There has been a growing interest in Cyprus apartment rentals where in recent years rents have increased by at least 50%, especially for units that are geared towards foreign tenants. Recent experience has shown that “high net worth” tenants pay particular attention to units that offer concierge services, either directly or through the landlord.
This is a new type of service, something between hotel accommodation and fully-furnished properties such as Airbnb with some of the new facilities now offered including groceries, laundry service, etc, which single or young foreign couples find of particular interest.
A luxury apartment block in Nicosia offers ‘administration’ option that include:
- Cleaning (once a week or more) including laundry, changing of linen, dish washing, window cleaning, etc.
- Online grocery shopping, through certain supermarkets with home delivery, whereas fresh vegetables (eg. Alion) can be delivered at home within the day – fresh and top quality.
- A list of take away and food delivery platforms such as Foody with more than 100 restaurants/take away businesses to choose from.
- A service for ironing, washing to be collected and delivered at home.
- Baby-sitting is another option.
- Party organisers or other organised caterers/hotels, is most convenient with the provision of waiters and after-event cleaning.
- A taxi service including delivery and pick-up from children’s schools.
- Gym services including a personal trainer (at home or in the gym).
Of course, all the above facilities provided are on a need-to-use basis and they are charged over and above the normal common expenses and the rent.
A client with an income of €300,000 p.a. expressed his satisfaction for this type of service by letting us know that “it is like living in a hotel, but it offers better home facilities and at lower cost”.
International auditors, banks and other services companies with foreign clients is one source, as are specialised websites. My neighbour in Protaras told me that “we arrived at our home and we then realised that we did not have vegetables, bread, basic groceries, etc and with a phone call we had everything we wanted delivered at home the next day”.
This may be considered an added luxury to locals, but for foreign tenants it is more of a necessity having to find out where everything is.
In the event of the landlord managing such a service, the “management fee” for such a service starts from around €50 a month. The again, the landlord must not see this as an opportunity for a quick profit, but more of a facility in order to keep the tenant happy both in terms of rental payment and the duration of the stay.
Tenants of such a caliber will appreciate some sort of a “personal” care from the landlord. By sending your tenant a selection of dairy goods and halloumi, every now and then, and other local produce, could do wonders. You need to build up a personal relationship which helps and show that the landlord cares and is not pushy.
The target should be to have an annual return of around 3% (rental income Vs. value of the unit) notwithstanding that some greedy landlords are seeking to profit with over 6%, which is not attainable over the long term.
The rental market is affected (as well as other type of investments) by the overall economic situation of the country, which is now a concern if Cyprus will remain attractive after the collapse of the double taxation agreement with Russia, as well as the current state of the tourist industry.
Those who aim too high with initial rental income must be prepared to have the cash to sustain the increased void periods and maintenance that new tenants will require, as high rents causes a large turnover of tenants. Nothing is certain under the prevailing circumstances, so by providing added services to your tenant is one way to keep them happy, retain your rental income and secure their mid-term stay.
Such added service are already provided by some of the Limassol towers and others whose rental attraction is in trouble – evident from vacant apartment buildings having no lights during the evening.
The easy rent income period does not seem to have a guarantees regarding foreign lets and this is one way to cover oneself for any unexpected changes.
