Turning a rental into a vacation rental using vrbo?

[Epcotmgm]

Has anyone taken a home used for reg. rental and turned it into a rental for short stays? I'm considering this and just furnishing it to rent out. Looks like I could get a months rent with just renting out 10 days.... Just something I'm considering!

 

[timmac]

Has anyone taken a home used for reg. rental and turned it into a rental for short stays? I'm considering this and just furnishing it to rent out. Looks like I could get a months rent with just renting out 10 days.... Just something I'm considering!

Sure, you could get "a month's rent" in just 10 days... when you have renters, that is. That also assumes you can absorb the cost of refreshing/cleaning the place between renters. And can afford the costs of finding said vacation renters, and the risks of any that damage the property by any of the dozens of different renters you may have over the course of time. Then, consider having to immediately fix any issues with the property, have appropriate insurance (which may be different than what you have now). The list goes on.

Anyway, while I can't say whether or not this would be a good move, my point is that there is a whole lot more involved with a vacation rental than just raking in the cash. Of course, I suspect you'd want to employ the services of a management company or some such, but just the same, I would wager all of the overhead of a vacation rental will take a considerably greater chunk out of the profit margin than a typical lease-rental agreement.

I'd love to hear from anyone who has done this and can offer more specific insight.

 

[PrincessDadx2]

If it was me, it would greatly depend on the location. Is it a tourist area? seasonal? Is the rental demand being met? Oversupply? etc.

Talk to some real estate agents that sell vacation homes and property managers that manage them. Find out how many weeks on average homes of your type rent and what they rent for.

Then you can compare using the average rental and a property managment company to do the cleaning, getting the keys to the renter, etc. and see how it compares vs. just renting it to a full time resident.

I would not try to do a vacation rental myself unless I was in the same neighborhood or close. You have to meet someone on site every week you rent it and it takes a lot to time to manage the reservation system. If you can find a property manager who also handles the reservations and it makes you more than a full time renter (with an estimated vacancy for both) then I think you have potential to do well. Otherwise the hassle would be too much for me.

Also, you should figure the wear and tear will be higher on a vacation rental home. I would probably want to expect to make at least 10% more before switching. However, if you have a good manager and strategies for maintaining occupany in off season you can do really well.

 

[RitaE]

Well - I'm a frequent VRBO user, does that count?

Keep in mind that nightly rental fees are much higher than a pro-rated rental house - but your renters are going to expect top of the line furnishings, entertainment equipment, kitchen appliances and beds and linens. There is a cost to keeping all that current and updated as well as your costs and time in booking customers, collecting payment, arranging for cleanings and all those other details.

The people who do that kind of thing successfully really run it as at least a part-time business, or they hire a Management company which is also an added cost.

 

[Cheshire Figment]

Do your local laws allow short-term rentals? There are3 some places that the law requires rentals to be at least three months.

What business licenses will you need?

What will your insurance company require (and what will they charge you)?

I you ready to keep good records and be able to fill out a Schedule E on your Income Tax?

 

[tomi]

I have been using VRBO to rent my townhouse for 4 years. My place is in Amelia island, Florida and I live in Maine. As long as the property is in a desirable area and allows short term rentals, I would say go for it. I DO NOT use a management company. I do it all myself and it really isn't too bad time wise. I have a great cleaning woman and a maintenance guy I can call when needed. Management companies wanted 30% - there is no way I would pay them that. As long as you have fairly good organizational skills, it is doable. In 4 years, I have never had any damage or other issues. People give us great reviews and we have many repeat renters. We make a pretty significant amount of money on it even after all expenses are figured in. If you want to PM me, I can answer any other questions you have and will give you the VRBO # to check out the listing. Good Luck !

 

[Epcotmgm]

Thanks for the info! We have tons of hotels, near major hubs, near several universities. Contacted a company that does short term furnished rentals with condos only. They said the need for 3 bedrooms for short term stays is very high. I might as well try this next year. The expenses are very easy to cover if I don't have a renter. That wouldn't be an issue. Furnishing it would be the biggest expense. I looked online and found moderate/mid level furniture for the most part. Looks like stuff from typical furniture stores and ikea is being used to furnish places. Only the very pricey homes had above average furniture.