Buying a vacation rental property can be one of the best decisions you can make…if you know what you are looking for. If you don’t, you can end up losing a lot of money and not enjoying your vacation. A vacation home can function as great rental property, but you need to know the basics. Here’s what to look for when buying a vacation rental property:
As it is true with buying almost any real estate, the location should be a determining factor when buying a vacation rental. You want to choose a vacation rental property by looking for what the area has to offer you. Check out things like:
Since this property will function as both a vacation home and rental, you need to think about the easiest way to market your property. It not only needs to work for your family but others as well. Buying a vacation rental property is also dependent on the type of rentals you will allow. Are you looking for a 6-8 month rental agreement or month-to-month agreements? How about Airbnb or house hacking to cover the cost of your home when you aren’t there?
Being close to your vacation rental could be in your best interest should you run an Airbnb, while hiring a property manager can be better for more long term rentals. If you are going to be a first-time landlord, it’s important that you understand everything about the area your vacation home/rental property is going to reside in. Live close to make life easier on yourself.
Although buying a vacation rental property can be seen as a place to get away from your worries, you should first view it as a business. You will need to market your services and amenities to potential renters should want to turn a profit on the home or at least cover the mortgage. Don’t get caught in the wrong area only for prices to fall.
The home buying process is going to be different if you are specifically buying a vacation rental property. Most of the time you end up paying more in loans for your vacation home because people won’t be living their full time. On top of that, there are also certain regulations and laws you have to consider before you even buy.
In some areas, you can’t buy a home with the intention of renting it out. Furthermore, some places prohibit the use of Airbnb and services like it. Consider this when looking for a vacation home. You don’t want to buy a home only to realize you can’t rent it.
A vacation home is an investment. Whether you want short or long term rentals, you need the home to grow in value over time. Look to buy a vacation rental property in areas or neighborhoods that are growing.
Check crime statistics, average living expenses, and property rate increases as you do your research. You can try to improve the value of the home by adding renovations but always do the cost-benefit analysis for each project.
The right realtor can help you find your dream vacation home in the right location to turn a profit. They will also help you spot the correct districts and neighborhoods to help you get the best appreciation for your investment.
If you buy a vacation rental property that you can’t actually use to your family’s benefit, you’re going to regret it. You don’t want to go on vacation only to be cramped in close quarters or far away from the activities that you want to do. Instead, write down a list of “must-haves” for your vacation home just as you would your regular home. This will help you narrow down your search and help your realtor focus in on what you specifically want.
Know what your needs are and how buying a vacation rental property can fit those needs
Are you considering buying a rental property that you want to use for vacation rentals? Not sure where to start or need information about your dream area? We can help! At MWT Realty, we can put your family in the home of their dreams! Contact us today to get started!