As Airbnb becomes more and more entrenched into the economy, the desire for knowledge around leveraging it as an investment is becoming more pronounced. If you’ve made up your mind, the next question on your list is usually about where to invest.
There is no doubt that Sydney and the areas around the CBD itself have a high rate of demand, but here are a few reasons to consider a suburb that may have flown under the radar.
Firstly, let’s dive into the basics of Airbnb and short term rental investment.
WHAT IS AN AIRBNB INVESTMENT?
Website Mashvisor.com puts it perfectly:
“Having an Airbnb investment property means joining the union of tourism and real estate – two huge industries.”
It’s basically an investment property that is set up for short-term rentals via the Airbnb platform. The benefit of listing on this platform is the sheer number of hits the website gets daily, thus allowing you to leverage from the traffic.
Despite being launched 10-odd years ago, information about Airbnb investment in Australia is not easy to find. A search for ‘short-term rental investments’ returns a little more information and a short read will show that we don’t need to convince you that it’s actually a smart choice. Overall, the numbers look positive.
On the consumer side, Airbnb (and short term rentals) are popular because they offer flexibility, as well as accommodation in less traditional areas (important when you need to stay outside tourist areas), and they are cost-effective. A recent comparison study by Finder found that Airbnb did save consumers money.
IS THERE A DEMAND FOR ACCOMMODATION IN LIVERPOOL?
The Liverpool area has been seeing an increase in visitors since 2011. Its current status as a tourist ‘launchpad’ is definitely set to change with the raft of infrastructure coming to the area, including the hospital upgrade, aerotropolis and more.
Already we are seeing the local government put this into practice, with the implementation of a Western Sydney Visitor Economic Strategy. This strategy aims to develop plans such as;
maximise business events sector opportunities
maximise the opportunity presented by growing the educational sector
maximise the opportunity presented by the three planned new medical precincts at Westmead, Penrith and Liverpool
What does this mean for tourism and the potential of an Airbnb investment?
On a more practical level, this means that the opportunities to attract overnight visitors (thus ensuring an increased occupancy rate) are endless. The NSW government already in 2017 had a goal of doubling visitor intake by 2020, and Western Sydney was considered key in meeting that target.
The numbers are promising. We spoke to Angela Carrick, founder of host management company AirDesign Australia, who told us that Liverpool has seen a growing demand for holiday rentals, up 40% since Q3 2016.
Given the above, it’s reasonable to say that visitors, and therefore potential seekers of accommodation in the area are likely to be generated from the below areas:
World-leading hospital precinct
This could see visitors coming to Liverpool for professional purposes (short-term work projects), on-the-job training (medical students), and for visiting family or friends who are in hospital.
Western Sydney University’s Liverpool City Campus is home to around 5,000 students, and UOW’s South West Sydney campus has been built to host 7,000 students by 2020. The opportunity for educational tourism is endless here. This includes people taking up posts as visiting teaching and research staff and family and friends of international and interstate students.
Badgery’s Creek Aerotropolis
This project’s contribution to the area’s visitor numbers will be huge. Firstly, it will contain a curfew free airport, making it likely that visitors may be stopping in nearby Liverpool for their first night/s (not unreasonable given its proximity to places like Wed n’ Wild, Blue Mountains and Warwick Farm Racecourse). Western Sydney Airport is expected to see 5 million passengers in 2026. The aerotropolis itself will host education, industrial and business precincts, with further opportunities for increased arrivals.
We asked Quirin Schwaighofer, co-founder of MadeComfy (a company that specialises in managing Airbnb investment for rentals) for his thoughts. He indicated that Liverpool could very well see similar interest levels as the CBD, due to the number of growth factors. “New infrastructure such as an airport and other transit hubs can open new opportunities for profitable short-term rental in areas previously not popular on Airbnb”, he said. Residential areas such as Wolli Creek and Mascot near Kingsford Smith are already popular for Airbnb accommodation, “particularly for international travellers departing or arriving at awkward hours on long-distance flights”. With no flight curfews in place, Western Sydney Airport’s emergence could see visitors checking in and out of Liverpool accommodation around the clock.
The number of global distribution centres and head offices located in Liverpool presents the opportunity for business tourism as international and interstate staff visit for training and meeting. A strategy is also in place to implement an increase in MICE (meetings, incentives, conferences and events) in the area,
Family and leisure
Liverpool is one of Sydney’s most multicultural areas. This presents a huge opportunity to capture tourists visiting relatives, especially with the airport a stone’s throw away. Liverpool’s proximity to popular wedding venues (many gardens and historic houses in the area) also presents a positive opportunity from guests of interstate destination weddings.
Liverpool has a vast array of sports event friendly locations, as well as proximity to Sydney Olympic Park. The area is also home to a huge racing industry, which attracts local and international visitors, including Warwick Farm Racecourse and Inglis Stables (currently undergoing a massive overhaul, incorporating a luxury 5-star Sofitel).
WHAT TYPE OF ACCOMMODATION WOULD BE BEST FOR AN AIRBNB?
The consensus is that properties that are homely, yet clean, modern and with character rank the best. Quality interiors also matter. Being close to public transport is another huge factor.
You’ll need to consider whether you will be letting out the whole property, or acting as a “host” (where you are a resident and rent out part of your property only). It’s also best to stay up to date with the rules governing short-stay apartments. Click here for current NSW regulations.
Angela at AirDesign Australia told us that the most sought after size in Liverpool is 2.1 bedrooms (2 bathroom and a secure car space is the ideal).
Furthermore, Angela added that, ‘‘the most sought after features are air conditioning, heating, washer and separate dryer, full kitchen facilities, parking, high-speed internet and wifi”. The great news is that North Residences is fully equipped with all these features.