As the popularity of short-term rentals grows, more and more people are looking to get in on the action. But not all short-term rental investments are created equal. There are a few key things you should look for before you put your money down on a short-term rental property. Keep reading for our top 6 tips for short-term rental investment success.
- Location, Location, Location The first thing you should look for in a short-term rental investment is a prime location. Ideally, your rental property should be located in a popular vacation destination, near major attractions and amenities, and in a safe neighborhood. A central location will make it easy for guests to get around and make the most of their vacation.
- The Right Property Type Not all properties are suitable for short-term rentals (or even allow it). Look for a property type that is in high demand. Multi-unit properties also offer the added bonus of generating income from multiple rental units.
- A Turnkey Property Investing in a turnkey property—one that is ready to rent with no additional work required—is always a good idea. Not only will you avoid costly renovations, but you’ll also be able to start generating income right away.
- Positive Cash Flow Before you invest in any rental property, be sure to do your homework and calculate the projected cash flow. You want to be sure that the rent you’re charging will cover all of your expenses, including the mortgage, utilities, insurance, and property management fees (if applicable), with some money left over.
- Good Reviews When you’re considering a particular rental property, take some time to read online reviews from past guests. Pay attention to both the positive and negative reviews to get a well-rounded idea of what guests think of the property. Doing your due diligence upfront can save you a lot of headaches down the road.
- A Professional Property Manager If you don’t live near your rental property or if you simply don’t have the time or energy to deal with the day-to-day tasks involved in being a landlord, it’s worth considering hiring a professional property manager. A good property manager will handle everything from marketing your rental and screening guests to maintaining the property and dealing with any issues that may arise .
Short-term rentals can be a great way to generate income, but not all investment properties are created equal. When you’re on the hunt for the perfect short-term rental investment, be sure to keep an eye out for these six things: location, type of property, turnkey status, positive cash flow, good reviews, and professional property management. Do your research upfront and you’ll be on your way to reaping the rewards of successful short-term rental investing.
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