Which is better: short or long?

By
Real Estate Broker/Owner with Robin Rogers, Silverbridge Realty, San Antonio, Texas 398351

This river view could be yours - or your tenant'sIf you are considering buying a vacation home, for instance on Canyon Lake, Lake McQueeney, or the Guadalupe River in the beautiful Texas Hill Country, you may be wondering about renting it out when you're not using it. The income could offset some of your costs and make your second home more of an investment.

The question is whether to rent it out short- or long-term. There are some big differences between the two scenarios.

Drawing on years of experience owning and managing rental properties, and leasing them both short- and long-term, I've come up with some things for you to think about.

Short term:

Pros – More profit (maybe!)

- Short-term rentals can generate two or even three times as much income per day as long-term

- You have more flexibility to visit your second home any time of the year

Cons - More hassle

- Your neighborhood association might have restrictions on lease terms

- Your property manager charges a higher fee because they do more work

- You need to advertise on various rental websites, paying more for better ads to beat the competition

- Repairs and replacement of furnishings and home must be made immediately

- Home must be in perfect condition or guests might complain, leave bad reviews, or ask for refunds

- You must keep a supply of things like toilet paper, clean linens, and soap

- You need to keep utilities on year-round and provide yard mowing – and watering - services

- You need to clean the property after every guest checks out

- You may have to accept credit cards for bookings

Long term:

Pros – Less work

- Tenants live in “their” home instead of treating it as a hotel room

- Fewer complaints; tenants will accept the property as is

- Tenants pay for utilities, yard maintenance, cleaning

- Your property manager can advertise your home for rent on the MLS (for a fee)

- You can charge a month’s rent for security deposit to cover any damage more than wear and tear

Cons - Less profit

- Your furnishings may need to be put in storage if tenants have their own

- You will probably need to accept pets (although kids can cause as much damage as pets!)

- You can only stay in your second home during the months of the year when it's not rented

water ski on Canyon Lake or Lake McQueeney, Texas

 

There are also tax implications to discuss with your tax adviser. Then you can decide which of these scenarios would work best for you. You might start out with long-term leases, and then switch to shorter ones as you gradually get more time to visit your second home.

Who knows? It could end up being your retirement home.

 

Posted by

 

Robin Rogers, REALTOR, Broker-owner, TRC, MRP, CRS

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Comments (2)

Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Now here is an agent that is inviting and easy to talk with...call this pro now

Feb 21, 2015 11:57 PM
Debbie Walsh
Shahar Management - Middletown, NY
Hudson Valley NY Real Estate 845.283-3036

Great job with the post Robin!  Alot of things to think about - you show just how knowledgeable you are!

Mar 05, 2015 03:07 AM