Financials of vacation rental property

[cckwmh]

I think in NH you could get summer/fall rentals too. Think families that go to Santas Village, storyland etc. There is more to do for families I think in NH near the ski resorts, and it is a shorter drive than Vermont. We often rent in NH in April and just hike and shop. Just to get away from MA.

[basil]

I think in NH you could get summer/fall rentals too. Think families that go to Santas Village, storyland etc. There is more to do for families I think in NH near the ski resorts, and it is a shorter drive than Vermont. We often rent in NH in April and just hike and shop. Just to get away from MA.

This is a good point. I had been more strongly considering VT due to driving distance/traffic patterns from where I live (west of Boston), driving to VT allows me to avoid 95N at rush hour. But yeah, we have been to NH in summer (Loon and Attitash) and never wanted to go to VT

[basil]

Doublepost

[basil]

It was sort of (sort of) easier for us. We knew that the rental season is really only three months so we knew the most we were likely to be able to rent it. We got lucky - we learned after we rented how controlled (by the HOA) the leasing terms are. We also priced right and got good pictures (can’t emphasize how much a professional photographer pays off) and have rented literally every day we’ve wanted to rent it.

For upkeep - we charge renters a cleaning fee, and most rentals do. If you will use and rent a lot you may not need a home watch - we have to have that. But two of the most important people in your lives will quickly become the cleaning service and home watch and/or handy man. (Your management company may take care of both. If so, THEY become important.)

We have had very minimal damage but you have to plan on some. If it’s not “wear and tear” the security deposit and terms of your lease will cover in theory. We replaced dishes that became chipped and some minor water repair where a renter didn’t put a shower curtain in the tub. The rest has been us continuing to upgrade as we bought turnkey. My cousin had rented a lake house out for years. His suggestion was to provide cleaning supplies etc - if they are there people will use them, and use what you would like them to use. We have only had one renter where the cleaning service said that they left it less than clean. The rest have kept it really clean. I think some is the price point - people who pay what we charge are used to living in a nice place and taking care of it.

When you determine price look on Zillow for “way far out” to see the range of prices - then closer in to see what’s no longer avail/people have rented. (Make sure to look at a comparable season.) Are people paying up for nicer and those rent first? Is money a real object and cheaper rents first? We priced “kinda low” the first year to get reviews and have been creeping up since. We aren’t at top of market but top third and we will stay there.

Reviews are a BIG deal. Consider having a friend rent via VRBO, and reimburse them for everything including booking fees, if you aren’t getting rentals. Even one review is better than none. Again - we got lucky and rented the first year without doing this. We directly ask our renters to leave a review.

We also benefited a bit from my “love of the chase”. We routinely get comments on how well equipped the kitchen is, how nice the linens are etc. I knew good deals on quality stuff and took advantage and saved a lot. Happy to share suggestions there as well.

Let me know what else I can answer!

This is really good advice and now I have a project for my next day off!

I would LOVE furnishing a place from yard sales and close outs.

What was your goal when you bought your condo? To make money or for investment? Do you manage it yourself or does someone do it for you?

[bnme]

Just wanted to mention that we love Vermont in the summer, although we go further north. Stowe and Burlington are great for hiking, biking, exploring.

[KpbS]

Any options that would be closer than 3 hrs away? I think the closer it would be to your primary residence, the more you would likely use it. We grew up with a vacation home an hour away and that was a good distance.

[erosenst]

What was your goal when you bought your condo? To make money or for investment? Do you manage it yourself or does someone do it for you?

Easy one first - we manage it ourselves. It's doable because only three leases a year, and we have a good handyman who lives very nearby. Even with that it can be a bit time consuming - partially because the HoA requires a boatload of paperwork on each renter, the club requires a transfer of ownership, etc. Communicating with the renters themselves has generally been very very easy.

Harder question - we really bought it for ourselves. DH's family had a condo on the east coast of Florida forever. We thought that when his mom died we might buy it out/share it with his sisters. Over time it became more apparent that the condo was (very) expensive, wasn't set up to meet our needs, and owning with his sisters would be an unmitigated disaster. When we were there for our last visit before it was ultimately sold, we drove to the west coast of Florida for a day, with DD, and met a realtor. Saw a few places just to get a feel of what money would buy. We liked it and scheduled a trip without DD to look more seriously. We found 'love it' while there - and the market is still depressed from overbuilding before the 2008 crash so prices were good. We decided to buy, but knew that we couldn't use a ton at least til DD graduates HS in 2022. The annual "carry" (taxes, insurance, HoA, mandatory club, utilities etc) is high - so renting offsets that and we're able to rent between the day we leave after winter break til the day before we get there for spring break (or close - depends a bit on how calendar falls).

It's also given us time to upgrade/refresh over time - new kitchen appliances, W/D, AC, water heater, carpet in bedrooms, some furniture, etc. We knew most would be needed when we bought so not a surprise, which also helps. See separate thread on master bath and flooring. Another way to think about the rental is that it's covered most of this.



I want to continue renting after DD graduates; DH doesn't. We'll see where the compromise lands .

Happy to answer further questions!

[marinkitty]

We have a rental property in Montana. We bought it fully furnished (and then spent about $5K replacing rugs, bedding, throw pillows and blankets, art and some kitchen items that were worn out) and it had already been on the rental market (though used my the semi-local owners more than we use it and there are lots of other similar places I could use for comps), so I had all the numbers I needed to figure out what the run rate would be between the prior owners and the real estate agents. I then interviewed three local management firms (ski town so there are great full service agencies that will do all the maintenance, cleaning, booking and marketing for you) and found out what their costs would be and what the range of net rental income they felt sure we be able to earn. We have now owned the house about two years and our projections have been surprisingly on target, even with the pandemic (we took a hit with lost ski rentals in March and April but then had unbelievable rentals in summer and fall and already winter, spring and next summer look good) and we even stayed there for a few weeks in the late spring and summer this year, which cut into our income. We have had some "surprise" expenses - an ice dam that caused some damage, needing to replace the beverage fridge, washer and dryer so be sure to assess that and assume you will replace things sooner than later. Our management company took care of all the repairs - we just had to pay - so it wasn't a hassle for me in terms of time or management. We plan to live there part of the year when retired and use it here and there until then, so our goal was to get most of the annual expense covered but not make money. We did budget for a bigger shortfall in case of a really bad rental year. We are using the place for winter break this year which is a massive hit to our rental income, so the amount we pay out of pocket will be substantially bigger this year than last, but that was our choice.

[musicalgrl]

It was sort of (sort of) easier for us. We knew that the rental season is really only three months so we knew the most we were likely to be able to rent it. We got lucky - we learned after we rented how controlled (by the HOA) the leasing terms are. We also priced right and got good pictures (can’t emphasize how much a professional photographer pays off) and have rented literally every day we’ve wanted to rent it.

For upkeep - we charge renters a cleaning fee, and most rentals do. If you will use and rent a lot you may not need a home watch - we have to have that. But two of the most important people in your lives will quickly become the cleaning service and home watch and/or handy man. (Your management company may take care of both. If so, THEY become important.)

We have had very minimal damage but you have to plan on some. If it’s not “wear and tear” the security deposit and terms of your lease will cover in theory. We replaced dishes that became chipped and some minor water repair where a renter didn’t put a shower curtain in the tub. The rest has been us continuing to upgrade as we bought turnkey. My cousin had rented a lake house out for years. His suggestion was to provide cleaning supplies etc - if they are there people will use them, and use what you would like them to use. We have only had one renter where the cleaning service said that they left it less than clean. The rest have kept it really clean. I think some is the price point - people who pay what we charge are used to living in a nice place and taking care of it.

When you determine price look on Zillow for “way far out” to see the range of prices - then closer in to see what’s no longer avail/people have rented. (Make sure to look at a comparable season.) Are people paying up for nicer and those rent first? Is money a real object and cheaper rents first? We priced “kinda low” the first year to get reviews and have been creeping up since. We aren’t at top of market but top third and we will stay there.

Reviews are a BIG deal. Consider having a friend rent via VRBO, and reimburse them for everything including booking fees, if you aren’t getting rentals. Even one review is better than none. Again - we got lucky and rented the first year without doing this. We directly ask our renters to leave a review.

We also benefited a bit from my “love of the chase”. We routinely get comments on how well equipped the kitchen is, how nice the linens are etc. I knew good deals on quality stuff and took advantage and saved a lot. Happy to share suggestions there as well.

Let me know what else I can answer!

I just replaced a few bedrooms worth of linens and also bath items but now I need to tackle the kitchen in a VRBO property. I’d love to chat about ideas for good quality replacements!


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[musicalgrl]

I’m currently outfitting a rental and would love to chat about ideas for good quality items that won’t break the bank!

Edited to add: I tried to DM you erosenst but your mailbox is full.


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