Leasing Your Property Short Term
If you’re an investor or a property owner, we look at the top benefits of a short term rental.
- Control over your property. A long-term lease can lock you out of your property for years at a time. Regardless of how a tenant maintains a property, landlords have very little control once they have signed a lease.
Issues like poorly maintained gardens, pets, clutter or general mess is not enough to move a tenant on nor can a landlord force a tenant to comply. Whereas short term leases allow landlords to properly maintain their property on a regular basis.
Regular property maintenance protects the long-term value of your home and sets it apart from properties that have the visual signs of long-term neglect.
Having access to your property gives you the freedom to move back in at any time. Traditional long-term leases that are in fixed contracts normally lock their landlord out of the property until the fixed lease term is complete.
- Cash flow: is the biggest benefit when it comes to short term leasing. It’s not uncommon to potentially double your rental income or generate extra cash while you’re on holidays. A few different types of rentals people make money from:
a. It’s a growing trend to lease out a spare or un-used bedroom while you’re living in the property. This is a great source of increased cash flow that you can use for whatever you like.
b. Holiday rental. Leasing out your home or holiday home to tourists is a great way to double or triple your cash flow in comparison to the traditional long term lease method. Normally, the tourist tenant only comes in during peak time of the year which still allows you to access your property most of the year.
- Avoid lengthy eviction process. In Victoria, it can take up to 75 days to evict a tenant that refuses to pay rent. To make a bad situation worse, if the evicted tenant has left unwanted furniture, the landlord must keep the tenant’s items for a further two weeks and allow the tenant access to their belongings.
This can be a very stressful time for landlords where they stand to lose thousands of dollars in unpaid rent, bear the cost of property repairs, rubbish storage and removal.
- Find your own tenants: Like with everything in the modern day, short term leasing is now very accessible to the general public with website platforms like AirB&B. Traditionally, using a property manager to find a tenant was only available for long term rentals and associated with high leasing costs.
With a short-term renting model, the risk of the above is greatly reduced. In most cases, short term rentals are pre-paid in full and upfront. The chances of attracting tenants that become squatters is highly unlikely.
Short term vs long term leases really comes down to how involved you would like to be when it comes to leasing out your home or investment property. The above benefits give landlords a freedom traditional leasing can’t offer.
About the Author:
Mark Ribarsky is a Licenced Estate Agent, Bachelor of Business and the founder of Wise Real Estate Advice.