Does anyone rent out a second home and it generally goes fine?

[Anonymous]

There is the perfect second home we'd like to buy. It checks every single one of our boxes, but it's 1 year earlier than we'd like to buy due to this being the last year we are paying for FT childcare. We can afford the second mortgage now, but next year would give us a lot more wiggle room and I'm very conservative with savings. Anyway, I'm thinking we could rent it out on a low key basis like not go balls to the wall trying to fill the calendar, but moreso however often it rents will be a nice bonus.

Does anyone do this successfully? Or do you have to go all in on renting it out?

We've been diligently watching what comes up for 3 years to get an understanding of inventory and this is the only house that's checked everything and more. I feel more nervous to pass it up than to have a financially tight year.

[Anonymous]

I’d buy it with the assumption that it won’t rent. Then find a local re agent or Airbnb it, see if anyone bites.

[Anonymous]

We bought a place in Rehoboth with the plan to partially rent it out - not to go crazy, but to supplement. And, if it didn't rent, we could still afford it.

We used VRBO and do it all ourselves, for the most part. The first summer we rented it out about 5 weeks. We did all the prep and the inbetween turnaround ourselves. Mostly we wanted to see how it was - what kind of shape was the house in after renting? Pain points? Anything needed? etc. It all was fine. We had a couple of questions from renters that first year but it was all good. Summer 2, we rented 8 weeks, plus a handful of weekends into the fall. We hired on our own a cleaner who was reliable and did the cleaning for us, and we made nearly enough to break even. Year 3, last summer, was the first year covid was really and truly not a concern and by all accounts more people were taking bigger vacations and rentals were down in DE. We only rented 3 weeks and went back to covering the cleaning ourselves. It was fine, and enough money to buy some patio furniture and a few smaller things.

We have 4.5 weeks booked this year. That's going to give us about half of the costs. It would be enough to take a nice vacation ourselves (though I will say my husband doesn't want us to travel when the place is rented, in case something happens and we need to get there - valid concern, but it keeps us tied down more than I want).

Sometimes we talk about hiring a company - that would get more bookings, and we wouldn't have to worry about cleaning. But it makes it less personal? I think people do take decent care of our place because it is not a bland white box.

Our kids are teenagers, and busy. So we don't get there as much as we would like. Weekly rentals - sat-sat - are tough, too. it really cuts into when you can be there - the year we had 8 rentals, we had no weekends to just go down.

But yeah, if this place is in a rental heavy tourist area, part time renting can work. It's not without work.

[Anonymous]

I haven't done this, but our back up plan was to rent it to friends and friends of friends if we needed the money. We're also financially conservative but ended up being fine without renting it.

[Anonymous]

I rented my beach place out full time in 2017 to a family and literally have not seen it since 2017 in person. My wife growing up had a tenant rent a house next to them for 30 years.

My current neighbor is a rental house that has been rented since 1975. Same owner since 1975. I only say owner once in last decade.

It can be done

[Anonymous]

Anonymous wrote:We bought a place in Rehoboth with the plan to partially rent it out - not to go crazy, but to supplement. And, if it didn't rent, we could still afford it.

We used VRBO and do it all ourselves, for the most part. The first summer we rented it out about 5 weeks. We did all the prep and the inbetween turnaround ourselves. Mostly we wanted to see how it was - what kind of shape was the house in after renting? Pain points? Anything needed? etc. It all was fine. We had a couple of questions from renters that first year but it was all good. Summer 2, we rented 8 weeks, plus a handful of weekends into the fall. We hired on our own a cleaner who was reliable and did the cleaning for us, and we made nearly enough to break even. Year 3, last summer, was the first year covid was really and truly not a concern and by all accounts more people were taking bigger vacations and rentals were down in DE. We only rented 3 weeks and went back to covering the cleaning ourselves. It was fine, and enough money to buy some patio furniture and a few smaller things.

We have 4.5 weeks booked this year. That's going to give us about half of the costs. It would be enough to take a nice vacation ourselves (though I will say my husband doesn't want us to travel when the place is rented, in case something happens and we need to get there - valid concern, but it keeps us tied down more than I want).

Sometimes we talk about hiring a company - that would get more bookings, and we wouldn't have to worry about cleaning. But it makes it less personal? I think people do take decent care of our place because it is not a bland white box.

Our kids are teenagers, and busy. So we don't get there as much as we would like. Weekly rentals - sat-sat - are tough, too. it really cuts into when you can be there - the year we had 8 rentals, we had no weekends to just go down.

But yeah, if this place is in a rental heavy tourist area, part time renting can work. It's not without work.

Me again. Is the house you're buying furnished or unfurnished? It costs A LOT of money to fully furnish, from mostly scratch, a house. Our place is 4 bedrooms. We spent a ton on new mattresses, bedroom furniture, sheets, towels, fully stocking the kitchen, etc etc. I developed a new hobby of estate sales and auctions to add decor and some furniture (we got a whole bedroom set - in unpopular dark wood, but solid and gorgeous in fabulous shape - for $250!). I no longer remember exactly but the outlay was more than 30K. Maybe close to 40. We bought a lot the year we rented and were able to deduct business expenses, travel to and from for the cleanings, etc (to a certain extent - there are rules about this and I'm not the tax person so grain of salt but look into this).

When we stop renting, I could see having one more summer with a good number of rentals and using the money to buy replacements - the couch, maybe a mattress or two, anything showing wear and tear.

[Anonymous]

You will be happier if you can rent it for a block of time, like a month or a season. If you try to do the Airbnb thing where it turns over every weekend, you will be spending a lot of money on management, cleaning, etc.

[Anonymous]

We bought a Condo in Rehoboth in 2019. The summer rental season pays for the year as far as mortgage/hoa fees/utilities.
We do rent in the off season too but don’t stress about it, it’s just extra income.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We bought a place in Rehoboth with the plan to partially rent it out - not to go crazy, but to supplement. And, if it didn't rent, we could still afford it.

We used VRBO and do it all ourselves, for the most part. The first summer we rented it out about 5 weeks. We did all the prep and the inbetween turnaround ourselves. Mostly we wanted to see how it was - what kind of shape was the house in after renting? Pain points? Anything needed? etc. It all was fine. We had a couple of questions from renters that first year but it was all good. Summer 2, we rented 8 weeks, plus a handful of weekends into the fall. We hired on our own a cleaner who was reliable and did the cleaning for us, and we made nearly enough to break even. Year 3, last summer, was the first year covid was really and truly not a concern and by all accounts more people were taking bigger vacations and rentals were down in DE. We only rented 3 weeks and went back to covering the cleaning ourselves. It was fine, and enough money to buy some patio furniture and a few smaller things.

We have 4.5 weeks booked this year. That's going to give us about half of the costs. It would be enough to take a nice vacation ourselves (though I will say my husband doesn't want us to travel when the place is rented, in case something happens and we need to get there - valid concern, but it keeps us tied down more than I want).

Sometimes we talk about hiring a company - that would get more bookings, and we wouldn't have to worry about cleaning. But it makes it less personal? I think people do take decent care of our place because it is not a bland white box.

Our kids are teenagers, and busy. So we don't get there as much as we would like. Weekly rentals - sat-sat - are tough, too. it really cuts into when you can be there - the year we had 8 rentals, we had no weekends to just go down.

But yeah, if this place is in a rental heavy tourist area, part time renting can work. It's not without work.

Me again. Is the house you're buying furnished or unfurnished? It costs A LOT of money to fully furnish, from mostly scratch, a house. Our place is 4 bedrooms. We spent a ton on new mattresses, bedroom furniture, sheets, towels, fully stocking the kitchen, etc etc. I developed a new hobby of estate sales and auctions to add decor and some furniture (we got a whole bedroom set - in unpopular dark wood, but solid and gorgeous in fabulous shape - for $250!). I no longer remember exactly but the outlay was more than 30K. Maybe close to 40. We bought a lot the year we rented and were able to deduct business expenses, travel to and from for the cleanings, etc (to a certain extent - there are rules about this and I'm not the tax person so grain of salt but look into this).

When we stop renting, I could see having one more summer with a good number of rentals and using the money to buy replacements - the couch, maybe a mattress or two, anything showing wear and tear.

This is a good point. Buying a home that's furnished saves a lot of money, which is helpful when you just paid for the down payment. Plus it's ready to rent if you suddenly need the money.