The benefits of colocation for investors

Shunned a few years ago by owners, shared accommodation is now more and more popular. But what are the advantages of investing in colocation for investors? Zero vacancy, reduced rental management, higher rents, better guarantees... There are many of them and we invite you to discover them in more detail. You can also find some useful tips at the end of the article.

Investors: six advantages of colocation

Few or no vacancies, reduced rental management, varied profiles, higher rents... Here are six advantages of shared accommodation for investors.

First advantage: less or no vacancy at all

When a tenant leaves a property, it often happens that it remains empty for a certain period of time (on average two months). This is a problem for homeowners who lose money in this way. With shared accommodation, the vacancy is reduced, or even zero in many cases. In addition, by renting in a shared apartment, it allows tenants to share the rent and thus save money, which attracts more people.

Second advantage: reduced rental management

Often, when an owner rents his shared property, he does not have to manage the visits and recruitment of new tenants because the occupants of the property do it themselves. Why? First of all, because they generally have to make up the missing rent while waiting for the former roommate to be replaced. Then, because they will share the daily life of the future tenant and it is therefore normal for their opinion to be taken into account. Moreover, in terms of shared accommodation, for a new tenant to be accepted, all parties must agree. This reduced rental management saves the owner a significant amount of time.

Third advantage: better guarantees

By choosing to rent in a shared apartment, you benefit from better guarantees. With a joint lease, for example, if one of the occupants does not pay a month's rent, the others undertake to compensate, which is not the case with an individual lease. In addition, with the Alur law, a roommate who leaves the home is in solidarity for a maximum of six months. Not to mention that in the event of damage, the owner can ask for the property to be restored without trying to find out who is responsible for the damage. These various guarantees are a significant advantage.

Fourth advantage: higher rents

For the same area, shared accommodation allows you to offer a higher rent than with a traditional rental. The rental profitability of a shared apartment is therefore more interesting: one to two points more than a traditional rental. But be careful, this advantage is no longer valid in the tense areas defined by the Alur law. In fact, this requires that the total rent paid by the roommates should not be higher than that which a single tenant would pay.

Fifth advantage: shared accommodation is better supervised than before

Always with the Alur law, shared accommodation is undergoing some changes. Now, it benefits from a better defined legal framework (population standards, rules related to volume division, etc.). A good point for landlords as well as for tenants.

Sixth advantage: shared accommodation attracts all tenant profiles

Previously, roommates seemed to be for students only. Now, even young workers and other managers are looking to live “in a roommate”. Why? Because they are looking for properties with comfortable dimensions and attractive rents. Today, 54% of roommates are working people compared to 45% of students.

A few tips to remember when investing in a shared apartment

Wanting to invest in a shared apartment is one thing, but being able to do so is another. Check that your home is suitable and that it will allow each roommate to have their own space. This does not mean a bathroom, a bedroom, a toilet and a kitchen each, but at least one room per person. How do you find roommates? Through real estate agencies or even specialized websites. Be careful to set the rent price carefully, which must be as fair as possible. Find out about those practised in the same sector and for similar properties. Real estate agencies can guide you if necessary.

To simplify the management of the shared apartment and especially the payment of rent, the ideal is to designate a manager among the roommates. He will be responsible for paying the total rent by check, for example, and will also be in a way the spokesperson for the tenants. You will thus only have to collect one payment each month and only one and only one interlocutor.The lease must respect various rules and include various terms (duration, renewal/termination conditions, etc.) as well as the obligations of the parties. A solidarity clause is also highly recommended. Do not forget also the full resolution clause, which allows you to end the lease if the roommates do not comply with one or more obligations. Clauses concerning the non-transformation of the property without the agreement of the lessor or even damage are also to be expected. Remember to carry out an incoming inventory to have proof of the condition of the property at the beginning of the shared apartment. Also check that your roommates are insured (multi-risk home) .Finally, return the security deposit — within two months — only if all the roommates have left the property.

Do you want to invest in Paris or in the Paris region and rent a shared apartment? You do not have time to visit properties and/or are you afraid of traps and scams? Call in a real estate hunter. The entire Home Select team is at your disposal to support you throughout your purchase project and even after. See you soon!