Short Term Rentals
With companies like Airbnb, HomeAway, VRBO and others, renting and managing short term rentals is becoming more and more common and less complicated. Some dwellings are used in their entirely to generate income while others are only rented at some period of the year and even only a part of the house.
In any case, it is very important to take into account some guidelines to protect the property and yourself as much as possible.
1. Check the local rules and laws for short-term property rental
In order to avoid falling into the illegal property rental business, it is necessary to abide by the rules imposed by the authorities of the town, city or area where the property is located. In some places you need a license from the city and another from the sub-division where the dwelling is located. If you live in a condominium, you will probably need to register and check with the association since there are usually rules about the length of time that the unit can be rented. Therefore, check with all legal institutions that regulate the property.
2. Have rules and regulations clear for the use of the property
It is important to set up the rules and regulations on what can and cannot be done at the property. If the dwelling is managed under an association, be sure to include those regulations and make the guest sign and accept. Issues such as association application, time of checking in and out of the property, rules on noise, parties, number of guest, among others have to be clearly stated and agreed with the tenant.
3. Setup the right price for the short term rent of your property
Price the property according to market value. Short term rental prices usually fluctuate depending on demand, therefore it is important to pay attention on the price and be able to change it accordingly. Check for special events in the area, holidays and any other event that might affect the rental price and set it up in advance. Be sure to include all the expenses in the price, such as hotel taxes, cleaning fee and others.
4. Keep your finances in order, taxes, expenses and reporting
Most of the time short term rental taxes have to be collected from the guest and reported every month to the local governing agency. Many times even if there was no rental, this must be reported to the specific governmental institution. Make sure you have a system in place to facilitate these activities. Check with your accountant to follow the tax regulations. You may be able to deduct certain expenses such as mortgage interest, real estate taxes, causality losses, maintenance, utilities, insurance and depreciation.
4. Customer Support and Reviews
Keep an open communication with the guest before, during and after their stay. Make the arrival process friendly for your clients, during their stay be available for any questions they may have, and after their stay ask for opinions and feedback of their stay.
When looking to buy a real estate investment property to be rented in short term, be sure to ask for advice from a real estate agent, accountants, lawyers and any other person who can give you a professional advice.
Topics: Short Term Rentals, Invest in Real Estate, High CAP Rate, Where to invest, Opportunity, Real Estate, Buy in Miami, Miami Beach Short Term Rentals
About the author: Beatriz Rocha is a real estate professional affiliated with Coldwell Banker www.bearocha.com