Instead of Selling Your Home Why Not Turn It into A Vacation Rental?
So, you are looking to sell your home and move on. Maybe you want to downsize or upsize, but have you ever checked how popular your location is for tourism or business visitors? The reason I as this question is because if the area you live in is a popular short stay destination, then you really do not need to sell.
Own Two Properties and Have Your Mortgage Paid for You
With the current rise of vacation rental websites, there is an increasing number of homeowners that have sought out advice from a financial advisor and been able to reportage their home instead of selling it. Their main objective is not to sell their property, but to look into the possibility of increasing the number of properties they own as well as create a vacation rental business.
With the reportage deal, they are able to still buy their new home and pay off their mortgage often at a lower rate than originally budgeted. Although in some cases the increase in the mortgage payment is low enough to justify not selling their old home.
By using the income received via the short-term rental of their old home to those business visitors and vacationers looking for a short-term holiday home via vacation rental websites, owning two properties is possible.
Saving on Capital Gains Taxes and Other Costs Involved with Selling Your Home
This is going to be quite a short section, but we felt it deserved its own catchy subtitle just to catch your eye. After all, that’s what subtitles are for 😊.
If you sell your home, then the margins your home increased on value from the time that you purchased your house will be taxed. On top of this, you need an estate agent, surveyors, and all manner of other costs are involved with selling your home.
On the other hand, you don’t have to sell. Just do your research, find out if vacation rentals are popular in your area, and give it a try. You don’t even need to buy a new house to test the business idea out. You could rent your own vacation rental and place your home on a vacation rental website like Airbnb.com and test to see how popular your place is.
Of course, when you begin, you will not have any reviews, so make sure you mark the price down compared to other properties of the same quality in order to get bookings. Ensure you also tell people that the reason the piece is low is simply that you are looking for guests that will provide good feedback.
Now there are plenty of bargain hunters on these vacation rental websites looking for properties exactly like this because they know they can get a cheap deal from newly listed properties that need the feedback to succeed on the vacation rental website.
Do Your Research Before You Dive In Head First?
Absolutely yes. In the previous section, we probably jumped the gun a bit with the last topic covering testing your property on a vacation rental website. Take a look at the websites that offer vacation rentals – there are plenty to choose from. HomeAway, FlipKey, Booking.com, Expedia, Kigo, and so many more. Just check out this blog that gives you the 27 best vacation rental websites.
You can then look to see if other people in your area are renting their property out on short term holiday leases. Check their occupancy rates by looking at dates you book, have a look at the peak and off-peak season booking times, and see how the super hosts in your area are listing their properties because these are the people that really know what they are doing – or they would not become super hosts.
Alternatively, you could save yourself all of this hassle and just hire a property management company to deal with all of this on your behalf. They will take a fee, but you can always arrange a meeting and get an idea for the figures they offer. After all, they want your property and even more so if you want to rent it out on vacation rental websites because the profit margins are far higher than yearly lease contracts, which are the norm.
That leads us to the next section.
Earn Up to Five Times More Than You Would Renting Your Property
A yearly rental has a flat rate and is unaffected by peak or off-peak seasons. Also, people expect to pay a lower rate for monthly rentals because of the long term commitment. However, if you are someone visiting another location for a short amount of time, then you expect to pay hotel prices.
This is why vacation rentals have become so popular because now homeowners are able to charge hotel daily rates to people that want to rent their property. This means that during peak seasons you could be getting 5 times the rate of your next door neighbor who is renting his/her property out on a yearly lease.
Owning Two Properties That Are Rising In Value
Rather than selling your property, you will have two properties. In most, countries property prices are going up and not down. As a result, you will not have two home that increases in value thus increasing your net worth in assets. When you do decide to pack it all in and retire, then you could end up selling both places. There are already plenty of people that have made over a million during the vacation rental business model and more that have continued to purchase further properties with their profits from their vacation rental business.
Creating Your Own Vacation Rental Website
Two words of advice that we would like to give you if you do decide to get into the vacation rental business. Firstly, if your property does become a success, then make sure you list it on as many other websites as possible. This way all the traffic those websites bring in from people searching for properties to stay in your area will be able to find your holiday home and book.
Secondly, once you have begun to make a name for your self head over to a reputable vacation rental website builder software provider like the one we just provided here and create your own branded website, You will have a fully integrated system that costs as less than 50 bucks a month.
You can sync all your calendars from all the other vacation websites you have your property listed on, you will be able to accept payments via the website, chat in real time with our guests, and have your own blog and news pages to write regular updates about up and coming events, special offers, new additions to your property like smart home technology and so on.
Hopefully, we have given you a good insight into how the vacation rental market works. If you are someone looking to invest in real estate, then this guide also applies to you. As for those of you looking to sell your home, why not try seeking the advice of a financial advisor or property management company and try to increase your wealth because right now the vacation rental market is here to stay and it is a booming industry.