Short or Long Term Rental?
So, you have an investment property. You have checked into all the details and you are able to have a short or long term rental in that location. So which should you choose? There are many advantages to both. Let’s explore!
Short Term Pros:
- You can use the rental for yourself or for family and friends. Simply mark that it is booked.
- You can block out time for necessary maintenance and repairs without disrupting a tenant and possibly having to pay for them to be displaced.
- Short term rental rates are much higher per night than long term rates. Many owners make their entire monthly mortgage payment renting their property for less than 2 weeks each month.
- If you have a less than exemplary tenant, they are only staying for a short period of time and you do not have to rent to them again.
- The property will be checked on a regular basis prior to people staying so any maintenance issues are typically caught quickly without doing extensive damage from an issue not being reported by a long term tenant.
- You can stop renting short term at any time after a short term tenant vacates. You can always decide to change to a long term rental.
Long Term Pros:
- You (in theory) have a steady stream of income each month.
- You don’t have to constantly be looking for new tenants.
- Long term tenants may decide to stay for multiple lease terms, thus having very low turnover.
- Long term tenants may tend to treat the property more like their own and handle some of the smaller maintenance items themselves.
- Typically, if there is painting or carpet replacement needed, that is only having to be addressed on a yearly basis at minimum.
- You create a trusting relationship with long term tenants and “know” who is regularly in your property.
- Special permits and hotel taxes are not required for long term rentals.
- There aren’t as many regulations on long term rentals and they are less restricted.
Hopefully this will give you a general idea of whether a short or long term rental is right for you. Of course, your Realtor would be happy to help you figure out which option might be best for your particular property.
Happy Short or Long Term Renting!
Photo courtesy of Stuart Miles via freedigitalphotos.net
Michelle Froedge is a residential Realtor and Principal Broker in the Greater Nashville and Williamson County areas of Tennessee. “Mom” to four-legged fur baby, Tyler, Auntie to Zelamie, she is a vegetarian and sings in her spare time. Michelle has lived in Nashville and Franklin since 1997 and has been selling homes since 2004.