Owning a vacation rental property in a desirable area is a reliable source of passive income that can pay you for a lifetime, and investing in the ideal home makes all the difference. If you pick something that’s in the wrong area or in a city where the laws towards short term rentals are strict, it can be more difficult to book your rental and bring in the highest nightly rate. This brief guide will show you how to find an ideal vacation rental investment property and manage it successfully.
Building a High-Value Real Estate Portfolio
The first key to finding a good second home rental property is to purchase properties in strategic locations. Luxury rentals, in particular, should check many boxes that increase their desirability. Desirability means more views, and therefore higher rates and occupancy, making you more money. Factors that influence these characteristics are:
- A desirable location.
- A well-maintained and up-to-date property.
- Having expected luxuries such as a great outdoor space, pool, private gym, gourmet kitchen, wet bar, and more depending on the property type.
- Proximity to desirable amenities.
- Exclusivity and privacy.
- Easy access to 24/7 customer support through a property manager.
For starters, think up-and-coming neighborhoods, beach houses, luxury homes in popular tourist destinations, or quiet, family-oriented blocks adjacent to major metro areas. People are willing to pay top dollar for the best amenities and most convenient locations.
Being close to the interstate yet having that “away from it all” feeling is highly-valued by remote workers and family travelers, especially when combined with luxury amenities and guest-oriented hospitality design. Finding these gems takes time and work, but once you have them in your real estate portfolio, you can start generating excellent long-term income streams.
As we move into a world where more people can work from home, the length of stay has gone considerably up. At Open Air Homes, we have shifted focus into catering for these extended stay guests, and you can appeal to them by outfitting your home with all of the amenities so that guests can live there comfortably for extended periods of time: high speed wifi, desk space, proper kitchen utensils and pans, and outdoor space.
Pitfalls to Avoid
Avoiding financial pitfalls is a big part of developing a successful investment strategy. When you learn what not to acquire, you can save yourself a lot of time — and financial loss. If the purchase price looks too good to be true, it is probably going to be a big amount of work, and likely won’t be worth the reno. For instance, if any property is too run down to fix up without losing money, leave it to the house flipper professionals.
Also, any property in a location that is too “out of the way” from desirable amenities or popular areas should be avoided. For example, a home at the end of a bumpy dirt road without access to the electricity grid will become a big nuisance to your guests. Your goal is to develop a portfolio of properties that attract a lot of interest so that people are willing to book for luxury prices. But since discerning the difference between “undesirable” and “has potential” can feel daunting to a casual investor, it’s best to consult a real estate broker to make sure to make a wise decision.
Work with an Experienced Broker
There are plenty of homes in California that meet the profile of a desirable vacation rental or second home. To stay on top of trends and acquire properties in areas that are projected to become popular spots, it’s important to work with a professional real estate brokerage company. You’ll connect with experienced real estate agents and brokers who can identify desirable beach houses, penthouses and more that will bring in a high short-term rental value. The right choices can lead to you earning double compared to a standard long-term luxury rental. There are even sites (which our team has access to) like AirDNA, that can help you determine the demand of homes in the area you are looking to purchase.
Since the real estate market is always in flux, you need someone fully educated in this field and constantly learning about market trends. Luxury real estate agents, in particular, are keen on identifying the hot properties and “diamonds in the rough” that you can renovate and market for top dollar. So, if you’re ready to find properties that are worth your time, get connected with an agent today.
Because short term rentals are our primary focus at Open Air Homes, we often have exclusive cash-flowing homes with a built in review system that are available for purchase. A number of our clients have sold their furnished home to new clients and decided to continue working with us. In the process, they never missed a day of monetization, and ensured that they were purchasing a property with a proven track record of happy guests and great reviews.
Discover Effortless Ownership with Property Management
If the thought of stressful interruptions and regular rent acquisitions makes you hesitant to become a landlord, you’re not alone. You may also live in a different state, making it less practical to manage the property yourself. The last thing you want to deal with is an angry neighbor or guest at 10pm at night, which is where we come in.
This is why many successful homeowners have made the decision to outsource tasks like lease drafting and maintenance calls to property managers. You can take the stress out of being a landlord and experience the joy of effortless ownership by recruiting the help of an experienced property manager. This enables you to reap the benefits of owning short-term luxury rentals without the phone calls or paperwork. When you do want to use your home, just block out the calendar and enjoy the same level of concierge service received by rental guests in your home.
Invest and Grow with Open Air Homes
Open Air Homes works in partnership with OpenAiRE, our real estate brokerage sister company that helps people buy and sell investment properties. When you work with us, you have the opportunity to find, buy, and monetize an impressive portfolio of investment properties (without all the stress). From property management to hospitality design to monetization, we are here to help. Contact our team today to book a consultation and learn more about our Effortless Ownership property management system.