Is owning a vacation rental worth it? I’ll go over a few pros and cons today, as well as a new Arizona law that may make a short-term rental property worth your while.
I get asked about vacation rentals all the time, and there are a lot of pros and cons you should consider before investing in one.
One of the pros is that you can typically get more money by renting a property short-term than if you got a tenant to sign a 12-month lease. Vacation rentals can also help you with the costs of owning a second property. Plus, you get to use the property whenever you want by reserving dates ahead of time.
One of the major cons is the cost. First, there’s furnishing; you have to provide everything, all the way down to forks and knives. Vacation rentals also have higher utility costs and you have to pay to advertise the property.
These properties are also management-intensive. After all, you will be operating in the customer-service field. You also need to hire a reliable cleaner to prepare the units for the next tenant.
That said, for many people, the pros outweigh the cons.
The good news for people looking to buy a vacation rental in Arizona is that our governor signed senate bill 1350 into law and it took effect on January 1st. This law is the first of its kind, and it’s aimed at modernizing our economy.
This bill overrides bans on renting properties for less than 30 days. Many cities had bans on the books for short-term rentals, but this law makes those bans irrelevant. Now, city governments can’t restrict those home-sharing services for owners who wish to rent for under 30 days.
The bill also requires online providers to send rental taxes to the department of revenue, which takes some of the burden off of the property owners.
Now, before you go and buy a vacation rental, there are other restrictions you should look into. Homeowners associations may prevent short-term rentals, so do your due diligence and make sure you are allowed to rent a property for less than 30 days before investing in a vacation rental.
If you are interested in owning a vacation rental, I recommend looking in popular areas like Phoenix, Scottsdale, and Tempe.
If you have any other questions about vacation rental properties, just give me a call or send me an email. I would be happy to help you!