Dallas Apartments

Why Do Apartments Attract More and More Visitors?

It’s no secret that Dallas has an incredibly popular rental market, especially for apartments and condos. This is both good and bad news for property owners and real estate investors. On the one hand, purchasing turnkey rental properties has never been more lucrative than it is right now. With corporate businesses booming all over Dallas, bringing in more new talent every day, the demand for rental apartments is astronomical, which means you’re almost guaranteed to make a profit on any turnkey rental apartment you purchase.

At the same time, apartments can involve a great deal of maintenance and can undergo a lot of wear and tear from one tenant to the next. This is made even worse when apartments seem to attract more and more visitors. With people coming and going all the time, floors get more traffic and appliances and fixtures get more use and abuse. So why are there so many visitors in these apartments, and can you control the flow of people in and out of your property?

Weekend Sublets Can Be a Problem

According to the New York Post, one landlord is suing his tenant for subletting her apartment on AirBnB for $190 per night. While subletting might seem harmless, when you have a turnkey property, it can turn into a nightmare. Not only does it increase foot traffic through the property, but it can also result in major property damage.

Time Magazine reported on a house that was completely trashed after a single weekend. That’s bad enough if you are renting your own home out for a period of a few days at a time, but what do you do if your tenants sublet their apartment and come back to find serious damage and toxic waste? Fortunately, your rental agreement should have a clause regarding sublets, and you should be protected against this kind of problem. If you have any questions about the risk of tenants subletting your property to unvetted guests, talk with your property management company to ensure that you are covered and that your risk is minimized.

More Visitors Can Mean New Tenants and Investment Opportunities

Now, obviously not all AirBnB and subletting guests are the kinds of people who will ruin a property in just a few days. In fact, many of these people are actually visiting Dallas because they may want to move here for work or school. If we look at the root of the issue, apartments are attracting more and more visitors because Dallas has a lot of great job opportunities, great quality of life, and the cost of living is not astronomical, either.

So what does that mean for you as a real estate investor? How can you improve your investment portfolio while decreasing your risks of property damage and liability? If you are concerned about a situation like the one that Time reported, you may want to opt to invest in a real estate investment trust (REIT) instead of purchasing a single unit in a commercial residential building.

This solution comes with a number of potential benefits. If you purchase equity in a building or complex, you will not be dependent on a single tenant to continue to see monthly or quarterly income. Instead, you will own a share of the property’s equity, which means you will get a percentage of the profits on the property on a regular basis, usually paid quarterly.

If you invest in an REIT, you will not be responsible for finding tenants for your property, and all property management responsibilities will be taken care of for you. This kind of property is much less likely to have problems with subletting, and if the complex has 100 units, a few vacant units will not hurt your profits in any significant way. Thus, if something does happen due to subletting or abusive visitors putting wear and tear on the unit, you will not have to worry about losing a lot of capital.

All in all, increased numbers of visitors to Dallas apartments should be a good thing for real estate investors because those numbers represent a continued high demand for rental properties in the area.