The advantages and disadvantages of seasonal rental

Vacation rentals can be rewarding both personally and financially. However, it is important to be well prepared to find the right property and manage it properly.


Is seasonal rental profitable?

With the right property and the right strategy, you can generate a steady stream of income and charge higher room rates than traditional long-term rentals.

The potential to turn a property into a large-scale, profitable business does exist. If you know where to buy and how to promote it to the right target audience, you can take advantage of all the benefits that vacation rental property management can offer.

The advantages of seasonal rental

While managing a vacation rental property can be a rather pleasant experience if you listen to property managers, it also has its drawbacks that you should definitely consider. So, if you are considering investing in a property, here are the main pros and cons you should consider before deciding.

More profitable than traditional real estate investment

Compared to long-term rental investment and traditional real estate investment, vacation rentals can generate more income. Not only are travelers willing to pay more for a vacation rental than for a long-term rental, but as a host, you can also adjust your prices throughout the year.

You can take advantage of the high season as well as special events such as festivals, trade shows and others to increase your prices.

You also have the option of offering additional services for a fee: upsell. From transportation to laundry services, there are many different services that your travelers will be happy to pay extra for.

More control over your property than with a long-term lease

By opting for short-term rentals, you will have more control over the condition of your property, its availability and your rates. Since you have not signed a long-term lease, it is much easier to block out a weekend for maintenance, upgrade your equipment or simply increase the rate during weekends and special events.

Also, while more rotations do mean more work, it gives you the opportunity to inspect and maintain your accommodation more regularly.

The disadvantages of seasonal rental

Property management is not a walk in the park

Holiday rentals require special attention at all times. For each guest, you must ensure that the property is clean and in working order. Also, because of the higher risk of wear and tear, your accommodation may require more maintenance than a long-term rental property.

You may have to deal with difficult travelers

Although OTAs put in place certain measures to help you screen your potential travelers, such as ID verification, you may be faced with damage or nuisance to your neighborhood.

To avoid the potential inconvenience of unwanted travelers, it is essential to request a deposit to protect you in the event of damage to property or non-compliance with the rules of tenancy in your property.

Rental income can be irregular

As mentioned earlier, short-term rentals are generally more profitable than long-term rentals, but keep your occupancy rate high is much more difficult and your income will be much lower. Seasonal rentals are also more often sensitive to seasonality.

Therefore, you need to study the impact of seasonality on your business before buying a property in a specific area. You need to know when the peak season is so that you can make the most of that time.

The expenses will be higher than in the case of a traditional rental.

Loans for real estate investments usually have higher interest rates than regular loans. They also require larger down payments than your primary residence. So you'll have to pay more to finance a short-term rental.

In addition, because the property must be furnished and look neat, the owner of a short-term rental has other additional expenses.

In a nutshell

If seasonal rental can seem more and more attractive since the emergence of Airbnb and the services opening the door to individuals, it remains an investment and to carry out this activity well is a real profession.

It is an exciting and multifaceted activity that requires special attention!

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