The popularity of short-term rentals has increased quickly over the last few years. As a Richmond Heights rental property owner, you might be considering buying or converting one of your properties to a short-term rental. Before you do, it is an excellent strategy to initially study both the pros and cons of owning a short-term rental property. While short-term rentals are a good fit for some, a few investors may think that the workload needed isn’t worth it.
An initial advantage to owning a short-term rental property is the potential for better rental income. Short-term rentals commonly rent for more per day than a long-term rental would. So if you can keep your property rented out, you could gain a bit more each month than you would earn from a long-term lease. Short-term rentals let you increase prices at times of high demand, allowing you to maximize your profits.
Another important benefit of owning a short-term rental is that it offers a lot of flexibility. It depends on how you do it; you could be renting your property a week at a time or for several months. If your rental property is in a nice vacation spot, you could utilize any vacancies as an opportunity for a personal getaway. You can also efficiently put your property on rental platforms like Airbnb, which means you don’t need to deal with leases. You can also remove your listing from those sites at any time if you prefer to return your property to a long-term rental.
In different circumstances, there are a few drawbacks to owning a short-term rental. While there is often a strong potential for higher income, that income is also a lot less stable. Some short-term rentals undergo seasonal fluctuation, which means your property can be far more vacant than you would prefer. Even though excellent marketing and creativity might help you avoid this, it is worth noting that even your unique ability may not be enough. Short-term rentals are very vulnerable to economic conditions, and economic downturns often result in less demand.
Another common obstacle of short-term rentals to take into consideration is that you will have higher costs. Preparing a short-term rental demands that you furnish it and stock it with essentials. If you want your property to be competitive, it will need to have nice furnishings and décor. You are also required to supply your tenants with such things as linens, toilet paper, pots and pans, and more. These items will need to be re-stocked between tenants, which can start to add up over time.
There will also be additional cleaning and maintenance required for a short-term rental. If you’re doing it on your own, making the place ready for the next tenant will take quite a bit of your time. But hiring someone to do it for you could get pricey, particularly if your property is in high demand. It’s essential to guarantee that the house is being thoroughly cleaned between tenants and that additional maintenance and repairs are being done correctly and at the appointed time. If you’ve failed to do that, it may give rise to bad online reviews and fewer bookings eventually.
At last, it’s critical to check state and local regulations on short-term rentals. Few cities have established strict regulations disallowing short-term rentals in some areas, and so have many homeowners’ associations. Because restrictions will vary all over the place – and even from neighborhood to neighborhood – it is advisable to do your research before buying or converting a property to use as a short-term rental.
Need help managing your current rental property? Give Real Property Management Endeavor a call at 636-244-5959. Or conveniently contact us online.
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