There is a lot of debate out there whether having a vacation rental property is a good idea. While it is not the right choice for everyone, it can be a great option for many people looking to make an investment. In today’s market, renting short term vacation properties is a particularly booming business that makes the reality of owning a property profitable with the right know how.
Here are 9 reasons a vacation rental property might be right for you:
- A vacation spot for your family with rental opportunities the rest of the year. Did you find a perfect destination that you would love to visit regularly? Having a vacation home is a great way to be able to visit a favorite location periodically. In the meantime, short term renting is a great way to make some money and have your house consistently maintained.
- Cover your mortgage, taxes and other costs of a home. Owning a home can come with a lot of undercover costs, keep them well managed in addition to a profit when you choose a rental property that has a high return on investment (ROI). Plus, that money going into your home is helping you build your own equity.
- Financing a home that you will use for dual purpose. Buying a home with the intention of short term renting gives you different options for financing that are not available with long term renting. Check with your realtor for more information on the benefits.
- Possibilities for tax deductions. As long as you occupy your second home often enough each year, you can get similar tax benefits and write-offs as you do with your first home. Talk to a trusted accountant or tax specialist to learn how to maximize these possible perks.
- Short term rentals provide higher rental income. The ROI tends to be higher for a short term rental over a long term rentals. With vacation homes, since can charge a premium for location and peak seasons.
- A short term rental can be easy to manage. You can certainly take on managing your property if you have the time, patience, and skills. However, there are great options for management companies that can do everything for you. Companies like Skye Management minimize your involvement and take excellent care of your property, while still making you a pretty penny each month!
- Short term rentals are a booming market. Statistics show that more people are going to Airbnb over hotels for their vacation needs (up to 61%). That is a lot of people looking for accommodation.
- It helps you vary your investments. Diversification of your investments gives you a strong portfolio for managing the ups and downs of the economy. A rental property is a nice addition to building you (or your family’s) nest egg.
- Find a love for providing high quality vacation experiences as a host! Sharing your home and providing excellent customer service is very fulfilling. If you enjoy the process, the joy and benefits you will derive from your property will exponentially increase.
Buying a vacation home ultimately comes down to your bottom line and comfort level. It can be an exciting and rewarding process with the help of a realtor, tax specialist and management team. If you decide a short term rental is right for you, the sky is the limit.