In the age of social media interconnectedness, online vacation rental sites like AirBnb and HomeAway have gotten popular with travelers both at home and abroad. This could be benefitting vacation property buyers in some areas. In comparison to investors, who generally plan on renting their properties for 365 days, vacation buyers prefer short term rentals – those rentals that are 30 days or less at a time. Data from the latest Investment and Vacation Home Buyers Survey shows that 40 percent of buyers of vacation homes will at least try or plan to rent out their properties for a short term in 2016, while 24 percent rented or tried to rent their property in 2015.
Twelve percent of vacation buyers who rented in 2015 plan to do so again in 2016. Twelve percent of those who tried to rent in 2015 plan to try again in 2016. Of those who didn’t try to rent in 2015, 8 percent plan to rent in 2016 and of those who didn’t rent (didn’t try to rent it) in 2015, 8 percent plan to in 2016.
Seasons are important in deciding when to rent. Thirty-eight percent of vacation buyers will rent their property in the summer, 17 percent in the winter, 14 percent in the fall and 11 percent in the spring, making spring a lower popularity time of year. Thirteen percent are willing to rent any time of year. Vacation buyers are more likely to use a property manager or social media to rent their property, while investors are more likely to use a traditional real estate agency.
Vacation buyers are motivated to rent their properties for additional income. More often than investors, they want rental income to help pay down the mortgage faster. Eighty-nine percent of vacation buyers reported potential rental income at least moderately impacted the monthly costs of ownership through additional income to mortgage.
Meredith Dunn, Research Communications Representative, manages Real Estate INSIGHTS, the Research Update, and assists in managing Research content on Realtor.org as well as on various social media sites. She also produces video content for the multimedia portion of the Research site.