You may love to have a second home but putting a crater in your wallet is the mortgage. To help defray the cost of ownership, a lot of second home owners turn to renting their property as a vacation rental. Do you know how you can price a vacation home without overcharging but make enough money so that the costs will be covered? Try doing your research.
There are other owners of similar sized homes in the area and you can try to find out what they are charging. You can scan the local papers, go online, or even ask a local real estate agent for a price range. eVaca.com is an example of one of the many vacation rental sites you can check out. There are advertisements from owners around the world in these types of sites as well as a list of the weekly rates for the properties.
It is also important to consider the time of the year you rent out a property. If renting a ski lodge in Vermont is what you are interested in, then instead of August, January will be your high time of the year. Renting the property during the off time of the year would mean that it's likely you won't be able to charge as much as if you were renting the property during its peak time.
The lengths that you want to rent your property for is another thing that you would also like to figure out. In July, a Florida property near the beach will go for top dollar for a week. But in January, that very same property may only attract the snowbirds who want to rent at a lower price and rent it out on a monthly basis. Questions like "is it worth the hassle" or "do I want to mess around with weekend or nightly rentals" are what you would have to answer.
You should try to determine how many weeks you need to rent your property in order to make a profit or at least pay the bills. Perhaps $12,000 a year in rental income is what you are required to make. You need to rent the property out for 12 weeks a year if you noticed, after you have looked at the other rentals, that a rate of maybe $1,000 a week seems more reasonable. But you might have to rent for a few more weeks at a lower rate to make up for "off peak" times of the year or if you do not get someone to fill every vacant period.
Make sure you won't forget to spend time in your own home vacation. Defeating the purpose of having that second home is owning the property and not being able to enjoy it.
There are other owners of similar sized homes in the area and you can try to find out what they are charging. You can scan the local papers, go online, or even ask a local real estate agent for a price range. eVaca.com is an example of one of the many vacation rental sites you can check out. There are advertisements from owners around the world in these types of sites as well as a list of the weekly rates for the properties.
It is also important to consider the time of the year you rent out a property. If renting a ski lodge in Vermont is what you are interested in, then instead of August, January will be your high time of the year. Renting the property during the off time of the year would mean that it's likely you won't be able to charge as much as if you were renting the property during its peak time.
The lengths that you want to rent your property for is another thing that you would also like to figure out. In July, a Florida property near the beach will go for top dollar for a week. But in January, that very same property may only attract the snowbirds who want to rent at a lower price and rent it out on a monthly basis. Questions like "is it worth the hassle" or "do I want to mess around with weekend or nightly rentals" are what you would have to answer.
You should try to determine how many weeks you need to rent your property in order to make a profit or at least pay the bills. Perhaps $12,000 a year in rental income is what you are required to make. You need to rent the property out for 12 weeks a year if you noticed, after you have looked at the other rentals, that a rate of maybe $1,000 a week seems more reasonable. But you might have to rent for a few more weeks at a lower rate to make up for "off peak" times of the year or if you do not get someone to fill every vacant period.
Make sure you won't forget to spend time in your own home vacation. Defeating the purpose of having that second home is owning the property and not being able to enjoy it.
