Short-Term Rentals: Things to Consider

by Jeffrey Poarch 04/21/2021

Photo by Arek Socha via Pixabay 

In a bid to afford homes in high-value areas, many homeowners turn to income from short-term rentals to cover a high mortgage payment. You can benefit from this option with some caveats:

  • Location really matters. A lot. You might advertise your home as near the coast when it’s really 20 miles inland and get a few bites. But eventually, the reviews catch up with you, and you lose out. Be honest about where your rental sits. Market what is available: access to public transportation, quiet parks, sports arenas, theme parks, etc. only if they truly are accessible.
  • Consider hosting rather than leaving your home to strangers. That means you stay on the property while they are there. You’re in control of who comes and goes. Your renters can’t sneak in a dozen of their buddies without paying for them.
  • Make sure your HOA and municipality allow it. Many homeowners associations explicitly forbid subletting or short-term rentals, so if that’s your plan, read those pesky covenants, conditions and restrictions (CCR’s) before you buy. Municipalities also have codes regarding hospitality properties. Many require licenses, permits or fees, and some require occupancy taxes on the nights guests rent your home.
  • Your homeowners’ insurance coverage may not protect you from damage or liability when you’re using your home as a business. Talk to your insurance agent before you post your home online and pay the extra premiums to make certain you’re covered.

Before you decide to turn your home into a short-term rental, know the rules and the risks or the rewards may not be worth the trouble. Your real estate professional is your best resource for discovering properties in your area suitable for a short-term rental, so make that phone call today.

About the Author
Author

Jeffrey Poarch

Hello, I’m Jeff Poarch. I have been a realtor since 1990 and carry on the tradition that my parents started in 1971 of providing friendly professional service to anyone buying or selling a home. I have sold waterfront and antique homes as well as starter homes and restaurants. I look forward to working with you on whatever property you have or have in mind.