Everyone likes to take a vacation to a fun and relaxing location away from home. Many people, especially families, enjoy renting a home instead of a hotel when they take their vacation. These rental homes provide them with more convenience, privacy, and comfort to allow them a more fulfilling vacation. The family has room to move and relax, cook meals, and go at their own pace.
Vacation rental properties open up a great opportunity for those wishing to invest in real estate. Purchasing a vacation home or other property can provide the means to begin a very lucrative business in vacation home rentals.
Our tips listed below can help anyone make this business successful…
Tips for Getting into the Vacation Home Rental Business
Location, Location, Location
Yes, it true! Location, location, location is paramount in your decision. Everyone has heard that the most important aspect of any real estate venture is location. This is especially true for a vacation home rental. The property should be in an area that is a popular vacation spot. Not only does the property need to be near the various attractions of the vacation spot, but it also needs to be in a location that provides a vacation of its own.
For example, purchasing a vacation home rental near a popular ski resort is a great option. However, the home should have a beautiful view or some other amenity that gives it an edge over other rentals, resorts or hotels in the area.
Beachfront property is always a good option for a vacation home rental. People enjoy travelling across the country to spend some time on the beach. If the property is right on the beach, it provides an added convenience for those on vacation. Unlike a beachfront hotel, a home allows vacationing people the extra convenience and privacy of enjoying the beach when they want to without other hotel guests taking up space.
It can be difficult and a bit intimidating making such a large purchase for a rental property. However, there are some tips that can help ensure a more successful business experience.
A little research on the average rental prices in the area for similar properties can provide an idea of how much money the rental can bring in. One tip that can help ensure that the property is profitable is to ensure that the cash flow will be at least $12,000 to $14,000 a year for every $100,000 invested into the property.
It is also a good idea to have this property financed. Finding the right mortgage option can ensure that the payments are small enough to be covered by the rental fees with some profit left over. One option is getting approved for a 30 year fixed jumbo loan. These loans provide the purchasing power needed to obtain the vacation property while providing a fixed rate to help budget the costs without surprises.
Advertising the Property
Advertising the vacation home rental property to prospective renters is vitally important to let people know the property is there. It is important that this advertising stresses the best aspects of the property.
Make certain that the location is highlighted as well as the local attractions. It is also a good idea to point out what makes this property better than the surrounding properties. However, it is a good idea not to lie about the property. Being truthful is very important since many people will post reviews and tell their friends. This can bring more business for the rental or deter them if the advertising wasn’t truthful.
Cleaning and Preparing the Property for Guests
Before any guests arrive, it’s important that the vacation rental property is thoroughly cleaned and prepared for the guest’s arrival. Property owners who live close to the vacation rental can handle this task on their own.
However, if it is in another city or state, it may be a good idea to investigate a property management company. These companies offer regular services to keep the property clean and well maintained throughout the vacation season. Some management companies can even maintain any repairs needed on the property.
It is important to screen guests before they rent the property. Property owners need to know who the person is that will be responsible for any damages, how to get in contact with them after they leave the property, and other pertinent information. It is also important to verify the identity and ensure that there are not any criminal issues that should be known. This can help protect the property and the property owner from various liability issues.
It may also be a good idea to investigate various security options to protect the home when it is vacant and to protect guests while they are staying. Installing some cameras or alarms can help a lot in these situations.
If the property has many units, a security guard may be a good option. If guests feel safe and secure during their stay, they will be more likely to return on their next vacation.
Many of the details of a rental property can be managed by a property management company. Many of these companies even offer advertising and billing options. This can make the vacation rental business an easy way to make money. These companies can handle all the details for a set fee and the remainder is sent directly to the property owner.
What do you look for when selecting a rental property for your vacation?
If you were to invest in a vacation rental property, what is the most important thing you would look for?