A vacation rental is different from a vacation property. Its main purpose is to earn you money. The fact that you can also use it yourself is just a bonus. Vacation rentals can bring in serious income but only if you know what you’re doing. Here are the key points you need to keep in mind.
Start by doing your sums
When you’re looking for a place to live, you usually start with the location. When you’re looking for an investment property, it’s best to start with the sums. Once you have at least a decent idea of what you can afford, you can look for property that fits your budget. Obviously, location will play a role but you can be more flexible with it.
If you’re thinking about financing the purchase with a mortgage, then you’ll need to work out the costs of this. The good news is that you don’t need great mathematical skills to do the sums. Thanks to online calculators, simple interest loan calculation really is simple.
Choose your location strategically
At one end of the scale, there are established vacation spots. These places get huge numbers of visitors. This fact is, however, usually baked into local property prices. What’s more, your property will almost certainly have to fight it out against a lot of competition. Some of this will be established and will benefit from guest loyalty and reviews.
At the other end of the scale, there are relatively unknown destinations. These places attract far lower numbers of visitors. They are, however, much more affordable and often have less competition. For investors on smaller budgets, the best vacation rentals are in the places that are somewhere around the middle of this scale.
Look for a property that could work as a home
Some properties are really only suitable for use as vacation properties. This means that they can only be sold to investors and people looking for vacation homes. Properties that can work either as vacation properties or as residential homes are often much easier to sell.
With that said, it might be worth looking for a property that would require work to function as a residential home. For example, a summer vacation property might be fine as a four-season home if you upgraded its energy efficiency. You wouldn’t even necessarily have to do the upgrade work yourself. You would just need to show that it could be done.
Create a unique selling point for your property
Sometimes you’ll be lucky enough to find a property that comes with a unique selling point. If you don’t, however, then it isn’t a problem. It just means that you need to create one for yourself. This is often as simple as picking a theme and there are plenty of options. For example, you could choose a period, a genre of fiction, or a concept like sustainability.
Essentially, what you’re doing is building a unique personality for your property that makes it stand out both online and in the real world. If you have the resources, you can even consider rotating themes so there’s always something fresh for people to see.