As tourism worldwide increases and people look for more personal experiences, vacation rentals continue to boom. A city like Phoenix is especially attractive for a vacation rental, Turnkey notes, with its eclectic neighborhoods, gorgeous waterfront views and an array of attractions ranging from hiking Camelback Mountain to exploring the local art scene. If you’re eyeing Phoenix for a vacation rental investment, here’s what you need to know to get started.
It goes without saying that a waterfront property will be able to command higher rent, but it will also be almost twice as expensive as a home away from the water. Unless you have the capital to make a large investment, you may be better off compromising a bit on location and home style. A house with easy access to the beach, or within a reasonable walking distance, could be just as good for some travelers.
Consider a Manufactured Home
A manufactured home can be a great choice for a vacation property investment. You can enjoy substantially lower costs on your loan, maintenance and property taxes. Plus, manufactured homes in this day and age are built to higher standards, and the modern aesthetics and design can be quite desirable for those looking for a vacation rental. Also, it’s common for manufactured homes to be a part of a larger community with amenities like pools and golf courses, which stand to make your rental more attractive.
Consider Maintenance Costs
According to Afford Anything, a good rule of thumb is to set aside 1 percent of the home’s total value for repairs and maintenance every year. However, that’s for a regular home, not a vacation rental. Long periods of vacancy can exacerbate problems when there’s no one to take notice of issues, and guests can sometimes be careless. It may be worth creating an even larger repair fund, and to pay a property management company to keep an eye on things.
Put Some Thought Into The Decor
First of all, make sure all walls and floors are looking fresh. Choose neutral, relaxing colors, and then bring a touch of character using accent furniture. This can be an attractive hallway table or an end table with multiple shelves. Don’t bother with antique or expensive furnishings – practical and sturdy items are best.
Go The Extra Mile On Amenities
It’s the little extra touches that make the biggest difference. GuestReady recommends stocking the pantry with coffee, tea, and snacks. For the bathroom, make your guests feel like they are at a hotel with travel-sized toiletries and items like extra toothbrushes and razors. If you want to go above and beyond, consider putting together a complimentary welcome basket that includes city guides, flowers, a bottle of bubbly, and anything else that you think the guests will like.
Put Effort Into Your Listings
Your listing is your main form of advertising, and it should wow potential guests. The description should be detailed, friendly, and vivid, outlining the reasons why this is the best place to stay in Phoenix. The photos are perhaps the most important part, which is why you should make sure they are the highest quality possible. Use natural lighting, think about your composition, and use a great camera. If you don’t have one, hire a professional.
Build An Online Presence
It’s not enough to just post your vacation rental on a few listings websites. You need to have your own branded online presence. This isn’t as hard as it seems.
Anyone can build a great-looking website these days with a web builder– Squarespace is particularly well-rated for aesthetic appeal and ease of use. You should also have active social media feeds for your property, especially Instagram and Facebook.
Be Smart About Taxes
How your vacation rental is defined for tax purposes depends on how often you rent it and how often you use it personally.
- If you rent it for more than 14 days, you are a landlord. You have to report rental income and can claim expenses.
- If you rent it for less than 14 days, you don’t declare anything but can’t claim expenses.
- If you live there for more than 14 days, you can deduct expenses but can’t deduct losses.
- If you live there for less than 14 days, it is a business. You have to report income, can claim expenses, and can deduct losses up to $25,000.
There’s no doubt that setting up a vacation rental is a lot of work. Buying a house and putting up a quick listing isn’t going to cut it in today’s competitive market. However, if you are willing to put in the effort, you can make a stable and sustained profit from your Phoenix vacation rental – and get a first-rate vacation home for yourself in the process.
Looking to buy a manufactured home for your vacation rental investment? Turn to the experts at 365 Realty Deals to find the perfect home for your needs. Call today for more information! 480-648-5814