By Roger Jimenez
Taking on the task of turning your property into a short-term rental in Orlando is a promising venture, but it comes with its own set of complexities. Our dedicated team at The Orlando Real has meticulously compiled a comprehensive checklist to guide homeowners through the intricacies of this exciting endeavor.
Read along or watch the video below for more!
1. Can you rent a short-term rental in that community?
Understanding the nuances of community regulations is crucial. For example, not all neighborhoods are open to short-term rentals. While areas like Davenport or West Kissimmee are known to be receptive to short term rentals, certain communities like Horizon West or Downtown Orlando, might have some restrictions or flat out not allow them. Familiarizing yourself with these regulations will ensure a smoother process in setting up your rental.
2. How will the property be used?
A crucial aspect often overlooked is the intended use of the property. How do you plan to use it? Some homeowners invest in multiple properties with the plan to transition into them eventually. However, certain communities are designed more for short-term living, lacking affiliations with schools and even foregoing traditional mail services in order to save money. In cases like these, the distinction becomes crucial in shaping your overall strategy.
3. Should I purchase new or resale?
The choice between purchasing a new property or a resale home presents unique considerations. Resale homes come with a built-in charm and may already be furnished, expediting the short-term rental setup. On the other hand, opting for new construction offers customization possibilities, assurance against structural issues, and an opportunity to curate the perfect short-term rental experience. However, this comes at the expense of immediate availability. Make sure to do your research into the pros and cons for each of these options!
4. Amenities
The amenities offered by the neighborhood play a pivotal role in attracting potential guests or you if you plan on living there later on. While some communities show off a plethora of offerings such as pools, gyms, and community centers, others may lack any of these features. Carefully assessing these amenities and understanding how they align with your target audience can significantly impact the appeal and potential rental income of your property.
5. Are you going to be forced to use an on-site management program?
Some neighborhoods impose the use of on-site management programs for short-term rentals. While this can provide certain benefits, such as increased nightly rates and hassle-free management, it often comes at a cost. Homeowners may find themselves paying anywhere from 25% - 40% of the gross rental income to these programs. Understanding the implications and weighing the pros and cons are crucial steps in this decision-making process. However, its important to note that some opted homeowners have made 10% more per night than those who took care of management on their own. Definitely something to think about!
6. HOA Costs and Amenities
Homeowner's Association (HOA) costs are often viewed as a necessary evil, but their impact extends beyond monetary considerations. Evaluating both the costs and the amenities included in these fees is vital. Some communities might have additional features like golf or tennis courts that enhance the overall appeal of the area. However, these amenities may not necessarily be covered by the standard HOA fees, influencing your pricing strategy. So make sure to look into these costs and amenities thoroughly.
7. Heads in Beds!
One of the easiest ways to maximize your short term rental potential that is always within the power of the homeowners is to make sure that you're capitalizing on the space in your rental as efficiently as possible. For instance, a large bedroom with only one bed could be transformed by adding extra beds in suitable spaces, potentially doubling or even tripling your income from a single stay with a quick and simple adjustment.
8. History & Finances
Lastly, gaining insights into the financial performance of the property is an excellent strategy move. If possible, tapping into the financial history and experiences of previous homeowners can provide valuable information about the home's profitability over the years. This data becomes crucial in predicting potential challenges, such as rising interest rates or increased competition in the area. With this financial knowledge, you can make informed decisions to ensure the long-term success of your short-term rental.
Overall
Navigating the complex landscape of short-term rentals in Orlando definitely requires a thoughtful approach and careful consideration of community rules, property specifics, financial aspects, and strategic planning. With these key considerations in mind, homeowners can confidently look forward to the vibrant and competitive Orlando Airbnb market. By staying informed and addressing these vital aspects, your short-term rental investment is sure to be off to the races!
The Orlando Real is sponsored by The Pozek Group. If you’re thinking of buying or selling a home in Orlando, reach out and we would love to help!
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