by Broderick Perkins
(1/14/2011) Erate Exclusive - Investment property owner optimism is generating a small windfall for vacationers this year.
A new study reveals eight in 10 vacation rental owners are so bullish on market opportunities this year, they are keeping rental rates the same or lowering them to reel in more renters.
HomeAway.com's "HomeAway Vacation Rental Marketplace Report" said 80 percent of rental owners anticipate rental business will be stronger than last year or about the same.
That's prompted an equal percentage of property owners to either lower rates or keep 2010 rental rates in place.
Already, according to the report, January to March bookings are the same or higher for 60 percent of vacation rental owners surveyed.
"It's clear an increasing number of travelers are considering vacation rentals as an alternative to hotels," says Brian Sharples, chief executive officer of HomeAway.
But the lowered rates, in part, prompted Budget Travel to name the Gulf Coast the top 2011 Budget Travel destination.
And some of the optimism is also due to waning perceptions that area beaches were awash in oil during the disaster. Media critics say the press failed to reveal most of the coast line was not fouled by oil.
Revealing more optimism for the area, HomeAway, a vacation rental portal of nearly a half million privately owned listings for travelers and property owners, reveals several Gulf Coast towns are among the top 10 areas with the largest increase in vacation rentals since last year.
The report also says travelers will benefit from planned upgrades this year as owners plow rental income back into their properties to make them more attractive to vacationers.
Fifty-nine percent of vacation rental owners are planning upgrades in 2011, including painting (41 percent); new bedding (29 percent); exterior work (23 percent) and new electronics (21 percent).
"For most vacation rental owners, it's about providing a great vacation experience for their renters," says Sharples.
But the return for their effort also means a more valuable investment.
Fourteen percent would buy in a ski or mountain destination; 9 percent would buy near a lake; and 6 percent would buy in a big city like New York, Dallas, Los Angeles or San Francisco.
The remaining owners would buy in a destination built around family attractions or a mid-sized city like Austin, New Orleans or Santa Fe.
However, for those looking to get the most bang for their property investment bucks in terms of rental income, markets where travelers most often look to vacation may be a better bet.
The destinations with the largest year-over-year percent increase in inquiries from travelers looking to rent vacation homes were:
McCall, ID, up 467 percent; New Orleans, LA, up 226 percent; Indio, CA (near Palm Springs), up 157 percent; Haiku, Maui, HI, up 143 percent; Chicago, IL, up 121 percent; Canyon Lake, TX (in Texas Hill Country), up 118 percent; Portland, OR, up 115 percent; Amelia Island, FL, up 113 percent; Haena, Kauai, HI — up 108 percent; and Wimberly, TX (in Texas Hill Country), up 108 percent.
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