With the peak holiday season around the corner, savvy landlords will be going all out to maximise their return on their holiday homes.
Christmas is fast approaching and many people are gearing up to rent out their holiday homes in the hope of making a mint during the peak season. But this doesn't mean that anything goes and that holiday tenants will be willing to put up with substandard accommodation simply because the property owner doesn't know the first thing about letting property. Likewise, it doesn't mean that any Tom, Dick or Harry can rent the premises for their holidays. The property has to be maintained to a certain standard and tenants have to be vetted before they are given the keys to the home.
One of the biggest mistakes a landlord can make is overpricing a holiday home. Yes, you may be able to find some poor desperate soul who left things to the last moment who will reluctantly rent the home, but this doesn't play well for those who are hoping to secure a good annual income from the let.
As with everything in property the price you will be able to charge will largely depend on the location of the home. Seaside homes that are on the beach will generally earn more than something that's situated further away from the ocean. However, even this is relative and you are obviously going to earn far more for a property that's situated in a prime holiday area as opposed to something located in a less-desirable holiday town.
Know your customer and become familiar with the type of people that frequent the area in which the home is based. Generally speaking, people who are willing to pay top dollar will look for holiday rentals in places like in Cape Town or Umhlanga in KwaZulu-Natal, while those who have to watch their pennies will chose less expensive areas. This, however, could well differ from town to town and it's therefore important to do your research in order to not price yourself out of the market in your particular area.
For this reason it's advisable to buy something in an area you are familiar with and price it in line with other similar properties in the area. A good holiday home investment should earn income all year round and although things may taper off outside of school holidays, you should ideally be able to let the property out at least once a month.
Don't expect too much too soon and you should start off by simply trying to cover the costs of your bond, only increasing the rent once the property has earned a good reputation. Word of mouth is, as always, the best way to advertise and having guests favourably review their experience in your home will encourage more bookings which will, over time, impact on the amount you can charge.
Getting the home ready:
Holiday home furnishings need to be both practical and comfortable. Lounge suites for example should be covered with an easy-to-clean fabric or better still, leather. Put yourself in your tenant’s shoes: you are on holiday, you're going to want to relax in comfort and put your feet up on the coffee table so furnish the home with furniture that can take a bit of a pounding, but that won't break the bank if it needs to be replaced.
Buy the best beds you can afford. Everyone enjoys a good night’s sleep and this is particularly important when on holiday. Good linen is also a bonus, so consider buying something that boasts a higher-than-average thread count.
Bathrooms need to be spotless and mould free and although not strictly necessary, complimentary soaps and shampoos will impress your temporary guests no end.
The same goes for the kitchen. In addition to being immaculate, owners need to check that everything including the fridge and the stove are in good working order. All the crockery, cutlery as well as the pots and pans should be inspected before a tenant takes occupancy.
Air conditioners should be serviced on a regular basis and must be in good working order. Batteries for all remotes should be checked and replaced where necessary.
Go and stay in the property at least once a year in order to check on the overall condition of the home, regardless of whether you use an agent to manage the property or not. Use this time to fix any snags and to replace broken appliances or fixtures as well as checking the overall condition of the property.