The vacation rental business has gotten tougher in recent years. Cities are tightening short-term rental restrictions and housing prices are rising around the country. Yet there's still money to be made investing in vacation rentals.
That's especially true in the wake of the coronavirus pandemic as families are eager to travel but not quite ready to jet-set abroad. Experts predict high demand for domestic travel in 2021, particularly to rural, coastal, and outdoorsy locales.
If you’re ready to break into real estate investing, these tips will help you make a strong entry into the vacation rental business in 2021.
2021 Vacation Rental Industry Trends
The coronavirus pandemic turned the travel industry upside down and vacation rentals were no exception. As the industry bounces back, it looks a bit different than in 2019.
● Locations that let travelers spread out will come out ahead of urban destinations in 2021. The Poconos, Hot Springs, Arkansas, Cape Coral, Florida, and Pigeon Forge, Tennessee rank among the top places to invest.
● Small towns don't necessarily come with small prices, however. Home prices in small towns are rising, too. Luckily, that represents an opportunity for real estate investors.
● Americans crave meaningful travel in 2021, Millionacres explains. That means longer stays, larger spaces, and a willingness to pay more for home-like amenities and curated local experiences.
● Investors will need strong credit and hefty down payments to secure a rental property mortgage this year. However, those who qualify benefit from low-interest rates.|
How to Maximize Vacation Rental Income
Now you understand where the market is headed, but how can investors capitalize on today's vacation rental opportunities? Here's how to invest profitably in the vacation rental market.
● Like all real estate investments, vacation rental profitability is all about location. However, travelers want more than a great destination. Spacious layouts, high-tech connectivity, and a focus on cleanliness and safety will be paramount for travelers.
● Be wary of overpaying for a vacation rental. It doesn't matter how great a property looks if you can't rent it for a profit. Hire a financial consultant to run the numbers and determine a property's investment value before you buy.
● Long-term guests will pay extra for amenities like on-site laundry, a stocked kitchen, and private parking. Kid- and pet-friendly spaces will also be in high demand among this year's travelers.
● With longer stays come bigger risks for property owners, making it more important than ever to screen vacation rental guests. Guest vetting reveals whether a renter has evictions, property damage claims, or other red flags on their rental history.
Effective Vacation Rental Marketing
2021 will also be a year of intense competition in the vacation rental industry. In addition to offering the amenities that travelers want most, what more can investors do to attract tenants?
● Airbnb continues to dominate the vacation rental marketplace. However, today's hosts prefer to list on multiple platforms for greater reach. Vacation rental channel managers make it convenient to manage listings across several platforms.
● The most effective rental listings use high-quality photos, evocative descriptions, and clear details regarding rules and amenities.
● Investors should also build their own website to market a vacation rental, using keyword content and search engine optimization to drive traffic. Websites generate leads and are a fee-free option for booking vacation rental stays.
Order A Background Check On Long-Term Guests
Breaking into the vacation rental market in 2021 won't be easy, but for those who pull it off, there's never been a better time to invest. However, investing in vacation rentals isn't risk-free, especially when marketing to longer-term guests. Partner with Global Background Screening for tenant screening services and you'll rest assured that each and every guest treats your property like home.