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Vacation Rentals
by Kevin H. Davis
Vacation Rentals are properties in prime areas for the seasonal
rental market. The best part about these properties are that
when they are not rented, you can enjoy them yourself. Rental
markets like Southern California or Florida have great seasonal
mrakets that pay the mortgage for the year in a few prime
months through weekly rentals. In the off months, you can
still fill the property with lower rates and continue the
income throughout the year. As a weekly rental, you also have
the opportunity to schedule around your own vacation.
Timing the acquisition of a vacation rental is crucial. As
the season nears, the current owners become less motivated,
because they know that the season is approaching to carry
them for another year. One of the great things about these
properties is you can also rent them yourself for a week and
see if the property suits you before even considering the
purchase. I also call on properties that are just listed for
rent and eventually inquire if the owner would be interested
in selling as well.
This weekend, we were able to build a great list of properties
we are looking at in the Newport Beach area. We talked to
several investors in the area, it is funny to hear the different
views of the people you talk to. To some, it's a great market,
while others feel it's too expensive. We met a lot of great
people and are still working out the numbers, but I expect
we will probably coop a deal between the three of us in that
market. It was sure nice to get out of the snow in Salt Lake
and walk on the beach in So.California.
The main thing you want to keep in mind for vacation rentals,
is you want to ensure you have a large cash reserve. Being
that the rental is seasonal, you want to ensure your reserve
will cover all expenses during the dry periods when it is
not rented.
Vegas can be a good vacation rental market as well, if the
location is good. It is also less seasonal since the gambling
market continues throughout the year. The main consideration
there is the summer heat.
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