this in the tax inspectorate.
If you decide to pay taxes, then it is quite simple to do this, especially if you did not register as an IP/PBOYL, which is not at all necessary when renting an apartment. We write it with all responsibility: it's really uncomplicated, maybe a little confused just the first time. You will have to pay 13% of the amount specified in the contract.
To do this, you need to independently submit a tax return on Form 3-Personal Income Tax to the tax inspectorate at the place of registration before April 30 of each year for the previous year. This means that if you rent a house in 2019, you will only need to report in 2019.
It is easy to fill out the declaration yourself with the help of the program, which is laid out annually at the beginning of the year on the website of the tax inspectorate here - https://www.nalog.ru/rn63/program/. You enter all the data into the program (do not forget about the income at the main place of work and other income), and it calculates the amount of tax required for payment. The declaration will need to be sent to the tax inspectorate by electronic means, by mail, or in person, and pay the calculated amount of tax by July 15, which, by the way, can also be done online.
If you decide to register an individual entrepreneur, you can reduce the amount of tax to 6%, but annual contributions to the pension fund (26,545 USD), the health insurance fund (5,840 USD) will be added. Another option is to buy a patent, but this is a completely different story.
