What kind of apartment can I buy for tenement?

The popularity of such an investment is due to the fact that rental housing prices are growing faster than the cost of square meters. So the profit is 8-12% per year. Accordingly, in about 10 years, the apartment is fully paid off, and the investor begins to receive a net profit. On top of that, the housing, if necessary, can always be sold, and you can immediately received a large amount of money.

However, it is important to understand how to choose an apartment for tenement. It depends on an apartment chosen what the monthly income will be and for what will be the period of fully pay out of investments.

What kind of apartments are better for lease?

A lot of potential investors are interested in what apartments are the better for rent. Regardless of the city, the most popular are small apartments with good cosmetic repairs and convenient location.

The real estate market is literally oversaturated with spacious apartments, which, if can be rented out at all, then only for a short period. This is an unstable investment, because the overwhelming majority of Ukrainians prefer to rent small but cosy apartments. These include:

• studio apartment with their own kitchen and bathroom;
• modern open-plan smart apartments in new buildings;
• one-room and two-room apartments in the secondary real estate market.

Renting out luxury apartments at their market price is much more difficult than finding a tenant for a regular apartment. This is especially true for small towns. Speaking about Kyiv and other large Ukrainian cities, luxury apartments are more in demand in them, but in any case it will not be easy to rent them out.

Another important point in choosing an apartment for subsequent lease is its location. Most renters are looking for accommodation within walking distance of the metro. Along with this, it does not always matter which station is nearby, the very fact that the metro is nearby is important. The proximity to the metro automatically increases the rental price by 30-40%, which means that the monthly income of the lessor also grows.

When figuring out how to choose an apartment for tenement, do not forget about such factors as the condition of housing, infrastructure nearby, transport interchange and its distance from downtown. It is much easier to find clients if at least not the most expensive, but high-quality repairs has been made in the apartment. Besides, the presence of schools, kindergartens, supermarkets and shopping centers nearby is great virtue. And, of course, there should be other public transport nearby along with the metro. All these requirements are primarily relevant to economy housing, as well as apartments in the middle price segment.

If you want to rent an expensive apartment with a luxurious renovation and a magnificent view from the window, you first need to think about whether to buy such an apartment, because there is no guarantee that it can be rented out for a long time, but the cost of its maintenance is quite high. Although if you are already buying expensive apartments for subsequent lease, you have to choose an apartment not far from the city centre or in it. Everything should certainly be all right with parking nearby.

In which district of Kyiv is it better to buy an apartment for tenement?

If you are planning to lease an apartment in Kyiv, this is a great solution. Firstly, there is a huge number of students in Kyiv, many of them do not live in student hostels, but are looking for inexpensive apartments. Secondly, Kyiv has some of the highest rental prices, so a good profit is  guaranteed. Thirdly, the city is visited by many tourists who can rent housing for a short time at high prices.

The key point in buying an apartment for rent is the choice of the appropriate district. The best districts of Kyiv for hiring out an apartment are: Holosiivskyi, Sviatoshynskyi, Obolonskyi and Darnytskyi. These are cosy sleeping districts with a well-developed infrastructure and a convenient location. Some of these areas are situated not far from the city's leading universities, which means they will be of interest to students. In such areas, the most popular is budget housing, which is often rented by young families and students, again.

Rental housing in Pecherskyi district can be distinguished into a separate category. A small apartment in the historic centre is more expensive than a luxury penthouse on the outskirts of the city. Such an apartment can be repaired and then rented out for a lot of money. In particular, such apartments are in demand for the holidays.

How to choose?

If the question arises, is it profitable to buy an apartment for lease, the answer is unequivocal: “yes”. The main thing is to choose the property right. Here are some helpful tips for a successful real estate investment:

• If you want the fastest possible payback, buy housing for lease in a new building at the excavation stage. It can be possible to buy such an apartment even with a mortgage, and the profitability of this investment may exceed 10% of the cost of housing per month. With the rise in rental prices, this is not the limit.
• Consider the floor and age of the house. For subsequent tenement, it is better to choose the middle floors in houses that are not prepared for resettlement.
• Get to know your neighbours before buying. Moreover, it’s necessary to get to know your neighbours anyway, regardless of the purpose you purchase the housing. It is worth making sure that alcoholics and other antisocial elements do not live nearby. It is much more difficult to find long-term tenants for an apartment with bad neighbours.
• If you want to lease apartments you buy in new buildings, it is better to buy from reliable companies. If you are interested in an apartment in Kyiv or Lviv, contact RIEL Real Estate Corporation – it has been occupying a leading position in the Ukrainian real estate market since 2003, and during its existence it has commissioned more than 50 modern objects. And many of the offered apartments are perfect for investment and their further lease.

What counts most is to remember that most tenants are interested in housing with a small area and a convenient location. And buying an apartment for lease, you should take into account what kind of them are sort after.