Have you ever thought of investing in vacation rental properties?
Just like any other rental property investment, a vacation rental home purchase comes with a few pros and cons. And, knowing which ones might impact you can help determine whether or not it’s a financially savvy move.
Keep reading for all the details!
Extra Income
Vacation rental property can help you earn extra cash. In fact, the average Airbnb rental rakes in over $900 per month! And, hosts in major in-demand cities can earn up to four times that much.
Best of all, depending on how you manage the property, you might be able to list it on multiple platforms. Or, opt for long-term renters for a more passive source of income.
Depending on where you buy, it might be possible to combine these strategies with multiple-month long rentals during the slower seasons and quick bursts of income around the holidays and peak periods.
Your Getaway
Owning a vacation rental property also allows you to take a break whenever you want, without paying for a hotel room. But, only if you purchase in an area that you’d enjoy visiting. This means that choosing the best place to buy a vacation rental property is essential, and your decision should be based on an area’s desirability to both yourself and potential clients.
This same rental property could also be used later as your retirement home, or nest egg to help cover living expenses later in life, should the need arise.
Management and Maintenance
One of the downsides to owning vacation rental property outright is the need to manage and maintain it.
While you’ll have the freedom to visit any time you want, unlike timeshares and shared homes, you’ll also be responsible for all elements of the property’s upkeep. And, depending on where the home is located, this could add up to substantial monthly spending.
Consider homeowners association dues, condo fees, property taxes, and other local fees when determining which is best for you. And, click here to read more about timeshares, transfers, and how this type of investment differs from owning a vacation rental.
Where You Can Buy and Rent
If you’re hoping for an income-generating vacation rental, you’ll need to do some research first.
In some areas, short-term rentals are highly restricted or completely prohibited, limiting your ability to generate an income freely. This is especially true of tropical islands, highly exclusive resort areas, and high-end neighborhoods.
This often leaves the best resort and island vacation property to long term renters and owners that live on site.
Investing in Vacation Rental Properties Made Easy
Now that you’ve learned a bit more about investing in vacation rental properties, it’s time to weigh all the options and decide what’s best for you. Keep this guide handy while you do the research and weigh all your possible options!
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