By: Cody McBride
Vacation rentals are a hot commodity these days. In fact, the industry tends to thrive despite the overall state of the economy, and more vacationers are choosing short-term rentals over traditional options like booking a hotel or bed-and-breakfast.
Converting your home into an investment property could be an excellent way to boost your income and diversify your portfolio. But you must approach it with a strategy if you hope to make the most from your vacation rental.
Start a Business
It’s essential to think of your vacation rental as a business if you hope to protect yourself from liability and make a profit. One of the first steps will be to choose a business structure. Choosing a structure will limit your personal liability and yield tax advantages. You can work with a formation service to help you with this process and start an LLC in Arizona.
Deep Clean the Space
You may need to make many upgrades to your home before renting it out. But the first thing you should do is declutter and deep clean every room and space. Purge your belongings and remove any personal or family items so that your guests can feel at home during their stay and not like they are staying in someone else’s home.
You will also want to clean every surface of every room from top to bottom and tend to the exterior of your property as well. Consider hiring a cleaning service for the initial and/or recurring cleaning as well as a lawn maintenance company to spruce up the landscaping. If you’re planning on renting out your home furnished, make sure all the furniture is in good condition.
Stage the Property
Your next step will be to evaluate the property's interior design to figure out how you can stage it to attract guests. Your guests will want to stay in a clean, secure, and attractive vacation rental. And you might benefit from hiring an interior designer to stage your home. Or, you can search the web for inspiration and handle the upgrades on your own.
It’s hard to go wrong with neutral colors and decor because it appeals to a wide range of tastes. And keep in mind that you will want the home to feel as spacious as possible, which may require you to remove bulky furniture, install new storage solutions, and make other changes that can open up the space.
Incorporate Luxury
If you are investing time, energy, and money into purchasing a property and preparing it for guests (or even converting your primary residence), spend a little extra on amenities that will attract guests. Go for quality linens, shower hardware and faucets, and luxury toiletry products.
Don’t Forget the Exterior
Lastly, your property needs major curb appeal if you hope to keep it booked throughout the year. Besides shaping up the landscaping, look at the house itself to see if there are any changes that need to be made. Maybe the siding or brick could use a fresh coat of paint, or perhaps you need to repair the walkways or steps. If the windows of the house have seen better days, consider installing new vinyl ones to boost appeal and reduce your energy bill.
If you are looking to take advantage of the hot vacation rental market, it’s essential to learn as much as you can about investment properties and strategize each step. Following the tips above will help position you for long-term success. But there is much more to real estate investing, so make sure you keep studying and finding ways to maximize profits.
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