March 16, 2017
Buying a Vacation Rental: How Can Your Property Manager Help You Pick the Most Profitable Property?
When I set out to buy my first vacation home, I had planned to take the same approach that I took when buying my primary residence. I expected that I would focus on my personal preferences and my emotions.
I had narrowed it down to three properties and called in my parents to help me decide. My parents have owned more than a dozen vacation rental properties, so they know what makes a profitable vacation home. I was shocked to realize that there were so many points I failed to consider. The property I favored actually turned out to be the poorest choice if I intended to use the home as an investment property.
Buying a piece of real estate is a challenging experience. Normally, a typical buyer’s decision is heavily impacted by their emotions and personal preferences, but these elements take a backseat when you’re dealing with a rental property.
Of course, if you’ve never owned a vacation rental property, you may have no idea what makes one home super profitable and another similar property less so. And not everyone can call upon parents who are experienced real estate investors. But this is where a property manager can be a very valuable asset.
How Can a Property Manager Help You Choose the Most Profitable Vacation Home?
A property manager is typically experienced in all aspects of management, from maintaining and caring for your home to marketing and advertising the property to potential renters. In short, there are few professionals who are more knowledgeable than a property manager when it comes to identifying a potentially profitable vacation home.
So before you even acquire a vacation home, it may be wise to select a property manager who will oversee whatever property you acquire. Most property managers will be happy to serve in a consultant role.
How can your property manager help you pick out the right vacation rental home? Here are a few ways they’ll assist:
Evaluate the cost of maintenance and upkeep. Some homes have far greater requirements in terms of upkeep and maintenance, and this can have a major impact on your property management fees and your bottom line. So your property manager can evaluate the properties you’re considering with maintenance time and cost in mind.
Evaluating the marketability of the property. Location and aesthetics matter when it comes to a vacation rental. But how do you choose when you only have one of the two attributes? Do you pick the not-so-fabulous home in an incredible location with fabulous views? Or do you pick the home that’s incredibly beautiful but is in a less-than-ideal location? These are just a few of the points you may need to consider. Your property manager can help you choose the property that’s most marketable.
Evaluating the property’s overall desirability among potential guests. There is some evidence that the most desirable, in-demand properties are those that are either small and cozy, or large, spacious and able to accommodate a large number of guests. Homes that fall in the “middle ground” tend to be less profitable, which is a bit counterintuitive.
What’s more, every rental market is a bit unique in terms of its target audience. A location that’s a hotspot for honeymooners may see lots of small parties of two, making a smaller home more desirable. Conversely, a location that’s popular among families and college students may have a high demand for large homes with lots of bedrooms. Your property manager can help you ensure that you select a vacation home that will be popular among the travelers who are visiting this destination.
If you’ve selected a potentially profitable rental property and still need a property manager to help your vacation home reach its full potential, Rented.com can help. We help vacation homeowners find a local property manager who can boost bookings and maximize ROI. Create a free profile today to get started.