Short-term rental properties are increasing in popularity among real estate investors. They are also becoming more popular among tourists who want an authentic experience staying in neighborhoods where the locals live. Real estate investors are finding short-term rental properties to be as profitable as long-term rentals.
The rules for investing in a short-term rental are a little different than investing in a long-term rental. You must have adequate knowledge about this segment of the real estate industry to maximize your profits. Here are a few things you should know about short-term rentals before you decide to invest.
Finding the Right Location
The tourism industry is starting to make a comeback after the nationwide COVID-19 economic shut down through most of 2020 and the first few months of 2021. People are eager to get out and travel to their favorite tourist destinations. Vacancies in vacation towns and tourist areas are abundant.
This situation allows you to invest in a short-term rental and make good money. Look for a short-term rental in a tourist area that is desirable and affordable, especially in areas where there are mountains, beaches, national parks, and entertainment attractions. Always look at home prices, demographics, and average rent prices before investing.
Look for the Best Property
The best short-term rental property depends on the location. Some areas have many available condos and multi-family properties, while others have plenty of single-family homes for sale. Each type of short-term property has features that attract certain types of guests. Your job is to analyze the properties for sale to find the one with the most income potential. This analysis should include comparing the occupancy rates and nightly rental prices of other short-term rentals in the area.
Check for Regulations
Many municipalities have strict regulations regarding how you can operate your short-term rentals. Some cities do not allow investors to run a short-term rental. Some tourist-friendly cities with strict regulations for operating short-term rentals include New York City, Las Vegas, New Orleans, and San Francisco. There are also different regulations on how you run a bed-and-breakfast or a transient vacation unit. You should talk to a local real estate attorney who can explain these regulations before investing in a short-term rental property.
Market Your Property
The only way you can earn an income on your short-term rental property is to attract tenants. It is not enough to list your property online, describe its best features, and talk about the local attractions. Your property should have curb appeal, be clean and furnished, and it should not have any electrical or plumbing problems. You need to give your tenants the best experience possible.
One area that meets a lot of these criteria is Estes Park, Colorado. Estes Park is at the eastern entrance to the Rocky Mountain National Park. This mountain town has plenty of scenic beauty for visitors to explore during their outdoor adventures. There are also plenty of homes for sale in Estes Park for you to invest in a short-term rental. You will find many short-term income-producing properties in Estes Park.