The travel and tourism industry has seen a significant increase now that people feel better about returning to vacation mode. And, it seems like they’re making up for lost time with numbers bouncing back with gusto in most places across the US and many places globally.
But the way people are vacationing has changed, too. This increased interest in travel has also seen some significant changes in the industry. People are flocking to outdoor activities, rural areas, and private vacation rentals and are showing less interest in hotels and international and urban destinations.
And this is great news for anyone thinking of investing in vacation rental property!
Location
We all know the golden rule of real estate is location, location, location. Quite simply, the location of a property is more important than anything else. It’s literally the one thing that cannot be changed. That’s why it’s critical to research an area thoroughly before you purchase.
But what are you looking for? One, it may ideally be a place where you, yourself, would like to vacation or where you’ve vacationed or spent time in before that you enjoyed.
Once you’ve narrowed that down, do a thorough market analysis of the area. What type of attractions are nearby? Are the number of people who visit fairly consistent year-round, or is it only summer or winter when you expect to find renters? The income your property will generate will often depend on the season. A house near the water will attract more interest in the summer. A house near a ski resort will thrive during the winter months.
You will also want to investigate the average rentals for other properties in the area and factor that into your monthly overhead. Ideally, you’ll want to charge 10%-20% over that without it being so high that you’ll drive away potential renters. You may also want to hire a property manager to manage, advertise, and maintain your investment, so that cost will need to be factored in as well.
Consider protecting yourself and your assets from litigation by establishing a limited liability company for your rental business. In order to form an LLC in Oregon, you can hire a lawyer or use a formation service which is considerably less expensive.
The Property
Homes are the most common vacation rental property people invest in. They can be in small towns, big cities, a suburb, or right on the coast. If you’re appealing to honeymooners or retirees, a one-bedroom home will be fine, but if you’re planning on attracting families, you’ll want at least two bedrooms and preferably three with at least a small backyard.
Apartments and condos are also excellent options as vacation rentals or B&Bs. Just make sure that there are no pre-existing property rules excluding that.
A cottage near a vineyard, an elegantly outfitted barn on a ranch, or an upscale and beautifully furnished bungalow in the woods are all possibilities for vacation rentals, too.
Popular Destinations
Gold Beach, Oregon, is one of the most beautiful vacation spots in the country. There are miles of uninterrupted, secluded beaches, and it’s one of the warmer and lower-lying towns on the Oregon coast. Its scenic waters wind through the Rogue River-Siskiyou National Forest and are enjoyed by hikers, boaters, and fishers alike. Gorgeous views, good weather, an easy-going attitude, and natural attractions make it an excellent vacation destination. You can check out all the Gold Beach housing options and market trends here to help you decide if this is the ideal spot for your vacation rental investment.
According to Avanstay, the number one place to invest in rental property is in Joshua Tree, California. With rental revenue up 113% and monthly rental incomes averaging $4,420, Joshua Tree is a top vacation rental location. Its own National Park and proximity to 23+ million people translate to steady bookings for rental owners. And it’s priced below many California markets at $400,000 for a 3-5 bedroom ranch.
Chattanooga, Tennessee, is fast becoming one of the hottest markets in the country for vacation rental investments. Set in the foothills of the Appalachian Mountains along the Tennessee River, Chattanooga provides a strong investment opportunity with an average occupancy level of over 70% for the year and an average home price of approximately $283,000. One of the biggest attractions in the area is the Lookout Mountain Incline Railway, which brings passengers to historic sites and trails with stunning views. The old saying that you can’t go wrong investing in property is as true now as it ever was. So why not buy a place that can be a source of income while giving you a great vacation getaway?
Guest Author: Linda Chase AbleHire.org