If you happen to be interested in purchasing a vacation rental property, there are many benefits and pitfalls for you to consider. Whether you purchase the property with the intent of managing it yourself or hiring an experienced person to manage it for you, there are some important questions that need to be answered before making such a large financial decision. Consider the following:
Where is the property located?
Before purchasing a vacation rental property, it is important to consider where you will be placing your investment. It is more beneficial to purchase a home near an attraction such as a ski resort or on beach than in the middle of nowhere. The latter may also result in far less interest from renters and lower rates that could make the investment less profitable.
What structural issues does the property have?
Oh, a termite infestation? That sounds delicious. Just kidding! Any serious structural issues with a rental property can be undesirable and costly to fix. Some of these expenses may include fixing sewer system problems, which homeowners will have to pay for even if they are not aware that it happened prior to
What amenities are included?
In addition to location, consider what amenities will be available for your renters. If you’re a frequent traveler, it is easy to forget that not everyone may prefer a home with a pool or hot tub while traveling halfway across the country. It’s also important to determine if all the amenities are in working order and if the items provided are of decent quality.
What type of property is it?
There are various types of rental properties, each with their own benefits. A single-family home may provide more privacy than a condo or apartment complex, but is also likely to be more expensive. Keep in mind that purchasing an apartment complex will require more extensive legal documents and increased liability.
Is the property in a good neighborhood?
If you could imagine a criminal breaking into this house, would he or she be able to find it? The last thing you want is your renters being worried about their safety while staying in your rental. Try to pick an area that has been proven to be safe for years and not just when there was no crime reported the previous week.
What amenities are available for renters?
As mentioned above, it is important to determine what your renters will be able to use while staying at the property and what must they bring on their own (i.e. towels, dishes). If you do not provide enough towels and decide an extra fee should be charged
What is included in the cost?
As you do your research, consider what utilities are included in the property’s rate. A swimming pool may sound like a bonus but if it requires an incredibly high electric bill, can you afford to pay for it? Additionally, traditional rental properties will often include appliances as well as a host to check in with regularity.
Is it a good investment?
In addition to an excellent location, awesome amenities and stellar property type, you should be confident that your vacation home is a worthwhile investment. It’s okay if the price tag for this property seems high compared to other homes on the market because you’re after a specific type of renter, but you should do your homework and be sure that the property will sell if necessary.
How can you ensure that it sells?
One of the most important things to consider is how to market your rental property and attract interested renters. If you plan on hiring a property manager for this task, consider what types of marketing they plan to use. For example, traditional forms of marketing such as Craigslist and newspaper ads may be less effective than strategically targeted online ads. In addition to marketing, you should have a plan in place for what will happen if your house does not sell. Will you keep renting it out or will you be downsizing and buying a smaller home?
How will you manage it?
It is important that you choose a property that allows for easy management at the very least, but preferably one that does not require an excessive amount of your time to maintain. You should consider everything from the property’s location to its amenities when making this decision, as well as how many renters it can accommodate comfortably.
Once you have decided on a property, it is essential that you consider how to ensure that your renters are comfortable and satisfied. This means hiring the right types of individuals to manage the property for renters as well as what amenities will be provided. A vacation home may not seem like an important part of everyday life, but it increases your resale value and is often the deciding factor when choosing where to live.
Cloud-based property management software
RentEvi is the future for vacation rental properties. This type of software can be accessed at any time, from anywhere in the world, allowing you to easily stay on top of your files without taking up space in your home.
Part of getting your vacation rental property ready for new renters is making sure that it remains clean and presentable throughout their stay. This means having a strong cleaning plan in place so that you can easily get your home back to yourself at the end of an extended rental period. When hiring a cleaning company, you should look for one that has several positive online reviews and that is known for its reliability and professionalism. Additionally, the best vacation home cleaners will have past experience of working with similar homes to yours.
Here’s an example list of items to bring:
-Toiletries (soap, shampoo, etc.)
-Towels and washcloths
What are your goals?
The last thing that you should consider is exactly what your goals are for purchasing a property like this. If you’re looking for an income-producing asset or simply a nice investment for the future, everything will be much different if you are looking to sell quickly. Additionally, if you plan on renting this property to your friends and family members, things are much different than trying to advertise it to strangers online. Make sure that when making your decision that you know what you’re working towards.
Check permits and inspections that are required for vacation rental properties.
When you have found the right property, be sure to complete a thorough inspection of the structure before buying it. This will help you determine if any major renovation projects are necessary and give an accurate estimate of how much your renovations will set you back. You should also consider hiring a property inspector or attorney with experience in this area to help you identify any potential problems.
As you can see, there are many things to consider when looking for a vacation rental property. This list is not all inclusive but covers several important ideas to keep in mind as you search for your dream home. You should also remember that you can always consider hiring a real estate agent to help, as they too make the task easier and less time consuming.
Be sure that any management or rental company is reputable and will provide the necessary support for your property. If you’re not managing the home yourself, hire a property manager who can handle all aspects of managing this property so that you don’t have to worry about it when you are away