Owners of vacation properties are reporting that their earnings have dropped substantially. While short-term rentals once seemed like a great investment, that may no longer be the case. If you want to invest in real estate, long-term rentals are the way to go.
The higher income from short-term vacation rentals is tempting, though. Why wouldn't you want to take that risk?
Read on to learn all about why long-term rentals are the obvious choice for new investors.
Consistent Tenants and Income
When you have a long-term rental, you stick with one tenant (or group of tenants) for the duration of a lease. That lease may be several months to a year, and the tenants may end up renewing their leases when they're done.
Many new investors don't see the value in this type of consistency. They see the higher income available from short-term rentals for vacations and assume that that's automatically the better option. But what happens when there aren't travelers around or when people start deciding to use hotels instead of short-term rentals?
Housing is always going to be a necessity. When people aren't spending money on vacations, they'll still be spending money on places to live. Because of this, your income from long-term rentals will be far more consistent.
You also don't have to worry about constant tenant screening. You screen once right before your tenants sign their lease(s) and you're ready to start collecting rent.
You can expect the same amount of money every month. Even though you aren't able to raise the rent like you can with short-term rentals, that consistency is incredibly valuable.
Less Maintenance and Cleaning
When you own a rental unit or home, you have to spend money on maintenance and cleaning. That cleaning will often be in any common areas of a multi-family property or between tenants to ensure that the rental is ready for the next person.
Maintenance will happen whenever a tenant requests it, but you'll also need to hire maintenance professionals to upkeep the plumbing and HVAC systems and to handle outdoor areas if they aren't the tenant's responsibility.
In short-term rentals, cleaning has to happen between every tenant. You can ask tenants to clean, but asking them to clean a vacation rental as they would their home will deter them. After all, short-term rentals are akin to hotels, and most vacationers would rather not clean up significantly.
People who are renting a vacation rental may also be more likely to cause damage, especially if they're there to party in Las Vegas.
In short, you'll be spending a lot more money on general upkeep if you have a short-term rental.
Fewer Restrictions and Risks
The laws surrounding short-term and vacation rentals are changing and will likely continue to do so. While housing laws may also change, they'll be more consistent.
Some areas are banning new short-term rentals entirely. Your long-term rental is a much safer bet.
Long-Term Rentals Are the Obvious Choice
Short-term rentals may get you more income at first, but long-term rentals are secure and consistent. People will always need housing, even during times of financial hardship. Opting for long-term rentals will make your investment worthwhile.
To make your investment even more valuable, why not hire a property manager? If you own property in Las Vegas, we want to help you manage it. Learn more about our services and get your free rental price analysis today.