Vacation Rentals Looking Up

By E-Renter Tenant Screening
Posted on September 21, 2012 under Rental Market | Be the First to Comment

If you own rental property in vacation areas, or a second home that you rent out, things may be looking up. According to a report from HomeAway, an online vacation rental site, 72% of vacation rental owners in markets where summer is considered peak season reported summer occupancy rates of 76% or higher. That’s an increase of 8% over the summer of 2011.

Not only were occupancy rates higher, but average weekly rental rates were, too. Average weekly rates were $1,493, or $213.29 per night. And 87% of vacation rental owners said business was the same or better than last summer.

The report also shed light on the importance of marketing vacation rentals. It states that owners on average spend over eight hours per week marketing and managing rental properties, and bring in an average of $26,000 per year in rental income. (The average HomeAway owner rents their property about 17 weeks a year for about $1,493 per week.)

How Vacation Home Owners Use Rental Income

• Like any income – for every day living expenses, discretionary spending, saving for the future: 43%
• To maintain or make upgrades to their vacation home – to purchase furnishings, perform necessary maintenance, paint: 59%
• To pay the mortgage on the property: 47%

Of those who use rental income to pay the property mortgage, nearly half (49%) said they’re able to cover at least three-quarters of it.

If you’re like most vacation rental owners, you purchased your property for personal use or a long-term investment. About half of owners say they spent from one to 28 days in their vacation homes, while 27% stayed more than a month.

HomeAway says the following markets are seeing a rise in demand and inquiries:

1. Balboa Peninsula, Calif. (222% increase in inquiries during the second quarter of 2012)
2. Reunion, Fla. (up 137%)
3. Aspen, Colo. (up 124%)
4. San Diego, Calif. (up 124%)
5. Folly Field, S.C. (up 116%)
6. Honolulu, Hawaii (up 115%)
7. Kissimmee, Fla. (up 114%)
8. New Orleans, La. (up 114%)
9. Vail, Colo. (up 111%)
10. Gulf Shores, Ala. (up 108%)

If you’re thinking of investing in a vacation home to rent out and enjoy for yourself, you might want to look into these areas, with significant increases in traveler interest.