Owning a home is seen by many as the ultimate investment and sign that you've "made it" and the decision to rent it can be a difficult back and forth. There are some obvious pros and cons to each method of renting that should be weighed. Traditional renting can provide the security of long term tenants and consistent cash flow while vacation rentals can exceed cash flow with certain additional requirements. Before you decide what's best for you, here are some things to consider:
#1. Is a short term rental legal in your area? In the Las Vegas area alone, there are multiple cities with their own rules. Henderson has formally legalized STR's (short term rentals) with their own set of extensive regulations while North Las Vegas and Las Vegas have not made formal decisions. Make sure you know what those regulations are to avoid fines.
#2. Do you have the time to oversee the administrative work? When we launched our first short term rental, I was spending hours doing administrative work to prepare and interact with guests. Over time, I have streamlined and automated how I work with all of our guests to make sure they have a great experience without me feeling like I am stuck behind a screen preparing for them all day. However, there is still time that must be committed to this process.
#3. Are you available 24/7 for issues? We lived in our home for 12 years before moving and choosing to make it an STR so we luckily knew all of the tricks and quirks to our house. You have to keep in mind that your guests will not. Prior to optimizing our rental, I had to meet every guest at check-in time (yes that meant getting out of bed at 1am at times). We have had normal home maintenance emergencies pop up that had to be addressed for guests to be comfortable. When we go out of town, we have a backup that is available to take calls for us as well. The worst thing that can happen is a guest have an issue and not be able to reach you.
#4.Do you have reliable cleaners? Having a cleaning team on standby that can be in as soon as a guest checks out and have the home ready for a same day checkin is critical to optimizing your income and not losing rented days.
#5. Do you know what guests to look for? This is probably one of the most important pieces to the equation. You have to know what to look for when renting to guests. Our neighbors were our best friends and the last thing we wanted to do was piss them off by offering up our home for weddings, massive parties, and anything else you can name that would disturb their home lives. We diligently evaluate every guest before approving them to ensure they will treat our home like their own and we (knock on wood) have never had an issue with a guest being disrespectful.
Having an STR vs a traditional rental has been an amazing experience for us. We have more than quadrupled what our traditional rental income would have been. We've met some incredible guests from around the world that chose to stay with us and we've also been able to inspect our home regularly to ensure its being cared for. And we still book it for ourselves during the occasional neighborhood party so we can be right at home with our friends.
