7 Tips to Give Your Short-Term Rental a Competitive Advantage

by Sandy Dodge

A man works on his laptop with a view of a lake outside the window.

As the usage of short-term rental services has increased over the years, so too has the competition between rental owners to make their properties stand out. There are a variety of marketing tactics you, as a rental owner, can employ to give your home an edge, but ultimately, making the property as appealing as possible is the best way to ensure your strategies are effective.

1. Boost Your Curb Appeal

Renters are scrolling through pages and pages of properties, looking for something that catches their eye at first glance. To make your property stand out, invest time and energy into the home’s curb appeal. Making these improvements doesn’t necessarily require breaking the bank, either. Simple projects like a fresh coat of exterior paint, refinishing the patio or deck, and creating a beautiful yard will go a long way towards helping your home stand out amongst the competition.

2. High-Quality Photography

Once you’ve spent time curating and beautifying your rental, it’s important to communicate its feel to potential renters. High-quality photos give renters the best impression of what it’s like to spend time in the home. Photograph every room in bright lighting to make the space as inviting as possible. Be sure to thoroughly clean every room before taking photos to have it looking as inviting as possible.

3. Improve Your Description

After potential guests explore your photos, they’ll read your property’s description. While it’s helpful to read descriptions of other listings in your area to get an idea of what tenants are looking for, it’s important to communicate the unique attributes of your home. Talk about what makes it special, emphasize the selling points, and reference what renters are seeing in the photos you’ve provided.

4. Repair or Replace Your Appliances

When guests are paying for a rental, they expect everything to be in fine working order. To make your property stand out, consider repairing or replacing your appliances. This makes for a more enjoyable stay and could potentially offer you a competitive advantage. All appliances have a certain life expectancy, so if you haven’t replaced your appliances in a while, it just may be time to do so.

5. Upgrade Your Bedroom and Bathroom

Renters are looking to relax, so any luxury you can provide them will do wonders for giving your property an edge amongst the competition. Two areas of the home where you can deliver on luxury are the bedroom and the bathroom. From the bedspread and pillows to the curtains and rugs, experiment with different textures in the bedroom to make it as comfortable as can be. A high-quality mattress is also a worthy investment to make your guests’ stay all the more memorable.

By making simple upgrades to your bathroom, you can give the guests the feeling of having their own personal spa. High-quality shower heads and a spacious, relaxing tub will help to deliver a luxurious atmosphere to your bathroom, as will meticulously cleaning the space and keeping your surfaces well organized.

6. Upgrade Your Kitchen

A welcoming kitchen is the key to making your rental feel like home. Kitchen makeovers often come at a high cost, but there are ways to transform your kitchen without breaking the bank. Start by upgrading your lighting, giving your walls a fresh coat of paint, and refinishing your cabinets. If your kitchen needs new appliances, remember to select them first before making any renovations to ensure their dimensions are correct.

7. Provide a Workspace

With more people working remotely than ever before, some renters will likely look at your property as a potential place to conduct their work. Accommodating these guests with a quality workspace can make your rental stand out. Consider making the workspace multifunctional using items like a folding desk. This gives remote workers the option to stow their home office setup at the end of the day while ensuring that the workspace won’t be a permanent fixture for guests on vacation.

If you are interested buying or selling a short term rental property on beautiful Orcas Island give me a call or a text at 619.224.9015 or email at Roxy@RoxyMarck.com.

Consider This – Death and Taxes

I could not resist the headline. As they are the only thing sure in life it makes sense to write about them. My experience gives me enough knowledge to paint a picture using broad brush strokes. Anyone thinking of purchasing real estate should discuss the purchase with their legal and tax professionals.

Let’s start with a brief note about death. To be specific, let’s talk about what happens to your real property when you die. Simply put what happens depends upon where you live and how you hold title to your property.

State and federal law govern how the estate of the deceased is distributed and taxed. If you live in one of the nine community property states (AZ, CA, ID, LA, NV, NM, TX, WA or WI) and have a surviving spouse, most likely the property will automatically convey to the surviving spouse. If you place the property into a trust the trust may dictate what happens.

If you do not live in a community property state, or have no surviving spouse and the property is not in a trust, then most likely your property will need to go through probate. State law governs how the probate is handled. Some states have an inexpensive, streamline probate process. Other states have an expensive and lengthy probate process. Regardless of the state, any probate may become lengthy and expensive if there is a dispute among the survivors. This is part of the reason why it is important to create a will.

None of us want to think about death. And with the myriad of decisions to make during the purchase of real property this important issue may not receive the attention it deserves. If you have children from a previous marriage, a large estate or any other unusual circumstance it is in your best interest to discuss with the title officer or your tax/legal professional the method of holding title which will work best for your situation. You could also perform an internet search on how to hold title. Each state differs slightly so be sure that any article you read pertains to the state in which the property resides.

Moving on to taxes. As I’m sure the end result of reading about taxes is similar to that of having a lobotomy I’ll avoid lengthy discourse on the subject and limit the discourse to taxes relevant to real estate in San Juan County, Washington.

Since we were on the subject of death you should know that estate taxes will depend upon the total value of the estate including real and personal property. According to the IRS website, as of 2015 the federal tax applies to estates in excess of $5,430,000. The tax will not apply to an estate if it is left to a spouse or a federally recognized charity. Check with the state in which the property resides to determine the threshold for filing state estate taxes. According to the Washington State Department of Revenue as of 2015 that threshold is $2,054,000.

Property Taxes in San Juan County are paid semi-annually with the first half due on April 30 and second half due on October 31. The tax year runs from January 1 to December 31.

Typically the seller of real property will pay property tax to the date escrow closes. The buyer will pay from close of escrow to the semi-annual due date. These prorations are noted on the HUD1 closing statement.

If taxes have been paid on time then property taxes are pretty much a non-issue. Things become a little more complicated when the seller of real property has not made timely payments. This is where the preliminary title report becomes of value.

The purchase contract can provide a title review contingency. This contingency will give the buyer an opportunity to review the status of tax payments. If taxes are in arrears it would be a good idea to check with the escrow company to verify that there are sufficient proceeds from the sale to pay any delinquent property tax.

If the escrow closes in late March or late October I suggest the buyer contact the San Juan County Tax Assessor’s office to make sure any new tax bill is mailed to the correct name and address.

The San Juan County Land Bank Tax is paid each time the property sells. The tax is due at the close of escrow. It is typically charged to the buyer at a rate of 1% of the sales price of the property. All tax funds received go into a fund which is used to “preserve the natural heritage of the San Juan Islands”.

Washington State Excise Tax is also paid each time the property sells. The tax is due at the close of escrow. It is typically charged to the seller at the rate of 1.28% (1.78% for property within the city limits of Friday Harbor) of the sales price of the property. According to RCW 82.46.030 one percent of the funds are put into the county current expense fund and the remainder into the county capital improvements fund. Friday Harbor’s additional .5% tax funds are to be put into the municipal capital improvement fund.

FIRPTA, aka the Foreign Investment in Real Property Tax Act, is a withholding of tax on the dispositions of real property interests within the United States. It is a federal as well as a state (for those states with income tax) tax on the proceeds from the sale of real property by those persons who are NOT selling a principle residence and are NOT a resident of the state or the US. In other words, if you are selling your principle residence you are exempt from these taxes.

The seller of real property may be subject to both the Excise and FIRPTA taxes but it is the buyer of the real property who is responsible for withholding. Normally the escrow or the closing agent will perform the tasks of withholding and the filing of the proper tax forms. It is in a buyer’s best interest to use a qualified closing agent and to check with that closing agent to verify that the seller has completed the appropriate FIRPTA waiver or that the closing agent is prepared to withhold FIRPTA. Also check to ensure that there are sufficient net proceeds to pay any tax due.

Tax deductions (a favorite phrase) are one of the many advantages of owning real property. If you are ready to take advantage of some of the deductions available call or text me. I’ll get you started down the path to ownership.

Lessons Learned – Buying Orcas II

Back again! It’s now September of 2001 and I’m off to Orcas Island to hunt for property. Let’s take a moment to talk about a few things I should have thought about before I started looking.

Orcas, as you’ve probably already figured out, is located in the Pacific Northwest. Summer days are long and warm.  As a summer visitor from San Diego one tends to forget the flip side of that benefit, the short, cold days of winter. Orcas is mountainous. During the winter the north sides of Mount Constitution, Pickett, Entrance, Willard, Turtleback, Buck, etc. receive significantly less light than the south sides.

Mount Baker
Mount Baker

There are a large number of tall trees growing on the island. These factors should be considered when planning to purchase a home in which you intend to live during the winter. I’m not suggesting that you eliminate a home on the north side of a mountain. But it could be a consideration if you are trying to decide between two homes.

The economy on Orcas is tourist-based. If you plan to rent out the house when you aren’t vacationing, expect very little income. You might consider turning the property into a vacation rental but there is a down-side to that also. I’ll talk a little more about renting in a future blog post.

Okay, back to Orcas and hunting for property versus sitting on a log at North Beach drinking in the view.

North Beach
North Beach

I’ve found a couple of vacation rental condos available in Eastsound. They have a fabulous view of the water, a live-in property manager to handle all the details of renting and are well within my budget. The market analysis indicates rising values. Everything looks attractive except the limitation on how much I can use the place myself.

While I agonize over my decision it is brought to my attention that a certain family member will be heartbroken if I don’t at least look at the home they have for sale. The price is a smidgen above my comfort price but well within my qualification. I figure it wouldn’t hurt to at least look at the place.

And now we come to my first mistake. I fell in love with the view. I’m certain that I was manipulated into a visit at sunset. The sky was a palette of color ranging from deep blue to gold to bright orange. I could see sail boats off the northwest shore and the Canadian Rockies in the distance. In front of this was a perfect view of one of my favorite places on the island, Madrona Point.

Who wouldn't fall in love with this view?
Who wouldn’t fall in love with this view?

What color was the carpet? Don’t know, wasn’t installed yet. Did the roof leak? Don’t know, wasn’t finished. Decks were in the process of being built. You could not inspect the foundation because the crawl space was filled with junk. Appliances were sitting ready there ready to install. Lesson learned, make sure the work is complete before you close escrow. And have a second inspection to be sure the work is completed properly.

I wrote the offer anyway. I thought that since this was a purchase from a family member I was reasonably assured that the work would be completed with good attention to detail so I skipped the second inspection. Unfortunately the contractor they hired didn’t install a critical flashing. Years later I faced an expensive repair. Oh and maybe you should spend a little time looking at the house instead of the view. Just a thought.

Stay tuned for things I’ve learned about home inspections. Or if you are ready to start your property-hunting adventure call me at 619.224.9015 and we’ll get started.