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Tips to make a vacation home pay for itself.

By
Real Estate Agent with Coldwell Banker Colorado Rockies Real Estate

I own a condo at Copper Mountain, Colorado.  It is just a little one bedroom condo and I try to rent the heck out of it.  It is about 8 miles from my primary home, so I don't use it myself.  I have four major ski areas within 20 minutes of my house so there is really no need to stay there.  I do like the parking spot it gives me, but the condo was rented so much this year that I didn't get to use the parking place much either. 

I rent my condo myself using http://www.vrbo.com/ and http://www.homeaway.com/.  If you are not familiar with those websites, they allow an owner to post the property for rent as a vacation home (cost about $200-300 a year each website) and rent it to people looking to stay anywhere from a couple of days to a couple of weeks.  My condo is www.vrbo.com/17598  In my area, property managers charge 35% to 55% of the gross income to manage the condo.  In return they book it, clean it, and take care of it (more or less) and send you a check once a month.  My condo will generate about $20-25,000 this year, and perhaps 15% of that will go on expenses.  That means that it might even pay for itself this year!   When I had a property manager I netted about $8-10,000 a year.  If any of you would like to know how I do it, I am happy to share.  I have found that showing my clients how to bring in more money helps them make the decision to buy the property.  Otherwise they look at all the expenses and sometimes shy away.  It really is not that time consuming, but as with anything else generated from the internet, it requires quick response time to do really well.  The other thing that really helps me is a flat fee management company, that for $100 a month, handles the confirmations, keys, and arranges for the cleaning.  I pay for the cleaning separately.  I tell people I prefer to take a check as payment and I get it early enough so that it clears before the guests arrive.  I seldom have to take credit cards, but I can using Google check out. 

I could go on for pages with tips and tricks, and I have detailed some of them on my main blog about Summit County Real Estate.  I have written the first two in a planned series of how to go it alone and make more money.  I would like to hear your stories or those of your clients if you have a condo you rent short term or are in a vacation home market. 

Dena Stevens
Rocky Mountain Realty - Canon City, CO
Putting The Real Into Realtor Since 2004
My folks did this years ago in Mammoth Calif. They reserved one weekend a month for our own use, the rest of the time rented. It worked out great, so great I'd like to do it myself. Someday, someday.....
Apr 21, 2007 02:43 PM
Jennifer Steck
Rocky Mountain Homescapes, Keller Williams, Denver Colorado - Denver, CO
Denver Real Estate
Joanne- I had no idea that there were websites where you could rent it out yourself. What the property management companies charge is highway robbery! It is a great idea to manage it yourself, especially if you live close.
Apr 24, 2007 11:22 AM
Joanne Hanson
Coldwell Banker Colorado Rockies Real Estate - Frisco, CO
Summit County, Colorado Realtor
The internet makes it possible for almost anyone to do it, especially if you have a flat fee management company in your area.  I have heard of some areas in Florida that only charge about 15% for property managment, but here it is anywhere from 35 to 55%!  It has helped my sales to be aware of options for people who are looking for a property that will cash flow.  Without a lot of active participation by the owner, it won't happen, but most are willing if that is what it takes.  It always comes down to either time or money.  You have one or the other, but never both at the same time! 
Apr 24, 2007 04:04 PM