The popularity of short-term rentals has risen dramatically over the past couple of years. As a Decatur rental property owner, you may be thinking about buying or converting one of your properties to a short-term rental. Before you do, it’s a great idea to carefully examine both the pros and cons of owning a short-term rental property. Although short-term rentals are a good fit for some, several investors can believe that the cost of effort needed isn’t worth it.
The main advantage to owning a short-term rental property is the opportunity for higher rental income. Short-term rentals are regularly rented for more per day than a long-term rental. So, if you can keep your property rented out, you can earn a little more each month compared to what you get from a long-term lease. Short-term rentals let you increase prices at times of high demand, which allows you to maximize your profits.
A good additional benefit of owning a short-term rental is that it provides a lot of flexibility. Depending on how you manage 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 use any vacancies as a chance for a personal getaway. You can also quickly post your property on rental platforms like Airbnb, ensuring that you will never struggle with leases. You can also remove your listing from those sites at any time if you wish to transform your property again to a long-term rental.
Then again, there are a few drawbacks to owning a short-term rental. Even though there is always a decent potential for higher income, at the same time, that income is a lot less stable. Several short-term rentals encounter seasonal fluctuation, meaning that your property might be sitting empty a lot more than you would like. Even though excellent marketing and creativity might help you avoid this, you must understand that even your finest intentions may not be enough. Short-term rentals are very sensitive to economic conditions, and economic downturns often result in less demand.
Another significant drawback of short-term rentals to bear in mind is that you will have higher costs. Preparing a short-term rental requires you to furnish it and stock it with essentials. If you want your property to be competitive, it must have good furnishings and décor. It is also important that your tenants have linens, toilet paper, pots and pans, and more. These things must be re-stocked between tenants, which will begin to add up after a while.
There will also be a lot of cleaning and maintenance required for a short-term rental. If you’re doing it personally, getting the house ready for the next tenant will take quite a bit of your time. However, hiring somebody to perform this for you can be costly, specifically if your property is in high demand. It’s vital to guarantee that the area is being thoroughly cleaned between tenants and that required maintenance and repairs are being done correctly and quickly. Neglecting to do so could end up in bad online reviews and fewer bookings someday.
Ultimately, it’s imperative to check state and local regulations on short-term rentals. Several cities have created strict regulations prohibiting short-term rentals in some areas, and so have many homeowners’ associations. Because restrictions will vary from one place to another – and even from neighborhood to neighborhood – it’s vital to conduct your research before buying or converting a property to use as a short-term rental.
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