With the development of tourism in recent years, resort real estate has emerged as a new investment trend for individual investors with little capital. However, not many people understand what resort real estate is. And is this an easy-to-profit investment channel? If you want to try your hand at resort real estate, don't miss this article.
What is resort real estate?
Resort real estate is a general term for all types of accommodation serving vacation rentals for tourists such as: resort villas, hotel apartments, mini hotels, condotels, townhouses, bungalows. ….
All these types of accommodation are built in tourist and resort areas. In fact, resort real estate is a form of business that is not owned by the investor. Investors build resorts and resell them to individuals or organizations.
Otherwise, they will do real estate business themselves or sell to individuals, business organizations and share the profits. This type of resale and profit sharing is quite popular in Vietnam. Simply put, resort real estate is a form of accommodation for tourists both for business and for vacation to make a profit in the long term.
Types of resort real estate
Beach resort villas: These are resort apartments built on coastal city islands, beautiful, famous beaches and coastal resort villas.
Hotel apartment: Condotel is an abbreviation of Condo & Hotel, meaning apartment hotel or hotel apartment.
Resort urban area: A tourist resort urban area has the structure of an urban area but is operated for the purpose of serving tourism and resorts.
Extended Old Quarter: This is a part of the old quarter designed in the style of the old quarter combined harmoniously with modern infrastructure. It can be said that these resort real estate project products will bring visitors completely new experiences.
Mountain view resort villas: In Vietnam today, there are many resort real estate projects built on beautiful terrain in eco-tourism and high mountain areas such as Sapa, Tam Dao, Ha Giang, Hoa Binh.
Where does the revenue of resort real estate come from?
Resort real estate's main source of revenue comes from leasing resort villas and hotel apartments in tourist areas, from which there is a cash flow to pay customers. It is known that in Vietnam, investors are often committed to a profit of 8-12%/year. This is an attractive profit commitment because the bank interest rate is only 6-7%/year, not to mention that customers also get 10-15 nights of resort stay.
In addition, there are project development units that share business profits 85/15 - 80/20 - 75/25 depending on the project selling price and the hotness of the resort location. However, to ensure the profit as committed, the management and operation unit must be professional and experienced to exploit the number of customers at the resort and along with that is the reputation and potential of the investor.
What should investors pay attention to?
Although it has the potential to generate attractive profits, resort real estate is a rather unique type of investment, and not every project that investors invest in can be successful. Investors who want to target the resort real estate market need to pay attention to many other more important factors and should not focus on profit commitments.
Investors need to ask themselves a series of questions such as who is the project investor, is it reputable in the market, does it have experience in developing successful projects in the market, who is the project management and operation unit, and is the project attractive to tourists?
Investors need to choose products from large investor brands that have experience in developing and operating resort products so that the project can generate stable, long-term profits.
Should I invest in resort real estate?
Resort real estate has the advantage of having full facilities from 3 to 5 stars such as restaurants, gyms, swimming pools, room service, drivers, etc. Imagine you own a resort apartment that has a cozy space like your own home, and you can enjoy services that sometimes cost you a lot of money if you were just a regular guest.
The economy is growing, the quality of life is improving, so the demand for vacations has also increased in recent years. Specifically, according to the latest report in the first 7 months of 2019 of the Vietnam National Administration of Tourism, the number of international tourists to Vietnam reached about 9,796,785 arrivals, an increase of 7.91% over the same period in 2018, mainly visitors from Asia.
In general, resort real estate is a potential segment, bringing many real values. Hopefully, with the information that AHS has just provided, it has helped you understand what resort real estate is.
