As a landlord or property investor, you know that one of your goals is to reduce your vacancy rate and keep your units occupied. After all, if they are sitting there empty, they surely are not bringing in any money, are they? That’s why when a property has been vacant for any length of time, it may make you want to want jump at every opportunity to get some cash flowing again.
Here’s the thing – short-term leases, vacation rentals, or month-to-month rentals may sound better than no rental at all. But, we’ve got 7 reasons why you should invest in long-term rentals. Check them out.
People will always need a place to live so there will always be renters. There is no need to put yourself through the hassle of short leases. Besides, research is starting to reflect an increase in the number of renters — so the rental market is high in 2021.
Tenants that are in and out quickly will mean more work for you. Cleaning and maintenance between tenants/guests along with paperwork, tenant screenings, and so forth. If you decided to invest in rental property as a means of securing a form of passive income, short-term rentals and such may not make sense.
Speaking of income – with a long-term lease, you have consistent income over, at least, a 12-month period. You will get your tenant screened, the lease signed, and then collect the rent. Unless, of course, maintenance or repairs are needed. Regardless, it is a monthly fee you can rely on.
Believe it or not, the vacancy rates are higher for short-term and vacation rentals – by a lot. If your property is not rented now, you may feel as though your rate is going to go up. But, realistically, once your unit is tenant-occupied with a long-term lease, you will not have to worry about that rate again for at least 12 months or so.
With short-term rentals, you will be expected to furnish the property with nearly everything one may need while living there. This includes furniture, televisions, linens, small appliances, dishes, pots and pans, and so on. With each new tenant, you will need to make sure everything is in presentable shape and working order.
If not, it will need to be replaced. This could get expensive. Not to mention the hassle of having to keep it looking great for the next guest. Remember, the expectations of your short-term guests will be high.
With long term rentals, tenants will bring their own furniture and their own dishes. You provide the bare rental and they will move in with their belongings. This puts less strain on you. Sure, you will have to check the property when the lease is up and there may be some minor wear and tear, but nothing like you would see with vacation rentals.
Even if you don’t find the most high-quality tenants out there, long term tenants tend to take care of their homes better than a guest does at a vacation rental. They live there and they want to be proud of where they reside. Any issues, they will call you or take care of the issues themselves. Short-term summer renters? Not so much.
The internet is a wonderful tool. But, for those trying to please guests and short-term tenants at vacation properties, the internet can quickly turn into a nightmare. Some companies hire a person or department for the sole purpose of keeping the peace online because one or two bad reviews can really put a damper on your business.
Sadly, the reviews may not even be accurate or they could be the result of an over-demanding tenant. Even so, the world will hear about it — and you will be left to pick up the pieces or try to make things right.
Long term rentals have long term tenants. They aren’t usually leaving reviews of their landlord online so that’s one less thing for you to worry about.
If you have read these 7 reasons to invest in long term rentals and you are still focused on short-term vacation rentals, that’s ok. We each have our own interests, investment strategy, and goals. It works well for many people – and it may very well be rewarding for you, too.
If you ever find yourself overwhelmed with the process, though, just know property managers may be able to help you with short-term leases. Not all provide this service, but it is worth looking into.
If you find that you are struggling to get your long term rentals occupied, consider changing up a few things. Take a look at your requested rental rate. Is it reasonable? Does it fit the area? Check around at comparable rentals and make sure you aren’t coming in too high.
Next, switch up your advertising and property marketing methods a little bit. Maybe you are not reaching the right audience? Maybe you aren’t even having those seeking rentals see your listing? Change the wording of your listing, throw in some fresh pics. Sometimes giving it a little online makeover may help.
Finally, seek the professionals. Hiring a property manager may not be something you have considered, but when it comes to getting properties rented, well, that’s what they do. The best property manager in the greater Phoenix area – Real Property Management Evolve – knows that to successfully rent properties, you have to have the right strategy. And, when you’ve spent your life honing those skills, then you know how to keep that vacancy rate down — and long term rental agreements signed.