‘We can help landlords triple their monthly rental income’
A paramedic and his friend have launched a new business giving a boost to buy-to-let by helping renters 'feeling the squeeze' make more cash.
The Good Host has been set up by paramedic Ollie Krol, 31, and his digital product designer pal John Ellison, 28, as a way of helping landlords – hit by increasing government regulation – make more money from their homes. Instead of renting houses long term for people to live in, the duo promote them for short one or two night stays on sites like Airbnb.
Instead of getting on average £650-£700 a month on a terraced house in, say, north city, you can earn from £55-£95 a night, say the pair.
It's a growing trend in London and Manchester, but despite there being more than 330 homes currently hosted on Airbnb in Norwich alone, there aren't agents managing them.
'It all started when I decided to go travelling and I needed to rent my property for six months, said Ollie, who owns a two bedroom terraced house in the NR3 postcode area of north city. 'I wasn't keen on going down the estate agent route. I didn't want to remove all my furniture and pay for storage. My friend John had just moved to Norwich after a career in 'Silicon Valley' and he suggested using platforms like Airbnb.'
You can as much as triple your monthly rental income, they claim, and gain tax benefits from offsetting all the expenses of running your property against the income including mortgage interest payments which you can't do on ASTs, assured shorthold tenancies.
Although home owners can host their property themselves on sites, Ollie and John say there is considerable work involved. From promoting the home to the cleaning, doing the laundry to liaising with the guests, handling the payment, and managing the reviews afterwards, the Good Host will undertake it all for a fee. This starts at 18% of the net income after direct costs such as cleaning.
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John said: 'Buy to let property rentals are simply not creating the returns they used to. This year has brought with it some bitter changes to tax relief on mortgages and soon costs of references and credit checks will be the responsibility of the investor to pay, not the tenant. Every investor is feeling the squeeze.'
The short term rental growth in Norwich has exploded over the last three years with an average of 7% growth per quarter.
Rather than pay for a costly hotel, more people look for decent-priced accommodation whether they are parents visiting their children at university to tourists, families and those working away.
Within 13 days of listing Ollie's property on Airbnb, it was booked for 90 consecutive days. A typical AST would have generated on average £650a month with agency fees and possible storage costs on top. But over seven months on Airbnb, Ollie's house brought in a minimum of £1500 a month and at peak times as much as £2500.
Charles Clarke, chairman of the ELA, Eastern Landlords' Association and a landlord himself, welcomed the concept, saying: 'It's a good idea in principle, landlords would need to sort out their insurance as this will be different for an Airbnb.'
To find out more see www.thegoodhost.co.uk or contact them on 0800 980 4349.