Investing in real estate can have huge returns, especially if you get the property and the timing right. However, if you've never bought a vacation property before, there are some specific things you can look for in a vacation property that will add to its success as potential income for you. Here are some considerations to keep in mind.
It goes almost without saying that location should be the first thing on your mind. Look through the area where you're hoping to buy. Spend several vacations there yourself at different times of the year to get a feel for the place. Where do tourists and vacationers like to spend their time?
If you're hoping to buy a vacation condo in Utah, you'll want to consider the distance from ski resorts and outdoor attractions, but you'll also want people to come during "off season" times, where they might spend more time shopping. When looking for a place in Florida, you'll want to consider beach access and accessibility to major theme parks.
If your budget prevents you buying right where the action is, you might consider looking for alternative attractions, such as a bustling night life, access to city parks, and access to public transit.
Is the property part of a community that offers things like work-out facilities, outdoor play spaces, dog parks, and shared swimming pools? These amenities only add to the appeal of a vacation condo. People like to stay in places where they can still enjoy their regular lifestyle (daily workouts, walking the dog, etc.). As a bonus, these types of communities usually offer HOA services, so you won't have to worry as much about basic maintenance as a landlord.
If you're looking for a more individual property, however, you'll have to do what you can to provide amenities. Consider planning the space to accommodate families, with plenty of pull-out couches and baby cots. Look for a larger kitchen that can be stocked with basic condiments and spices. Is there a family room with a large TV for movies and video games for people to enjoy? Also consider whether of not their is a fenced back yard so kids can go out to play; providing a swing set can only help improve your ratings on sites like Airbnb and HomeAway.
3. Unique features
Vacationers like their trips to be an experience different from everyday life. Unique features help to attract new customers, especially young people who appreciate the quirks of a different space. For example, if you buy a condo that was once an old factory warehouse, that's a bonus that will help the condo stay rented. Take time to look for:
- Places with unique architecture: Old brick, cool windows, arches, beams, and even odd colors are appealing to millennial renters.
- Older restored buildings: Old Craftsman homes or Colonial row houses offer the charm of yesteryear; just don't forget to add the modern features that people expect from a vacation rental.
- Forgotten spaces; Attics, warehouse basements, old courtyards, churches, and similar "forgotten" areas in historic parts of downtown are ideal for finishing into a unique apartment.
Many renters are happy with studio accommodations, so larger spaces can even be divided into two or three small apartments to maximize income potential.
4. Consider the neighbors
Some things can annoy your renters, and the reviews that feature annoyances can drive other people away. For example, if your rental is on a street with a lot of dogs, some people might be bothered by all the barking. Streets with lots of traffic can be too loud for people looking to relax. Partying college students or a loud pub below the apartment can also drive people away. Knowing your target demographic can help you decide which things will drive vacationers crazy.
Work with a company like Poole & Associates Investments, Inc to find a vacation condo you'll love to rent.