Investing in property is always a risk, no matter how well-researched or experienced the agent is.
The pandemic demonstrated as much, as vacations were canceled en masse and real estate agents were left with functionally useless vacation properties back in 2020.
However, now that vaccinations are becoming widespread and restrictions are starting to lift, businesses, tourist traps, and cultural hotspots are also slowly beginning to reopen.
2022 will be the year vacations come back, even with the spreading of COVID variants, as vaccinated people slowly begin to take back some semblance of normalcy after almost two years of a quarantined, functionally limited state of existence.
With the real estate market currently booming, now is the time for savvy real estate agents and people looking to enter the field to get in on investing in vacation properties.
Investing now will allow you time to bid on and acquire a healthy portfolio of property, renovate and repaint those that need a little TLC, and get an acceptable number of postings across the various sites that host vacation rentals.
Whether you’re investing in rental properties in cities like Dallas or trying to capitalize on property near coastal areas like the beaches of Florida, now is the time to invest and invest big before the market settles.
However, for first-time investors who have never navigated the world of vacation rentals before, they may be uncertain as to what makes a property worth investing in.
If that describes you, read on for a list of things that make a property prime vacation rental real estate.
Location, Location, Location
One of the most important things when considering investing in vacation rental property is where it’s located.
You want to pick up properties that are close to areas tourists are likely to frequent, such as cultural centers, national landmarks, tourist-trap-like activities such as theme parks and other popular vacation destinations, and locations that are known for their natural beauty.
Stationing a vacation rental in these areas and listing it on websites like Airbnb will allow you to charge a reasonably hefty price per night, ensuring you get the most out of your investment, as well as attract a steady stream of potential customers looking to vacation in the area.
You’ll also want to consider how much investment a particular property may require to get it market-ready: almost no property you invest in will come to you customer-ready, and you may consider investing in properties that need TLC to be proper dwellings, as those will likely be heavily discounted.
Listen to this: there is a reason those properties are heavily discounted. You will likely have to spend an inordinate amount of money to discover and fix all of the problems that specific piece of property has, making the discount on the purchasing price meaningless.
Instead of choosing low-cost, high-risk properties that need an excessive investment of both labor and funds to get on the market, choose to invest your money in properties that will require mainly cosmetic renovation, if any, to get market-ready; you can always choose to add amenities to boost the value of your property later if you so choose.
Amenities Are Key
Speaking of said amenities, you may want to add some, if within your budget and able to be installed quickly, that will make your property more attractive to renters and ensure you get your first tenant in the doors quickly.
Amenities like walk-in closets, large showers and bathtubs, marble kitchen countertops and islands, or even a back porch and deck can prove attractive to people looking to stay in the area for an extended period.
Such amenities also provide a value proposition to consumers that makes your property more attractive than your average hotel room, reminding them of home and giving them more functionality out of their vacation property: never underestimate the value of having a fully-furnished kitchen to prepare your own meals in on vacation while on a budget, or the value of a long soak after a day spent hitting all the things on your to-do list.
Investing in property will always be a little risky: that’s the game, after all! But if you follow the tips listed above, you’ll find that your first investment in property will pay off, giving you a steady stream of passive income as people exercise their ability to go on vacation for the first time in a year and a half.