In the context of rapid urbanization, the demand for rental apartments in big cities such as Hanoi, Ho Chi Minh City, Da Nang or Can Tho is increasing rapidly. Not only is it a temporary place to live for workers, students or tourists, rental apartments are also an attractive investment channel.
This article will introduce in detail the popular rental apartment models, along with an analysis of the advantages and disadvantages, development trends and important notes when investing or looking to rent an apartment in the city.
Short-term rental
Short-term rental apartments are usually designed for tourists and business travelers who stay for a few days to a few weeks. These short-term rental apartments are usually located near the city center and are fully furnished and equipped with hotel-like amenities.
cAdvantages of short-term apartment rentals
- Daily rental prices are high, good profits if occupancy rate is high.
- Short-term daily rental apartments are suitable for tourists who love private space.
- Short-term rental apartments can be flexible in use (can combine living and renting).
Disadvantages of short-term apartment rentals
- Maintenance and cleaning costs for short-term rental apartments are often quite high due to the frequent rental nature.
- Short-term rental apartments often depend heavily on tourist seasons, epidemics, and travel trends.
- Rental apartments must comply with local regulations regarding the type of accommodation business.
According to a report from AirDNA, the short-term apartment rental market is recovering strongly after the pandemic, especially in major tourist cities such as Da Nang and Nha Trang.
The model of rental apartments is developing strongly again after the pandemic, especially in big cities.
Long-term rental
This is a model of apartments for rent by month or year, serving employees, young families or foreigners residing long-term in Vietnam.
Advantages of long-term apartment rental
- This type of long-term rental apartment helps investors stabilize monthly income, while helping customers avoid fluctuations in costs because they have signed a long-term rental contract.
- Long-term rental apartments often require less management and operation than short-term rentals.
- Long term rental apartments are easy to manage costs and scheduled maintenance.
Disadvantages of long-term apartment rentals
- The rent for long term rental apartments is not as high as that for short term rental apartments.
- Long-term rental apartments often face the risk of early contract liquidation, and tenants do not take care of the property.
When investing in the rental apartment model, you should choose areas with high population density, near schools, hospitals, industrial parks such as urban areas in Binh Thanh district, Ho Chi Minh City or Cau Giay, Dong Da, Thanh Xuan, Tay Ho Hanoi.
>> Apartments for rent in Tay Ho district are currently loved by many business travelers and tourists because of their ideal living space and affordable rental prices.
Serviced Apartment
Serviced apartments are apartments for rent that are fully furnished, have housekeeping, maintenance, and reception services like a hotel, and are aimed at foreign guests, businessmen, and experts.
Advantages of serviced apartments
- Rents for serviced apartments are often high.
- Serviced apartments usually have a stable customer base, willing to pay high fees for good service.
- Most foreign companies will look to rent serviced apartments to provide for their experts to work.
Serviced apartment rental models require more care, meticulous service, and careful investment than other rental apartment models.
Disadvantages of serviced apartments
- The operations of serviced apartments can be more complicated than other rental apartment models.
- Because the customer base is made up of experts and large businesses, when running a serviced apartment rental business, a professional team is needed to manage and take care of customers.
- Serviced apartments will often require a high initial investment.
High-end serviced apartments in District 1, Thao Dien (HCMC) or Tay Ho, Ba Dinh (Hanoi) are always sold out. This is the most profitable segment if invested properly.
Micro-apartment
This type of rental apartment has a small area (20-35m2), low price, aimed at students, singles, and middle-income earners.
What are the advantages of mini apartments for rent?
- Mini apartments for rent will be easy to find tenants, high occupancy rate.
- The initial investment cost in mini rental apartments is usually not too large.
- Mini apartments for rent are invested moderately, fully equipped and will suit the need for cheap housing in big cities.
What are the disadvantages of mini apartments for rent?
- What are the disadvantages of mini apartments for rent?
- Areas with many mini apartments for rent will easily have problems with hygiene and security if not well controlled.
>> In addition to mini apartments for rent, you can choose studio apartments for rent with larger areas, however the price may be a bit higher.
Officetel apartment for rent – Office combined with residence
This is a type of apartment that combines office and residence, usually with an area of 30-50m2. Very suitable for startups, freelancers, small businesses that need private working space.
Learn about the advantages of officetel apartments for rent
- Officetel apartments for rent are always flexibly exploited: both as offices and as residences.
- Officetel apartments for rent must have legal documents that usually allow business registration.
- Officetel apartments for rent have more competitive rental prices than traditional offices.
What are the disadvantages of officetel apartments for rent?
- Not all apartment rental projects are licensed as officetels.
- Các căn hộ cho thuê dạng officetel thường hạn chế thời gian sở hữu (đa phần 50 năm).
- Officetel apartments for rent often have limited ownership periods (mostly 50 years).
Combining multiple rental apartment models – The optimal profit solution
Some large investors are now choosing to combine the apartment rental model to optimize profits and maintain a stable source of income.
For example: divide a 3-bedroom apartment into 3 mini apartments for private rent or combine a serviced apartment and a long-term rental apartment.
Apartment rental models are always optimized by investors but still meticulous to bring the best living space to customers.
Real life example
In Ho Chi Minh City, the model of combining mini apartments for rent with utility services such as laundry, cleaning, and private parking is becoming increasingly popular. This helps increase the value of rental apartments by 20-30% compared to simple apartments.
In Hanoi, especially in areas such as Cau Giay, My Dinh, Dong Da, the model of mini apartments for rent with elevators, 24/7 security cameras, fingerprint locks and regular cleaning services is also flourishing. Landlords often design 5-10 rooms/1 building, with basic furniture such as beds, air conditioners, refrigerators. The price of these types of apartments for rent usually ranges from 4-7 million/month or more depending on the geographical location and services provided, but the occupancy rate is always above 90%, especially during the admission season or peak student enrollment season.
Advice for rental apartment investors
- Carefully analyze the location where you want to invest in rental apartments: You should choose to invest in rental apartments near the center, universities, and industrial parks to help increase rental rates.
- Identifying the right target customers: Identifying target customers, their interests and needs will help investors decorate and set up rental apartments appropriately. Increase rental rates more.
- Attention to interior and amenities – the deciding factor for long-term tenants: Recently, investors often focus on interior design for apartments for rent because a complete, clean, and comfortable living space will be the deciding factor for whether or not a tenant will rent long-term.
- Clear and transparent contract: For rental apartments, especially long-term rental apartments, the contract needs to clearly state each item and each cost to avoid legal risks.
- Take advantage of online channels for marketing: With the current trend of social media channels growing, posting information about apartments for rent on platforms such as Batdongsan.com.vn, Chotot, Facebook Marketplace will help attract many customers interested in using the service.
The demand for rental apartments in big cities is very high, especially in the period of strong urbanization and population rejuvenation. Each rental apartment model has its own advantages and disadvantages, suitable for each customer group and investment level.
Understanding each type of apartment for rent, combined with the ability to operate and analyze the market, will be the key to optimizing profits and minimizing risks during your investment or rental decision process.
