The real estate industry is one of the best practical investment options for those looking to generate passive income. This includes those who own a condominium for compact living and aim to earn passive income and source of monthly cash flow through their investment property.
If you’re one of the condo owners who wish to grow your wealth over time through rental properties, this article from Asterra uncovers top five (5) passive income real estate investment opportunities through your condominium unit.
Top 7 Passive Income Opportunities for Condo Owners
Rent out your condo unit
Renting out your condo unit is one of the most common yet effective ways to generate passive income as a condo owner. Leasing your unit to tenants enables you to earn a steady stream of rental income each month. It could be a long-term or a short-term rental, such as six months to a year.
This setup allows you to leverage your rental property to create consistent cash flow without having to be greatly involved in day-to-day property management, which could be both exhausting and stressful. What is more, condo unit rental can help offset ownership costs from your mortgage payments, property taxes, and maintenance fees.
It’s your financially savvy option to maximize your investment returns as a condo owner.
Your parking space, too
Did you know that you can actually rent out your parking spot? If your condo unit comes with one that’s assigned, it’s wise to rent it out to generate real estate passive income. Take advantage of the fact that many areas posed for growth face a shortage of parking spaces.
This is particularly true in high-demand condo neighborhoods or areas with limited parking options. Essentially, if you don’t own a car, you can rent out your parking space to those who do, especially those who may are not able to buy an entire parking space, which makes renting the best option.
You can do so on a monthly basis for long-term tenants, or offer it for short-term periods for visitors and even commuters.
Turn it into a vacation rental
Yet another lucrative passive income opportunity for condo owners is to convert their property into a vacation rental. This is a smart choice for those who have a unit as their second home, of for those who purchased a property that they only live in on special occasions.
It’s also a great way for passive income in real estate among overseas Filipinos looking to build their wealth through real estate investments. With all this said, turning your property into a vacation rental would definitely attract travelers and tourists who prefer the effortless convenience and comfort of staying in vertical homes or condos over traditional hotels.
If your condo property is situated nearby a popular tourist destination, or in emerging locations in Greater Manila Area (GMA) and regional areas nationwide, you can expect a high demand among vacationers looking for temporary accommodation.
Take advantage of pre-selling condo units
Purchasing pre-selling condo units does not only entitle condo buyers discounted prices, it also serves as an excellent opportunity for prospective condo owners to earn passive income with minimal upfront investment.
That is because developers offer pre-selling units at lower prices to lure early buyers who could help with the financing for construction, making it a win-win situation for both developers and buyers.
Therefore, you can capitalize on this by purchasing a pre-selling unit and, upon project completion and once the property is fully ready for immediate occupancy, you can sell your RFO unit at a higher price to potential tenants.
Consider property flipping
At its most basic, flipping a condo property is the practice of buying a real estate property and later sell it for quick profit.
While it’s true that flipping typically comprising buying distressed or undervalued properties, renovating them into thoughtfully designed spaces to increase their market value is the practical solution. You can use it to justify selling them at a higher price than the amount you initially bought it with prior to making the necessary upgrades and renovations.
Flipping a condominium unit allows owners like you to greatly benefit from real estate market opportunities to create passive income through the strategic buying and selling of real estate properties.
Real estate investment trusts (REITs)
If you’re a real estate investing beginner, this passive income strategy may be your best option. A real estate investment trust is an excellent alternative for generating passive income without having to directly own physical properties.
REITs are companies that own, operate, or finance income-generating real estate across various sectors, from residential, commercial, to industrial properties. Investing in REITs enables condo owners to gain exposure to a diversified portfolio of real estate assets. By extension, it allows you to earn dividends from rental income and property appreciation.
As opposed to direct property ownership and management, investing in REITs entails liquidity, diversification, and professional management. This is a fantastic option for passive investors who particularly seek to generate income from real estate without the often-daunting responsibility of property management.
List your condo on Airbnb
Finally, it’s platforms like Airbnb that have revolutionized the way in which people travel and book accommodations. If you’re a condo owner or in the process of buying one mainly for passive income purposes, listing your condo on Airbnb presents you with a great opportunity to earn through short-term rentals.
A lot of travelers, both local and international, trust Airbnb and similar platforms when on the lookout for temporary lodging options while on a non-working holiday or a weekend getaway with friends or family members. You have the flexibility and option to rent it for long-term tenants or focus on short-term renting if you still intend to use your property as your personal sanctuary during off season.
For practical living in compact spaces with open greens and growing cityscape in the background, Asterra offers value-packed condominiums for those looking to secure their first home as well as those searching for a starter home property to rent out for passive income.
Our properties boast exclusive amenities that provide best value for money, including a fitness center, sports court, play area for kids, outdoor gardens, a multipurpose community lounge, tranquil landscapes, and pool for relaxation.
