1) They are not residential-titled
Serviced apartments are high-rise residential buildings constructed on commercial land that go by a variety of names.
Small Office Flexible Offices (SoFos), Small Office Versatile Offices (SoVos), and Versatile Office Suites all fall under this category (VoS). The land title makes a big difference – particularly in terms of cost, as we’ll discuss further down.
Serviced apartments aren’t often the first option for those looking for a spot to call home because they’re mostly geared toward visitors, corporate travellers, and long-term non-permanent stays.
2) Higher utility bills, higher tax rates, higher maintenance fees
Since serviced apartments are built on commercial property, their owners must pay commercial rates as well. As a result, if you’re the lucky owner of one, you can expect to pay more for practically anything.
- Utility fees: Electricity rates for industrial projects are usually 30% higher.
- Maintenance fees: The various hotel-like facilities such as housekeeping and bellboy services can result in higher maintenance fees depending on the particular serviced apartment.
- Quit rent is usually 2.5 times the cost of a home.
- Assessment fees: Serviced homes can be assessed at a rate of 5%, which is 1.5 percent more than stratified properties.
- Commercial advances in broadband internet and cable television
3) More amenities are provided
In terms of location, serviced apartments are usually found in some of the most desirable areas.
Whether in the centre of a vacation destination or right in the midst of a business district, serviced apartments depend heavily on amenities.
Serviced buildings are often seen as part of larger neighbourhoods, often with easy access to mass transportation, shopping centres, and supermarkets.
In comparison to hotels or condominiums, serviced apartments would appeal to corporate travellers, visitors, and expats who are also looking for permanent accommodation.
4) Seems like being the wiser choice
With such appealing selling points as a great venue, smooth networking, and a myriad of amenities, it’s no surprise that serviced apartments are famous investment properties.
Serviced units, in particular, are well-suited to short-term and long-term rentals.
Serviced apartments are normally fully furnished and have simple hotel-like amenities such as housekeeping. When you factor in their access to public transportation and other facilities, it’s easy to see how they’d make an excellent investment property.