How to Turn Your Vacation Rentals into Income Properties
Acquiring a vacation home is a big step. After investing so much money into making it yours, you’d probably like to be able to keep enjoying it for many years to come. Why not make some money while doing so? By turning your vacation home into an income property, you can do precisely that.
Turning a vacation home into an income-generating rental takes some work. There are no guarantees when it comes to how profitable it will be, but there are things that you can do to increase overall profitability and rentability. By keeping the following 10 tips in mind, in fact, you can enjoy the use of a lovely vacation home while watching it virtually pay for itself. What could be better than that?
Research the cost of similar rentals
Check rental sites like Airbnb and VRBO to see how much similar homes in the area are fetching. Resist the urge to find the cheapest nearby rental and to undercut it, though. Doing so may attract bargain hunters, but it will also reduce the overall perceived quality of your rental and keep you from enjoying as many profits.
Hire a professional photographer
When it comes to fetching top dollar for a vacation rental, it pays to have a professional photograph the place. These days, photos taken with smartphones won’t cut it. The best photos put the place in the best light both figuratively and literally, and a professional photographer knows how to do so effortlessly. Ideally, you should offer at least 20 optimized, professionally taken shots of the premises. Consider including a photo of the floorplan too.
Ask for guest reviews
Your rental property will appear more prominently in searches when guests leave reviews regularly. Guest reviews also show the general public that others have stayed at and enjoyed your rental, which is important. Unfortunately, people tend to only feel compelled to write reviews when they are unhappy about something.
Take steps to encourage guests to leave reviews of the place by including a note in the welcome basket or by sending follow-up emails after their stay. Technically, you shouldn’t offer anything in return for reviews, but it never hurts to gently encourage people to leave them for your property.
Include amenities and make sure they are well-maintained
You will fetch a much higher price for your vacation rental when you load it with modern amenities. In fact, people have come to expect things like flat-screen TVs, stainless steel kitchen appliances, and electronic entry. However, don’t bother with these amenities unless you’re willing to actively maintain them. Otherwise, they will inconvenience renters more than anything, and this could lead to bad reviews and other issues.
This should go without saying, but it’s crucial to ensure that your vacation rental is being effectively marketed. One easy way to make this happen is by listing it on a national website like VRBO.com or Airbnb. In that case, follow instructions on the site, and complete as much of the listing details as possible. Share links to your property on your personal social media pages and make sure to respond to guest reviews as well — especially if they are negative. When people see that the owner is proactive about keeping guests happy, they will be more likely to want to rent it.
Offer one-night rentals
People who own and rent out vacation homes are often reluctant to offer one-night rentals because they involve more frequent cleanings and the like. However, if you don’t offer them, you’re certain to end up with many large gaps in your vacation renting schedule.
Remember that the shorter the stay, the more that you can typically charge per night. The extra cash should more than make up for the extra cleanings, and it will allow you to generate income more consistently throughout the year.
Offer your vacation home during peak season
This one may not sit too well with you, but by offering your vacation home for rent during peak season, you can command especially high rent prices. If possible, shift over to using the home yourself during fringe seasons. For example, during the late spring and early summer or at the end of summer going into fall. Any qualms that you may have about missing prime time in your home should be quelled by the extra cash in your pocket.
Include some fancy extras
One way to really go the extra mile and to justifiably ask for higher rents is by including at least one or two big-ticket extras. If you own a vacation home on or near the beach, for example, you might invest in some paddleboards, kayaks, or rafts for your guests to enjoy. Offering nice, well-maintained bicycles for the whole family is another great option that’s sure to generate more interest and income. Homes with private pools and hot tubs also tend to do quite well when compared with other nearby properties.
Be flexible in the off-season
All too often, vacation home owners turn up their noses at the off-season because rates tend to be so much lower. However, rental nights are perishable; once they pass without being booked, the potential rental income can’t be recouped. It’s far better to adjust your pricing to keep the home booked and, in turn, to keep income rolling in. At the same time, being flexible about renting your home during the off-season helps to keep feedback coming in, and those reviews help to make your place more marketable and attractive.
Use profits to update and upgrade
If you expect to own your vacation home for the long term and want to keep your profits climbing, you should reinvest some of them into upgrades and updates to your home. Look at homes in the area with features that yours lacks, and then add them as you can by investing some of your profits. This might mean swapping out an old tile kitchen for one with gorgeous granite counters or adding an upscale fire pit or other outdoor living elements to the property.