Short-term letting and the sharing economy via services like Airbnb can offer Aussies a chance to make some money, but how long would it take to pay off a home loan?
Research conducted by peer-to-peer (P2P) motorhome rental platform SHAREaCAMPER has revealed how long it takes for a home in four of Australia’s capital cities to be paid off through ROIs by utilising share economy platforms.
With an average market price of $1,382,749.15 and a P2P rent price of $17,233.32 per month, Sydney has a yearly rate of return of 11.96 per cent, taking eight years to recoup the ROI, ranking second, beaten only by Frankfurt, Germany at seven years.
The next Australian city is Perth, ranked fourth. The average market price in Perth is $766,220.25, with a P2P rent price of $9,027.30 per month. It has a yearly rate of return of 11.31 per cent, taking nine years to recover the cost of the home.
Melbourne takes 15th place, with an average market price of $949,708.12, a P2P rent price of $8,125.66 and a yearly rate of return of 8.21 per cent, resulting in 12 years to pay off a home through the sharing economy.
The last-ranked Australian city is Brisbane at 24th spot, with an average market price of $732,380.47, a P2P rent price of $4,944.87, a yearly rate of return of 6.48 per cent, resulting in 15 years to pay off a home.
The 2017 Return on Investment Index report analysed 31 cities on various rental P2P platforms, including homes. Rankings were calculated by analysing the ratio of market to P2P rental prices for more than one thousand assets per city. The cities were then ranked by the total time needed to regain investments based on the ROI percentage.
SHAREaCAMPER CEO Florian Dahlmann said the sharing economy offers “great individual experiences as well as flexibility”.
“The biggest lesson of our research is that you don’t need to charge exorbitant rental rates to pay off your investment. We are huge fans of win-win situations like this and we hope this research encourages development in more hesitant markets,” Mr Dahlmann said.