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5 Key Tips To Prepare Your Vacation Rental Property For Sale
There are countless reasons why a vacation rental owner would want to sell. Perhaps they are looking to upgrade to a larger property or a new location. Perhaps the real estate market has been surging and it’s a great time to bank profits. Or perhaps they are looking to cash out to fund another aspect of their lives such as a child’s education, or retirement. Regardless of the reason for wanting to sell, all owners considering putting their vacation rental up for sale would be wise to heed the following tips:
1. Select a Realtor with Vacation Rental Expertise
Not all realtors are created equal! Most realtors tend to have a specific niche in the market where they can claim a knowledge advantage over their peers. Some are relocation specialists, while others have the contacts that make them luxury and high-end real estate experts. If you are looking to sell your vacation property, then without question you need to seek out a realtor that has extensive experience in the vacation rental market. One great place to start is by asking your property manager who they have experience dealing with in the vacation rental sales arena. In many cases, the owners of vacation rental management companies are often brokers themselves and could be your best choice for the following reasons:
2. Know Your Numbers
Prospective investors want to glean as much information and data as they can regarding a property’s balance sheet. Before putting your property on the market, be sure to have the following data ready and available for inspection by qualified buyers:
3. Make Time for Maintenance and Inspection
You know those regular maintenance items that you have been neglecting while your calendar remained full of vacation guests? That fresh coat of paint, cabinetry upgrade, or new appliance you had planned? It is an excellent idea to block your calendar for a week prior to listing to give your property the refresh it needs to get investor attention. Just a couple of thousands of dollars invested in new paint or hardware upgrades can result in commanding many thousands more in the eventual sale price.
Furthermore, sellers may wish to hire a licensed property inspector to identify any potential issues with the property and its systems that a new buyer may uncover during the due diligence period. By addressing any issues prior to putting the property on the market, sellers can again reap benefits by attracting buyers to a turn-key operation in good shape. Your realtor can usually recommend several home inspectors to choose from, or you can visit the International Association of Certified Home Inspectors to search for inspectors in your area.
4. A Picture is Worth a Thousand Words
With all the hyper-advanced photography that exists at one’s fingertips in 2021, it’s shocking how many property listings - both on VRBO/Airbnb and the MLS - feature terrible photos. Your property will never achieve it’s potential max sale price nor will it ever attract the the greatest buyer interest with horrible photos. Next to a realtor with a fat rolodex of clients, a great photographer is a vacation rental seller’s best marketing investment. And you needn’t break the bank when selecting a professional photographer! In the Southeast United States, IMoto is one of the best real estate photography operations that we have found, and their packages start as low as $150.
5. Manage Your Bookings Accordingly
It can be difficult for prospective buyers to get access to view a property if you have a full calendar of vacation rental guests. Consider making a note on your vacation rental listings that say that the property is currently for sale and that guests may be asked to accommodate a brief showing of the property in exchange for a discount, gift card to the local coffee shop, or some other reasonable gesture of appreciation. There’s an upside benefit to posting this on your Airbnb/VRBO listings, as often times buyers emerge from among your pool of rental guests. It’s free advertising and guaranteed to reach hundreds of people already accustomed to travel in the vacation rental world.
Secondly, owners must decide how best to manage bookings further out on the calendar in the event of a sale. Some buyers are quite eager to keep any existing bookings after a sale date, as they can already “bank” on that income coming in. This works best when the property can remain in a vacation rental management program for at least a prescribed duration (90 days, for example), which allows for any transition to new managers if desired. Some buyers want to purchase a property and have an empty calendar so that they may redecorate, perform upgrades, or spend personal time in the property for a while first before welcoming their own guests. Every property and every deal will be different, as buyers and sellers each have unique motivations and circumstances that they bring to the transaction. Therefore it is important to have at least a plan A and plan B for how to manage existing bookings on the calendar. This flexibility will payoff by being able to adapt to the unique needs of any prospective buyer.
Hiring the right realtor with vacation rental knowledge is the single most important step you can take when preparing to sell your vacation property. An experienced realtor will likely be able to walk you through your balance sheet data collection, needed maintenance, photography, and booking calendar decisions. But if you come to the table prepared with this information already, your realtor will be able to hit the ground running and get you to the closing table that much faster.