Types of Real-Estate Investment: Golf Properties
Article: how to generate income with investment real estate on a golf resort.
A golf course development may include hotels and holiday homes and many resort facilities such as spas, stores and restaurants. It’s often possible to purchase a house or apartment in this type of resort, and they often make good investments.
Source: Pestana Golf
Golf properties are on the rise as the sport takes off around the world. In many ways it seems obvious – golfers are willing to travel to get to a great course in great conditions, but once teeing off, they want to focus on the game. What better way to do that than to create an environment where everything they need is on hand?
As many golfers holiday with non-golfers, such as spouses or children, a well-appointed resort will offer many facilities, such as swimming pools, shops and children’s entertainment, making the golf resort a holiday resort with potential for excellent returns as an investment.
Advantages of investing in a golf property
- May be the ideal second home or holiday home for a keen golfer, and mortgage payments are likely to be lower than paying rent or hotel fees
- Rental returns may be higher than on standard holiday homes
- May be easier to manage because property management services and letting services are often included or offered (for a fee)
Disadvantages of investing in a golf property
- May be high annual fees covering property management, green fees and other services
- May be restrictions as to who the property can be let or sold to, which tradespeople you use, what you do to the property, and so on
- Market is limited (to golfers or other investors) both in terms of rental and eventually selling the property
What to look for when investing in a golf property
The considerations for buying a golf property are similar to those for buying a holiday home. However, you should also ask yourself:
- Is the resort new or well established? This should be part of your risk vs return calculation
- How much are you really going to use the property or is it purely an investment to rent out?
- If you intend to use the investment for your own golf enjoyment, is the course suitable for your style of play? Will it still be interesting in 2 or 5 or 10 years time?
- Is the resort suitable for your family? Will that still be the case in a few years, for example, as children grow older?
- How do costs compare to independent properties near the golf course?
- How do the facilities compare to other golf courses or resorts?
- Is the season limited or year-round? How will this affect your use of the property or rental income?
- Are you familiar with the course and the area? This is particularly important when buying property abroad, which presents its own challenges and legal pitfalls