Ormond Beach is a popular tourist destination. We have gorgeous beaches, championship golf courses, great shopping and seafood, and several state parks and natural springs throughout Volusia County that make for great soaking, snorkeling, fishing, and boating.
With so much tourism here, you may be wondering whether you should rent your property out for the short term or if you should stick with long term leases. We get this question a lot, and you need to know what will work best for your investment goals and your property.
Short Term Leases and Vacation Rentals
One of the benefits to renting your property out with a short term lease is that it gives you more flexibility if you’re planning to move back into the home or if you want to spend some time there yourself. It allows you to give notice and have the option of moving in when the need arises. Perhaps you want to spend the winter months at your beach condo, but rent it out for the rest of the year. Short term rentals allow you to do that.
You can usually get a little more money for the property if it’s rented for a shorter term. A lot of landlords do really well renting their properties out on sites like Airbnb or VRBO. It’s easy to generate some good cash flow this way; what you earn per night is much higher than a monthly rent that comes in through a traditional 12-month lease.
However, there are risks to short term rentals.
One drawback to renting your property out for a short term is that it’s more labor intensive. You must be committed to staying involved in finding new tenants and getting them in and out every few days, weeks, or months. You’ll have to handle the rental agreements and make sure the property is in good condition during each turnover.
You also have the potential for more vacancies. The property won’t always be occupied, so you’ll need to constantly look for tenants. You’ll probably rent your home easily during spring break or snowbird season, when northern residents come down to Florida for a few months. But, there will be vacancies in the slower tourist months, and it will add up to a loss that may exceed the extra rent you earn during periods of occupancy.
Long Term Ormond Beach Lease Agreements
One of the benefits to renting a property for the standard 12-month term is that these are the homes a majority of the tenant pool is seeking. They are looking for a stable property that will be their home for at least a year. You’ll usually find tenants who are hoping to stay for longer than 12 months.
With most long term leases, average tenants stay in place for two years or more. This is especially true if you’re providing great service and providing a comfortable, well-maintained home. Long term tenants add some stability to your investment.
Long Term Leases Tend to Earn Investors More
We are always happy to manage short term vacation rentals for our clients. We can handle tenant turnovers, maintenance responses, and the ongoing care and management of your property, whether the lease term is a week or a few months.
However, we believe that in general, long term leases are a better investment model for investors who own Ormond Beach rental property. You’ll pay a lower management fee for your long-term rental property, and you’ll benefit from fewer vacancy and turnover costs. A long-term tenant will continue paying rent consistently every month while your investment property appreciates. Your ROI will likely be greater than what it is with your short term rents, especially if you’re following the advice and direction of your experienced property manager.
We’d be happy to tell you more about your options. Contact us at Oceans Luxury Realty.