July 21, 2022

A new, better way to do Airbnb?

Miko Truszkowski

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Summer is the high season for short term rentals but the city has cracked down on Airbnb's

During the summer months is when Airbnb rentals get the most business. 

In 2019 like in 2021, Q3 revenues were twice higher than Q1 revenues. When tourism soars, Airbnb business tends to grow two fold: on the one hand, tourists travel and rent places to vacation in, and on the other hand, they vacate their space and take this opportunity to rent it out.

Airbnb in Toronto has been a gold mine in the past decade, so much so that the amount of hosts has grown exponentially in Toronto over that period. In 2019, 6% of the Toronto Waterfront community (City Place & the Islands) was listed on Airbnb making it in the TOP 5 Airbnb areas in the country.

With such success and great cash flow perspective, more and more investors started purchasing units with the sole goal of listing them for short term rentals. In 2020, 48% of Airbnb hosts were listing 2 or more properties at once.

In 2019, several news sources (including the CBC quoted above) started reporting on the impact of short term rental properties on the housing market. "Apartments left empty are driving the prices through the roof, and the city must take action".

In 2021, the city has finally implemented new regulations that have impacted this business greatly: investment properties are no longer allowed to be listed for short term rental (less than 28 days) and every host has to purchase a license from the city to operate.

With these regulations halting the business of purchasing units to generate strong passive income, investors need to turn to new alternatives... and there are some great ones!

Fully Managed Resorts: the alternative

Fully Managed Resorts are the new Eldorado for positive cash-flows. Much like Airbnb, these properties allow for revenue that will far exceed regular long-term leases, with no impact on cost of ownership. The plus here however, is that they are fully managed:

  • You invest in a condo unit in a resort
  • You get to enjoy all the resort amenities whenever you want - in your home
  • When you're not using it, you can chose to have it rented out through the resort itself!

Freed Resorts is pioneering that model with already a successful track record: Muskoka Bay Resorts has been a very successful investment for many of our clients, and their two new projects show great promise: Horseshoe Residences & Deerhurst Resort.

We are currently selling Horseshoe Resort as a VIP Platinum brokerage, and have ran a number of simulations to estimate the revenue... and we're surprised by how attractive this investment is! Ask us about our calculator at precon@connect.ca!

Learn more about horseshoe resort: https://www.freedresortsandhotels.ca/






DISCLAIMER: The simulation in this article is provided for informational purposes only. It should not be considered or relied upon as advice by Connect Asset Management Corp. or Connect.ca Realty and should also not be considered as a substitute for professional advice or recommendation on real estate investing. Connect Asset Management Corp. or Connect.ca Realty shall not accept any responsibility or liability of whatsoever nature for or in connection with any use of or reliance on the historical assumptions for this or any real estate development project it is contracted to sell on behalf of a developer by any person. Nothing here is or shall be considered as any recommendation or offer or solicitation to offer of any investment product.

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