If you’re a homeowner ready to make a move, you may be thinking about using your current house as a short-term rental property instead of selling it. A short-term rental is typically offered as an alternative to a hotel, and they are an investment that’s gained popularity in recent years. According to a Harris Poll survey, 28% of homeowners have considered using a rental service to temporarily rent out their home for additional income.
Owning a short-term rental can be a tempting idea, but you may find the reality of being responsible for one difficult to take on. Here are some of the challenges you could face if you rent out your house instead of selling.
A Short-Term Rental Comes with Responsibilities
Successfully owning and renting a house takes work. Think through your ability to make that commitment, especially if you plan to use a platform that advertises your rental listing. Most of them have specific requirements hosts have to meet, and it takes a lot of work.
“Managing a rental property can be time-consuming and challenging. Are you handy and able to make some repairs yourself? If not, do you have a network of affordable contractors you can reach out to in a pinch? Consider whether you want to take on the added responsibility of being a landlord, which means screening tenants and fielding issues or paying for a third party to take care of things instead.” (Bankrate article)
Not only is there the upfront time and cost of owning a short-term rental, but there are also risks that could come up for you down the road. Risks of hosting include renting your place to rude guests, theft or damaged property, complaints from neighbors and potential regulatory violations depending on your location. There’s a lot to consider before taking the leap and converting your house into a short-term rental. If you aren’t ready for the work it takes, it could be wiser to sell instead.
Your House May Not Be Ideal for Your Rental Goals
Not every house ends up being a profitable short-term rental either. One of the biggest factors is where your home is located. The less likely your neighborhood is to be a travel destination, the fewer requests you should expect from potential renters. And, that will impact your bottom line.
It’s smart to do your homework and learn how much rentals in your area go for. How much business they get throughout the year. How does this compare to your goals?
Bottom Line
Converting your home into a short-term rental isn’t a decision you should make without doing your research. To decide if selling your house is a better alternative, let’s get together.
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