Four key factors to consider when investing in vacation rental property

A few years ago (OK maybe more than a few), buying a vacation rental property seemed like a dream to many. Mortgage rates were high, properties were expensive, and available inventory in prime locations was relatively small.

But this isn’t a few years ago. Today, making your dream of owning vacation rental property is within reach, thanks to more vacation properties for sale, dropping prices and lower interest rates.  If you’re in the market to become a new landlord of a short-term rental, the key is to find the perfect property to make those dreams come true. Here’s what you want to keep in mind:

1 Location, location, location. Everyone envisions a gorgeous villa on the beach with spectacular views of the ocean. While oceanfront vacation rentals are among the most lucrative, there are plenty of other locations that can bring in rental revenue year-round. Think about what attractions are around you, think outside the box. Are there excellent shopping opportunities like huge outlet centers that draw crowds from out of town. Are you near a large college with a huge following of fans that are perpetually in need of a place to stay for games, graduation and other special events?  What about great golf courses or nearby amusement parks? The more attractions that are within an easy drive of your rental property, the better chance you have of keeping the place booked.

2

 Your budget. Be realistic about how much you want to spend on a vacation rental property, including what you’ll need to spend to furnish the place for your guests.

3.The size of property you need. How many people/couples/families are you hoping will be using the property at any given time?  Though not necessary, having a bathroom for each bedroom is ideal.

4Your future plans. How often do you plan to stay at the property? Do you hope to move there one day? If so, you want to select a place that suits your needs as well, though that should be secondary if your plans don’t include moving in for several years. You never know what might change by then. 

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