7 Tips for Renting a Vacation Home in Florida
7
Tips for Renting a Vacation Home in Florida
Renting a vacation home is a business, which means you’ll need the proper
business tools in place, from being able to accept credit cards as
payment to paying lodging taxes to getting the home cleaned quickly
and completely between guests.
If
you want the rental income, it's important to choose a home that can
be rented at the frequency you need to cover expenses. That means
both choosing a community that allows vacation rentals and then
making sure you're set up to take advantage of the rental potential,
from furnishing the unit to having a plan for advertising and
handling tenants. You need to know before you buy whether you will
rent the home when you're not using it.
1.
Choose the location carefully:
If
the main purpose is for you and your loved ones to gather together
and enjoy the house as a family, you’ll need it to be in an area
that is easily accessible for everyone, and that offers plenty of
activities for different age groups.
2.
Rent Before you Purchase:
Before
you lock yourself in, rent a place (more than once is best) in the
area you’re considering to be certain you’ll actually enjoy it.
Stay for at least two weeks to make sure you don’t grow bored on
extended stays.
Don’t
fall into the trap of purchasing a property that is a stretch to
afford. Buying a house with too high of monthly carrying costs causes
stress, and most people go on vacation to getaway from troubles. It
also means that if you eventually decide you want to hire someone to
manage the place, or care for the yard, there won’t be any wiggle
room in your budget to afford it.
4.
Be Realistic about How often you’ll use it:
When
they were young we bought a vacation home near our house. We used it
all the time. As the kids got older, though, we visited the house
less and less. Weekend sports games, friends sleeping over, and
church and school activities left too little time to get there.
5.
Understand the Tax Implications:
If
you are going to rent out the property, you will need to pay income
taxes on the rental income you receive. Your property taxes may also
run higher than what you pay now, either because the tax rate in the
vacation area is higher than where you live, or because its a second
home and not a primary residence. For example, the taxes on second homes in Florida are usually much higher than for primary residences.
6.
Make a Conservative Estimate of Rental Income:
Most
buyers tend to be overly optimistic about how often they’ll rent
out the place. Talk to a local vacation rental agency about how many
weeks of the year you can realistically expect demand.
7.
Don’t Get Caught Up in the Moment:
If
a friend, family member or another investor brings you an opportunity
to buy a vacation home, or to acquire land with aspirations of
building a grand home, don’t let yourself be easily persuaded.
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