Many vacation cabin owners have misconceptions about the ins and outs of renting their vacation homes. After all, spend just a few seconds thinking about it and you can come up with any number of disasters that could befall your beloved retreat when you rent it out to strangers.
The reality, though, is that once you get the hang of it, the pros of renting out your place can far outweigh the cons.
On the pro side of the ledger: The financial benefits of renting to vacationers can be a strong incentive. If you rent out your property only 17 weeks out of the year, the revenue you collect can pay your annual mortgage costs plus all other associated rental bills. Rent it more often than that, and you might just find yourself turning a tidy profit.
On the con side: Most of the worries prospective renters fret over will never come to pass – they’re largely myths based on fear and the occasional bad experience blown far out of proportion. Some of the myths are listed below, along with information that debunks them.
You have to use a property management company to book rentals.
False. While you definitely have the option of using a property management company to find renters and handle bookings, many cabin owners self-manage their places – also known as renting by owner. These homeowners choose to rent by owner for the increased control over who rents their homes and, of course, to save on the 30 to 50 percent commissions that many property managers charge.
Your home will be grossly damaged by your renters.
False. This is the number one fear of many vacation homeowners, but in reality it’s rare. If you take the time to properly screen your guests, extensive damage shouldn’t be a problem. (Keep on reading for a few helpful tips.)
You have to live nearby to look after your cabin.
False. Thousands of cabin rental owners rent their homes from a distance. The key is finding a reliable housekeeper or caretaker in the local area – or you can use the services of a property management company.
You’ll have to go door-to-door to find renters.
False. The Internet has made finding renters easier than ever. Vacation rental websites (like those listed below) have millions of visitors each year.
You shouldn’t tell your insurance company that you will be renting out your vacation home.
False. You should absolutely inform your insurance company that you will be renting out your property. Find out from your insurance company what additional coverage, if any, you will need. That way if you do run into a problem down the road you will know you are properly covered. Having the right insurance for your vacation rental can save you a lot of money if problems arise.
You won’t be able to use the property yourself.
You’ve caught on to the trend: False again. As a vacation rental owner, you have the option to rent your property only when you want to. So are you ready to put out the welcome mat for vacationers to rent your place? Once you start renting your cabin, you might wonder why you waited so long to take the plunge. The extra income will, of course, be an added bonus!
A Few Tips for Screening Potential Renters
Christine Karpinski has written several books on renting vacation homes and has three clever tips for finding the best renters for your property:
- Talk to each renter on the phone before taking his or her booking. It’s amazing how you’ll be able to discern quite a bit about your guests and their renting plans by asking the right questions during a short conversation.
- Be on the lookout for any red flags. If post-conversation you have a bad feeling in your gut about a potential renter, trust it. Pretty much every owner I’ve talked to who has had major damage done to their property had a bad feeling about the guest before he or she took the booking.
- Be wary of certain types of requests. A young adult trying to book your property for six people in mid-to-late March or early April is probably a college student on spring break. Likewise, an adult trying to book your place for 10 adults in June, but who will not be staying at the property, might be a parent booking the place for her son or daughter’s senior week. In both cases, the renters could be perfectly responsible young people, so don’t turn them down right away. Just do some research.
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Christine Hrib Karpinski is an author, speaker and vacation rental industry advisor.