Selling a vacation rental home can be tricky – there’s a fine line between continuing to maximize your revenue and creating opportunities for someone to come and buy your home.
So, what should you do? Consider these points from real estate experts to ensure you don’t lose money when your home is on the market:
Discuss the sale with your property manager and management company.
You’ll want to work closely with your real estate agent to negotiate how the future bookings will transfer and how the property manager and management company will be paid after the sale. All agreements should be put in writing and agreed upon before you list or sell the property.
Make sure selling is a smart financial move.
Even if you’re confident you want out, it’s wise to hire an accountant before you put the house on the market. You want to understand your return on investment and ensure your money would perform better elsewhere. If you are thinking of using the proceeds for a retirement property or savings, there are tax implications, and some of those may soon change. It’s vital to understand financial details before you list your home. “You want to look at all of that before you go to sell it,” said James Nellis, The Nellis Group, Keller Williams Alliance Realty, Alexandria, Va. “I see people basically trade houses when they should just stay with what they had, especially when you factor in closing costs (and interest rates).”
List your home in the high season.
Many vacation homeowners don’t list their homes during the prime rental season during the three or four months when they earn the majority of their income, said Nellis. Plus, it’s not ideal to have a prospective buyer look at a home that isn’t in pristine condition. One option is to create a video of the property. Also, have excellent quality photos available. Make sure the images include all rooms and are as detailed as possible, such as showing inside closets, the water heater, and other features. At the same time, consider setting three windows of time each week the property can be shown. That way you can ensure the property is available to be seen in optimal condition.
Set specific days and times for showings.
Ideally you want to make sure that the property is as close to pristine as possible. You also don’t want to rush potential buyers through the property. Nellis sets specific times and days when buyers can view certain properties. That way realtors can plan ahead with prospective buyers.
Tell potential buyers that you need to limit showings due to reservations.
Don’t be afraid that buyers will shy away from your property because you need to limit when it can be shown. Buyers want to know that you treat your guests well and will be happy to hear your property is booking! Also, showing your commitment to guest privacy and being an excellent host means happy guests, which equals future reservations.
Offer guests a fee if they allow the home to be shown.
Prepare for the unexpected such as a serious prospective buyer who can’t view the property during a designated window. One way to do so is to tell your guests that the property is for sale. Explain that you may need to ask them to allow it to be shown when they are there, said Realtor Mary Anne Davis, Keller-Williams Legacy, Baltimore. Offer the guests a discount on the rental fee in return for ensuring the property is clean, neat and available at a specified time. Another option: If there is a favorite restaurant in the area, reach out to the owners and see if you can secure a discount or free meal for a guest who is displaced during a showing. “That is an extra way to thank the guest. And you can pay the restaurant back by publicizing their restaurant,” said Davis.
Don’t stop booking.
That’s true even if you think your property will sell quickly. “You never know what’s going to happen in real estate. You can have a person ready to buy, and their financing falls through or something else happens,” said Davis. “Deals fall apart at the table. You don’t want to lose the sale and then not have any booking for three or four months. Keep booking.”
You can sell your vacation rental property and not lose rental income. The key is to work closely with your property manager and realtor to ensure guests are not inconvenienced but prospective buyers have ample information to make decisions. That way you’ll ensure you don’t sabotage your rentals or your sale as you keep income flowing.