Even though hotels are still the primary accommodation for travelers in the United States, vacation rentals still stand out among the crowd. In 2023, travelers spent 207 million nights in vacation rentals. The industry continues to grow each year, while the supply of hotel rooms has diminished.
As a property owner, it makes sense that you'd want to get in on the action. However, it's important that you charge the right amount to make the most profit.
Here's how to discover your rental estimate and what can affect it.
Use a Rental Income Calculator
One of the first things you'll want to use to get a vacation rental estimate is a rental income calculator. You can find these calculators online, and they take various factors into account when determining how much property owners could earn from renting.
Some of the factors include property size, location, and market demand. When it comes to short-term leases, the time you rent it out will also make a significant impact.
Using a rental income calculator can help property owners understand their potential income and how best to spend their money. You can adjust variables such as the nightly rental rate and even management costs.
Get a Property Rental Evaluation
A property owner can benefit greatly from getting a professional rental price assessment. While they can do a rental value prediction themselves, it helps to have someone with years of experience and market knowledge offer their perspective.
First, the service provider will perform a property inspection to assess the property's condition. They will then take into account the property's location and current market trends in your area.
When you know your property's true value, you can set competitive yet profitable rates. This will help attract new tenants and increase your occupancy.
Factors That Impact Rental Estimate and Value
A few different factors can affect how much you should charge for a short-term lease.
The first consideration is where your property is located. Properties in high-demand areas such as bustling city centers can justify much higher rents than those in smaller towns.
Second, renting out in peak season will change demand and pricing. Expect to fill out your properties much faster during the summer as opposed to during the spring months. Your property becomes more valuable when there's higher demand.
Finally, look at market demand. The demand for short-term rentals in your area can impact how often your property is booked. Popular tourist spots always have incoming and outgoing visitors that require short-term stays.
Figure Out Your Short-Term Lease
Performing a rental estimate is the best way to make sure you're charging the right amount for your short-term lease. Charge too high and you won't get a lot of tenants. But if you charge too low, you won't make enough of a profit.
PMI Galveston Bay provides property management services in both Galveston and Brazoria Counties. We can help property owners with accounting, compliance and inspections, self-managed services, and more. Reach out with any questions and to set up a consultation.
