Short Term Rentals: Reasons to Invest in Vacation Rental Properties

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It is no secret that investing in real estate has been a go-to strategy for investors looking to make impressive returns. One of the best ways to generate a lucrative monthly cash flow and diversify your investment portfolio is through short-term vacation rentals. In addition, if you are new to real estate investing, purchasing a vacation rental is a great place to start your real estate journey. 

What Are Short-Term Rental Properties?

Short-term rental properties are homes that are rented out for no more than 30 days at a time. The most common short-term rental property is a vacation home. While these properties may take more hands-on maintenance and upkeep than traditional long-term rentals, they can provide more lucrative returns if managed correctly. So whether you are just getting into real estate or are looking for new investments to add to your portfolio, here are a few of the top reasons to invest in short term vacation rental properties.

Short-Term Rentals Make More Money Than Long Term Rentals

If managed correctly, vacation rental owners can generate a much larger cash flow than they can for traditional long-term rentals. For example, while the average monthly rent is just over $1100 while short-term vacation rentals can cost anywhere from $100-$500 per night. However, it is important to note that there are plenty of aspects vacation rental owners need to consider. For instance, wear and tear, vacancy rates, the market, and other factors can affect the success of any rental property.

More People Are Turning Towards Rental Homes Than Hotels

Thanks to sites like Airbnb, more and more travels are opting to stay in a short-term vacation rental than pay for a hotel. Not only are vacation rentals more comfortable for vacationers, but they offer a freedom that hotels can’t provide. For example, travelers would much rather have access to a kitchen and living room and not have to deal with other travelers. As a vacation rental owner, you will be providing a unique personal experience to travelers from all around the world.

Short Term Rentals Are Easy To Find

People travel to all different places for all different reasons for anything from business meetings, weeklong vacations, and weekend getaways. They travel to cities, small towns, lake communities, and more. Therefore, contrary to belief, there are far more options for vacation rentals than beach house mansions. Regardless of your budget, you can easily find an affordable vacation rental in various sizes, shapes, and locations. From tiny houses to city apartments and country cottages, your options are limitless.

Diversify Your Investment Portfolio

The best way to live a life of financial freedom is to have multiple streams of revenue. Even if you have other traditional real estate investments, short-term rentals can diversify your portfolio and break you into new markets and lead to new lucrative opportunities. In addition, the money you make from your short-term rentals can help cover the mortgage for your other real estate properties and, in doing so, optimize your profits.

Tax Advantages

One of the best things about owning rental properties is the tax advantages that come with it. Since you are renting your vacation home out to other people, the government sees it as a business. On top of deducting mortgage interest from your rental properties, you can deduct business expenses related to your rental.

You’ll Have A Vacation Home To Enjoy

Another great thing about short-term vacation rentals is that you are not tied down with your tenants for long term contracts. Since renters only occupy your home for a few weeks at the most, you have plenty of flexibility to do what you want with your rental. For example, you could block two weeks out of the year to have a free vacation home for you and your family to enjoy.

Is A Short-Term Vacation Rental Right For You?

If, any of these reasons caught your eye, consider investing in a vacation rental today. From healthy returns to flexibility, and more you will not be disappointed in your decision.