Tip 4: Consider rental yield when planning your real estate project
We have said before that buying a property in the mountains is a leisure investment. Nevertheless, this should not prevent you from thinking about opportunities to generate an income from your investment. In fact, if managed properly, it is possible that the rental income generated by your future property will cover your annual overheads as well as the costs of your own stays in your second home such as travel, lift passes, etc.
To begin with, you need to determine how much of the time your property will be occupied. If you expect to use your property yourself several times a year during school holidays and holiday weekends (i.e. during periods of high demand), then this will have an inevitable impact on your overall occupancy rate. Taking this into account when carrying out rental simulations and income forecasts will help you avoid disappointment and will also help you to select the best resort. It is better to choose a resort that is easy for you to get to, even if it is less busy, if you plan to go there regularly.
That said, whatever the resort, also consider the layout of your property from a rental perspective in order to maximise occupancy when you are not using it yourself. If you have four bedrooms, put double or twin beds in each of them to give a sleeping capacity of eight people, even if your own family is just two adults and two children.
Finally, ask yourself whether you want to buy a new or older property. From a rental standpoint, new properties offer the best potential to quickly generate optimised rental income, as well as allowing you to reclaim the VAT on the purchase price. This will allow you to make a more financially viable investment, even though the initial acquisition price may be higher than for an older property. The latter will be preferred by clients looking for premium locations with ski-in/ski-out access, as well as character.