Welcome to Part Two of our series on investing in short-term rentals. Joining me again is Rees , a client of ours who has recently used short-term rentals in her investing strategy.
In the first part of this series, Rees explained the return she received on this investment. Initially, returns were in the single digits. From a percentage standpoint, though, short-term rentals produced a 50% higher return than long-term rentals. Her family also decided to outsource the management of these properties, so they hired a company who handles the management of similar internal units, and that 50% was after that management company’s fees.
When it comes to managing the property itself, her workload has decreased because their management company, like most management companies, has a handyman on call for maintenance issues within short-term properties. Many people wonder how much time they’ll have to devote to managing residential rental property, and the answer is usually less than you think.
Rees has two main points of advice for anyone thinking about buying an investment property. The first is to leave a little bit of a buffer from a dollar standpoint, especially with short-term rentals. This is because there is a little bit of upfront capital investment required, and issues can arise that you’ll need money set aside for.
It’s also critical to have a good team in place. Rees had a great real estate attorney and a home inspector working for her, and they advised her against buying a different property that would’ve caused her a lot of headaches.
We want to thank Rees for joining us today to help us explore the topic of short-term rentals. If you have any more questions about investing in short-term rentals, don’t hesitate to reach out to us. We’d be happy to help you.