by Broderick Perkins
(1/31/2010) - You've got a second home.
You've balked at renting it out when you aren't using it.
That's because you are afraid of tenants crashing your pad, your fear running a business alone, you don't look forward to the upkeep and a host of other "running your own business" myths are preventing you from earning the return you wanted when first purchased your second home.
You think the only way to own a second home is to, well, to foot the bill.
With property values as low as they've been in a decade, there's no time like the present to turn your second home into a vacation rental and let your investment really pay off.
A growing number of travelers are looking for bargains in the form of home-away-from-home accommodations.
"Conversion (vacation rental lookers becoming vacation rental bookers) improved by 16 percent over December 2009 and 31 percent over November 2010. This trend indicates that consumers are shifting from shopping to buying," said Steve Reich, Senior Vice President of Sales at LeisureLink, which tracks queries for vacation rentals, timeshare resorts and boutique hotels from online travel agencies, including Travelocity, Orbitz and Expedia, global distribution systems (GDSs) and LeisureLink's own ABetterStay.com.
"The combination of increased conversion and demand will result in revenue growth and guest acquisition opportunities. Regional changes have been particularly striking. Conversion in the Rockies ski regions is up, and we saw a dramatic improvement in conversion in the Gulf Coast region with an increase of 22 percent over the prior year," he added.
He also said, "Given the current trends and historical seasonal patterns, we forecast that early 2011 will see strong growth."
It's not the market. Myths are keeping you from turning your fears into cash on the barrel.
"If you've avoided this option in the past, know that renting your vacation home has never been easier or more convenient than it is now," says Christine Karpinski, director of the Owner Community for HomeAway.com, the nation's largest vacation rental portal of some 500,000 privately owned listings for travelers and property owners alike.
Karpinski, also author of "How to Rent Vacation Properties by Owner: The Complete Guide to Buy, Manage, Furnish, Rent, Maintain and Advertise Your Vacation Rental Investment" (Kinney Pollack Press, $26.00), says here's the real scoop on the myths that could be holding you back.
Renters will rock-and-roll your property. Tenants rarely trash properties. Instead they understand they are in a private home and typically treat it as such, with respect. You get to choose who stays in your property. Take the proper precautions when accepting renters, including requiring a security deposit.
You are on your own. You can use a host of online listing sites to market your property and if you live nearby you can clean it after each guest, but you also have the option to hire housekeeping help, on-site maintenance workers and a property manager. HomeAway.com and other rental portals typically offer a host of information to help you care for your property.
It is too difficult and costly to market your property. To the contrary, most people who sign on with a reputable online listing site find that guests come to them. HomeAway.com offers listings for between $169 and $550 a year. Other sites can be even cheaper. Also, give your guests a great experience and word of mouth advertising is free.
Property upkeep will be a nightmare. Property owners fear they will be frequently alerted in the middle of the night by a renter who is locked out or because a toilet or sink is clogged. Simply put a good plan in place and hire recommended maintenance and housekeeping people in the city or town where your property is located.
It will be too time consuming. The bulk of your time is spent up-front, setting up your rent-by-owner business. And, yes, there is banking and bookkeeping time. Beyond that, your work usually consists of a phone call or two and a couple of e-mails per guest to make sure everyone has the information they need.
You'll never get to enjoy your vacation home yourself. There is no requirement on how frequently you have to make your property available. Rent it out during peak season and enjoy it yourself during off-season. Or reserve a few weeks out of the year for your own use and rent it out the rest of the time.
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