If you’re on the path to begin a career in real estate, and
your goal is be a vacation home property owner, maybe now is the time to start
investing in vacation home properties. It doesn’t have to be complicated.
In
fact, in this article we will show you in 9 easy steps how you can develop your
own short-term rental management business.
Step #1: Search for a triplex in a neighborhood you like
For those of you who are unfamiliar with a triplex, this is
a house that has been converted into three separate apartments. Each floor must
have an entrance and exit, and it needs to be self-contained.
Step #2: Ensure that local laws allow you to offer
short-term rentals
Nothing ruins a business faster than when you don’t do your
due diligence. Before you sign or buy anything
make sure you’ve looked into local zoning laws. Check to see if there are laws
against homeowners offering rooms or floors in their home for short-term rent.
If there aren’t any, then you’re golden.
Step #3: Move into one floor and rent out second floor
While this may leave you scratching your head as to why,
there are several reasons for this. One, when first starting out, you’ll want
to live in a house that isn’t costing you any money to buy. This is where your
renter comes in. By having a long-term renter, you’ll have a monthly income
that can pay your mortgage. Leaving the last floor as your vacation rental
property.
Step #4: Evaluate the risks
Before diving into the endeavor, it would be wise to talk to
a real estate agent and consult your financial planner. The agent can point you
in the direction of a good neighborhood and homes. While the financial planner
can inform and help prepare you for the tax implications. Also, something to
keep in mind when evaluating your risks is your long-term renter. They are your
steady income that is help paying our mortgage. But, what if all of a sudden they
need to leave? It would be wise to plan ahead and make sure that you always
have enough capital to cover several months of your mortgage payment, in case
your LT renter goes rogue.
Step #5: Prepare the floor to rent out on a short-term basis
This means making sure that your vacation rental is decked
out with high quality furniture, appliances, sheets, towels, gadgets, and more.
Make sure the living room especially is furnished with all the “fixings”, such
as a TV, surround sound, comfortable couches, nice coffee tables, etc. Think of
this as a multifamily leasing technology room. Meaning, you want it current and
up-to-date. The goal is to provide your vacation renters with a premium
experience that will help get them to spread the word about your property.
Step #6: Prepare a welcome packet
This is a nice touch that should never be ignored. While it
seems simple, it will help give your renter important information about your
property, the amenities you offer, and the community around them.
Step #7: Place your property on as many vacation home rental
marketplace sites as possible.
This is a great way to advertise your property and get eyes
on it. Again, think of these portals as yet another multifamily leasing
technology resource. Because, not only does this help attract people to your
rental, but also it will allow you to receive payment thorough a secure portal.
Even though you live in the same house, the only way you want to accept payment
is through one of these sites. Reason being, it is the easiest and most secure
way to ensure that you always receive your funds.
Step #8: Be friendly
This is pretty much self-explanatory. It’s just good customer
service. So, let your guests know that you are available for any questions,
comments, or concerns they may have. And point them in the right direction for
fun things to do around town, or good places to eat.
Step #9: Buy another property when you can afford it
This is the only way to grow your business. So, when the
time is right, and the funds are there consider purchasing another property.
Except maybe this time it can be a single-family property that is only used for
short-term renters. Once that one takes off, purchase another. And so on and so
forth until you have your own little vacation rental kingdom!
