If you’re thinking about getting into the Vacation Rental Industry, now is the time to do it as it is becoming increasingly popular. Vacation Rental Revenue for the U.S. in 2019 has already surpassed 1.75 Billion Dollars. But there are costs to consider when entering this industry, whether you’re using a home you already own or are looking to purchase a new one. At the end of the day, we know you’re looking to make a return on your investment, which is why we want you to provide you with the 3 most common mistakes people make when entering the vacation rental industry;
1. Not Considering Vacation Rental Investment Costs
Even though owning a second home isn’t just for the rich and famous anymore, thanks to rental income, you still must consider additional costs. If you’re in the market for a home, condo, or even apartment, you must consider the price for purchasing, the down payment needed, and if you’ll need to do any additional updates to the home before making it rental ready. Whether you already have a vacation rental home or are purchasing a new one, you also need to consider the cost of insurance, taxes, furniture, and repair and maintenance costs.
If you’re not an expert in this industry, we encourage you to ask for help. Things get overlooked all the time and there are people who can be a helping hand and walk you through the entire process of buying a vacation rental property.
2. Knowing Where to Buy A Vacation Rental
One of the main things to consider when putting your property on the vacation rental market is where the property is located. You need to have a good understanding of the properties that are situated around your potential listing and understand the value of their homes compared to yours. You will also need to consider what your potential guests want in their vacation rental and what your competition has to offer that you don’t.
Are you looking for a beach rental or maybe something a little more off the beaten path? Does your neighbor offer a swimming pool? You may want to consider purchasing a home in a community that offers these additional amenities or consider building them in order to provide the very best to your guests.
3. Thinking Vacation Rentals Can’t Be Managed from Afar
Now that we’re in the digital age, it is easier than ever to manage vacation rentals in different locations. Allowing yourself to purchase and rent properties that are in higher demand for tourism, will give you more potential rental income. There are many solutions to consider when looking to modernize guest stays, like providing automatic door locks, WIFI enabled thermostats and Smart TV’s which can all be handled from afar. If handling the rental rates, hiring a cleaning company, marketing your property, or even handling the upkeep and maintenance for your vacation rental doesn’t sound like your cup of tea, you can hire a property management company that will be able to handle all of the above for you.
If you’re serious about investing in a vacation rental property, the best advice we can give you is to be informed about the demand in the area, what the competition is doing, and don’t be afraid to ask for help. We hope this article helps you make an informed decision with your investment!