Recent data shows around 1.95 million listed vacation rental properties in the United States. With more people choosing to keep their holidays domestic, the short-term rental market will continue to grow.
Having a foot in the short-term rental market can have many unique benefits. Still, it also comes with challenges that long-term landlords don't always want to deal with.
That's why it's essential to consider the various factors in the short-term rental business. If you want to rent a property out short term, factor these three considerations into your decision.
1. Demand Fluctuations
Short-term rentals often have brief vacancy periods between guests, but these vacant periods get longer in "off seasons." Part of your short-term property management strategy will be storing some cash reserve to sustain you in these times, especially if it's a vacation rental.
You can also decrease these vacancies' effects by listing your property with a professional short-term rental management agency. These services come with client bases and boost your property's trustworthiness beyond its star rating.
2. HOA Rules and Restrictive Conditions
Local governments and any existing homeowners associations will have rules governing how residential properties should operate. Firstly, make sure you know which general rules are being imposed on the property.
To get approval, the upgrades you envision to make the place more attractive must fit within the building guidelines. These rules may be as particular as regulating the type of paints you're allowed to use and which materials you must use for window frames.
Many areas in the country are zoned for owner-occupants only, so you're not allowed to rent them out. However, some places have unique property tax perks and tax breaks for short-term rentals.
3. The Need for Extra Protection
Short-term rentals' risk factors are all higher than standard rental units. This is because there's more traffic coming through one of these places. More people doesn't only mean more use, but also more kinds of use.
Short-term rentals need sturdier furniture. Each new tenant treating the fixtures differently puts a lot more stress on those fixtures.
Secondly, you need short-term rental insurance. These specialized insurance policies cover properties with high guest turnover. They even protect against legal costs that could come from injuries.
Lastly, getting a short-term property management group to screen guests protects against bad tenants. The screening process must be legal to avoid unfair discrimination. Property managers know how to do this within the right legal boundaries.
Let Your Short-Term Rental Succeed
A short-term rental can be an amazing investment, but there are unique factors to consider before investing. Firstly, the place may be vacant more often unless you have good cash flow and use strategic marketing.
Secondly, you'll have more rules to follow. The law and HOA regulations limit what you can do with one of these properties. Lastly, you have to factor in the extra costs for protection.
Are you looking for a trusted property manager to guide you through these extra steps? Contact us today and get the best property management service.
