A long-term tenant moves out and you’ve got a vacancy. Of course, a short vacancy is necessary to clean and repair property for new tenants to move in. But what happens when that vacancy stretches from one or two weeks to longer?
Empty rentals lose money. You’ve got a mortgage to pay and a property to maintain. While you wait for a qualified tenant to apply and move in, you need income. Could AirBnB be the answer?
The Reality of Short-Term Rentals
While extra cash from AirBnB may sound like a good idea, there are a few things you’re going to need to consider before opening your property up for short-term rentals.
Insurance coverage: Check with your insurance provider to make sure your current policy covers short-term rentals. If not, you’ll need an additional policy to cover liability, property damage, and bodily injury for your guests and others who may be in the property.
Cleaning costs: A one-time rental may not require much effort but if you schedule several rentals back to back, you’ll need to keep the property clean and maintained between visits. You’ll either need to go in and clean everything yourself (costing you time) or pay a professional service to do it (costing you money).
Furnishings and amenities: Long-term tenants usually move in with furniture and all the things they need to live in their home. Towels, sheets, plates, cups, cutlery, and more are all their responsibility, too. For short-term rentals, you need to make sure everything is provided to make your property more attractive to potential renters.
Potential damage and other problems: Unlike long-term renters who go through a background check, you’ll know almost nothing about your short-term renters. Since you’ll be functioning more as a hotel, you’ll have little control over who stays in your home. Are you ready to take on the costs of any potential damage or even violations of laws that may occur from your short-term renters?
Local ordinances: Before you post your property on AirBnB, make sure you have the legal ability to provide short-term rentals. In Destin, for example, all short term rentals must be registered through an application process.
Is AirBnB Worth the Money?
The question to ask yourself before adding your rental property to AirBnB is simple but important: will this be worth the money? Not only should you consider the money you’ll make, but also the money you’ll spend. Furnishing the property, keeping it clean, and repairing any damages between renters could eat into your profits from the start.
Plus, AirBnB isn’t like other rental sites where you can add your property and forget it. You’ll need to spend time on the website updating your listing frequently so that it continues to show up in search results for vacationers. There’s no set it and forget it with AirBnB. And just like other rental listings, you’ll need pictures and a good description in order to attract renters.
Don’t forget that you’ll also have potential long-term tenants who want to view the property and possibly rent it. With short-term renters, you’ll limit your ability to market and show the property. This could delay finding a renter. Add in the costs to clean and repair after your short-term renters leave, and AirBnB may not be worth all the time, effort, and money.
Avoid vacancies in the first place by working with a professional property management company who knows you don’t succeed without tenants. At ERA American Real Estate, our priority is your property: finding good tenants, keeping them, and minimizing vacancies so you don’t have to wonder when your property will produce income again. If you’d rather have help managing your properties instead of figuring out AirBnB, give us a call today.