When most people think about investing in real estate, they think of two things: fixing and flipping or buying and holding. Vacation properties can benefit both you and your real estate portfolio.
We have seen the rise of sites like AirBnB and VRBO which let travelers rent rooms or full houses from other people. This trend is very helpful for real estate investors because it allows us to increase the occupancy in our vacation properties.
In today’s blog post, I am going to show you how you can leverage your vacation properties using rental sites.
Using AirBnB and VRBO for Leveraging Vacation Properties
Time Your Stays
The first thing you should know is that the high vacation season is from December through March. You will typically get a higher nightly price during these months, so keep that in mind as you plan your stays in your vacation property.
Ideally, the revenue you get from the 12-16 weeks you rent out the property should pay for the whole year.
The Price is Right
The main reason people use sites like AirBnb or VRBO is because the properties tend to be cheaper than hotels in the area. Make sure you consider that as you list your property.
You can raise the nightly price during the peak seasons and on holidays. Make sure you are paying attention to the other properties in your area.
Location, Location, Location
If you own a vacation property, you likely chose it because of the location it is in. My wife and I used to own a condo in a popular ski area in Colorado. You may own a house on a beach, or somewhere else that is in high demand.
When you are listing your property, it is essential that you highlight the great location you are in. Take plenty of pictures and describe what it is like to be in that location.
I hope this post has taught you more about leveraging vacation properties. Do you have experience listing your property on a site like AirBnB or VRBO? Share your thoughts in the comments!
How do you financially structure the vacation home – as a rental property or as a second home? Which is best when it comes to taxes? We appreciate your wealth of information and willingness to share your expertise!
You can do either, it depends on which tax benefit you are trying to get. If you classify it as a second home, you get a Capital Gains Exemption. However, if you classify it as a rental property, you will get all the tax benefits of an investment property, but you will not get the capital gains exemption.