all seen how much money-savvy investors can make by using Airbnb and other
services to rent out their properties. If you’d like to do the same, there are
a few things you need to know.
Here’s how to finance and manage a vacation rental:
Browse online listings
Generally, online searches are the best places to start when you’re looking for vacation rental properties to purchase. Look into tourist destinations that you know and like, and then get a greater feel for each destination by looking at local attractions, maps, hotels, and current vacation rentals in the area. This will make it easier for you to see how much you can expect to make and whether the area is the best option for you.
Work with a real estate agent
Once you’ve done your homework, the next best idea is to work with a local real estate agent. They should know the local area like the back of their hand and should help you set up appointments to view potential properties and learn more about the neighborhoods you’re interested in. A good real estate agent will be able to educate you further about the area, including where most vacationers are staying, and how much similar properties are renting for.
Do your numbers
Obviously, you want to find a vacation rental property that you and your family can enjoy occasionally, but also one that makes good financial sense. Once you’ve identified a potential property, you’ll need to do a cost-benefit analysis. This will ensure you can afford to pay for the property even if it’s vacant for longer than you would expect. Don’t forget about taxes, operational expenses, property insurance, HOA fees, utilities, management fees, financing costs, and unexpected expenses for repairs.
Once you’ve financed and purchased your vacation rental, it’s time to think about how you’ll manage it. The best way to do this is by using vacation rental management software. This software is specifically designed to help you manage multiple rental channels such as HomeAway, VRBO, Airbnb, and more. Managing your property can be much more time-consuming than you’d initially expect, which is why using software makes sense- automating part of the task will free up your time for other management activities and ensure that you’re never double-booking your property.
Are you thinking about purchasing a vacation rental? Leave a comment below with your thoughts.