Are you planning to rent out a second home or vacation house in Colorado Springs for side income?
Millions of people visit the Rocky Mountains throughout the year. This interest is a great opportunity to start a short-term rental portfolio.
It's so important to have a plan before jumping into this venture. Expenses are necessary, but you don't want to lose too much money on your first rental. That's why it helps to have an experienced short-term rental management company by your side.
The first mistake owners make is not working with a property management company from the beginning.
Here are a few more mistakes to avoid.
Not Getting a Rental Valuation
Did you know you can get rental valuations for free?
Team Colorado CASA PMI even offers a free rental analysis tool for owners.
All you have to do is input the required information, like addresses, square footage, and the number of bedrooms, to receive a valuation amount in your inbox. This step is a good starting point for understanding the true value of your property.
Pricing Mistakes With Short-Term Rental Management
Pricing your rental before getting a rental analysis is a big mistake. You may end up pricing your vacation home too high or too low. Both of these mistakes cut into your profits, either way.
You should also analyze the values, property types, and amenities of surrounding rentals. You can view these rental prices online if they're being rented. Property value data is also available online.
Next, research the rental market in Colorado Springs. For example, what is the going rate for a two-bedroom short-term rental in the area?
Prices do fluctuate. You're allowed to price your rental accordingly when it's peak and shoulder season. Discounting your rental during shoulder season will attract more visitors during less crowded months, keeping your properties filled.
Not Screening For Tenants Properly
This next mistake is one of the biggest blunders you can make.
An excellent tenant is one of your greatest real estate assets. You don't have to worry about the cost of property damage and spending money on extra repairs and replacements. They're also responsible, paying rent on time and maintaining excellent relations with landlords and neighbors.
If you're having issues with irresponsible tenants, it's time to change your screening process. This issue, again, echoes the importance of hiring a property manager who follows strict screening protocols.
A professional property manager will start by screening for identification, financial documentation, and criminal history. They may also conduct interviews with applicants in person or by phone. Applicants may also list references to verify past rental history; calling landlords can help gauge an applicant's behavior.
If you're listing your rental on a vacation rental site, make sure there is a rating and review system for both parties. This step will yield even more information about an applicant.
Take the Right Steps
Knowing what not to do is vital to maintaining passive income. Remember to get a rental valuation, price accordingly, and screen for tenants properly to avoid costly mistakes.
Team Colorado Casa PMI is a leader in short-term rental management in the Rocky Mountains. Browse our full product suite or contact us to talk to an expert.
