How to Make Money by Investing in a Vacation Rental Property
Vacation rental properties have become a hot commodity in recent years for individuals who want to invest in something that will continue to pay off. With the right location and some attention to detail, you can create a rental that attracts a wide variety of guests, and you can decide whether it’s booked throughout the year or seasonally, which might offer you a tax break, among other perks.
Some things you’ll want to look at include the location -- what the city has to offer, what the weather is like year-round, how safe the area is, and what the competition will be with nearby rentals, etc. -- as well as the laws regarding the necessary permits to make renovations or updates to the home. Keeping your guests safe, comfortable, and happy will ensure that your rental is always booked and that you will continue to earn an income on your vacation property.
A few of the most important details to consider include:
Location and proximity to attractions
While a cabin in the woods is great for relaxing, a vacation rental in a prime location may earn you a greater number of bookings throughout the year. San Diego is a great place to invest in a rental property because of all it has to offer. According to Turnkey, this popular California vacation city has 70 miles of coastline and maintains an average temperature of about 70 degrees year-round, making it the perfect relaxation destination. Plus, there are ample attractions that will be draws for guests: La Jolla offers beautiful scenery and oceanic wildlife, while the Penn Station area is home to the San Diego Zoo and the San Diego Natural History Museum, just to name a few. You really can’t go wrong with an area that has so much to offer vacationers.
Keep it safe
When someone is away from home, they often feel more vulnerable, especially when staying in a rental house instead of at a hotel. One of the keys to ensuring your guests feel safe is making the home secure, which can be achieved in a number of ways. From monitored systems to surveillance cameras that keep a watchful eye on the perimeter of the home to a keyless entry/alarm system combination, there are security features for any budget or need. Do some research into the area your vacation property is in to find out more about its history with crime and other issues; this will help you decide how best to secure the home. You should also look into finding the right insurance and protecting the house with smoke and carbon monoxide alarms. Not only will this help to attract renters, it will give you peace of mind and could prevent costly repairs.
Maintaining a rental property can take a lot of time and money, and if your year-round home isn’t in the same city, it might be a hardship to travel back and forth to make repairs and perform general upkeep. Without regular maintenance, however, you’ll likely see your bookings diminish steadily over the course of a year. The exterior and interior of the home need to be kept clean and in great shape if you want it to continue to be profitable, so add the cost of hiring a property manager to your budget if you can’t get there between guests.
Fill it with durable items
When furniture and necessities are used multiple times by many people over the course of a year, they quickly break down. You may be tempted to buy expensive pieces that will attract a certain kind of renter, but it’s important to remember that you can fill the home with all the comforts a vacationer will need and make it look beautiful while staying on a budget. Replacing worn-out furniture will get costly very quickly, so go for sturdy, stylish, current pieces that add to the look of the home without pulling from your wallet.
Investing in a rental property can be a lengthy process when done right, and you want to perform plenty of research before making any decisions. Try to stay patient when looking for the perfect location, and get to know the area first if possible by staying there yourself. With some thoughtful moves, you can start making money with your investment right away.