Are Vacation Rentals A Viable Investment?
With most stocks and shares worth less than they were a few years ago, many people are putting their money in apartments and villas to let to holidaymakers. The hope is that rental income will finance the ongoing costs and will in time pay off the mortgage. Is this feasible?
If your property is in a popular area, especially one that attracts visitors all year rather than just the summer months; then the rental income should cover the costs of the mortgage and the maintenance of the property. So the basic business plan is viable. The next question is should you employ an agent to manage the property if you do not live nearby? The experience of many absentee owners in Spain suggests not.
There are reports of some managing agents 'forgetting' to inform the owners of lettings and keeping the income from lettings, and even letting their own families holiday free in villas. If you live hundreds of miles away in another country you are unlikely to know when your accommodation has been occupied, leaving you open to fraud.
The Internet has many websites where you can advertise your self catering apartment or villa and most sites will forward bookings and enquiries direct to you. An availability calendar that you control will ensure that you receive only bookings for weeks that are free. It does require some input and time from you but managing the bookings for your holiday accommodation is not difficult and will save you the not inconsiderable fees charged by agents.
It will make your life easier, and your business more successful, if you can make yourself available to field enquiries and bookings without undue delay. A telephone answering machine and emails are acceptable, but make sure you respond to messages the same day. There is a lot of competition out there and if a potential customer does not back from you quickly, he will go elsewhere. Although it is a chore, keep your availability calendar up to date. By so doing you will reduce the time wasting enquiries from people interested in booking your villa for a week when it is already let.
Of course the property has to be cleaned between lettings and, if you live hundreds of miles away, you cannot do this. However, there are enterprising folk who have set up businesses to clean villas and to be available to hand over keys to incoming holidaymakers.
However, it is sometimes just not possible to find the time to manage your self catering villa and you may have to employ an agent. There are good ones, so take the time to ask for references and speak to other owners to see if they receive a good and honest service. Go through the agent's agreement with a fine tooth comb and ensure there is no confusion about the service they will provide.
To prevent your villa being occupied without your knowledge consider paying the utility bills yourself, if possible with a monthly statement. If meter readings show electricity has been consumed then the property must have been occupied and you will be owed rent. Usually the knowledge that you are able to check on this will be a suitable deterrent.
If you treat your holiday villa like a business there is no reason why it should not be self-financing, and provide a foundation for a portfolio of holiday rental properties.
Article Source: http://www.search-raven.com
About the Author
Buying a self catering vacatiat apartment can be a viable investment if you choose an area that attracts visitors most of the year. Avoid agent's fees by handling bookings yourself and advertise your vacatiat accommodatiat at our website.
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by: ChrisLuck
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