The 2008 market crash took quite a toll on many homeowners throughout the country. However, there is one positive that came out of those poor conditions in the end.
There is one good thing that came out of the 2008 real estate crash. I’m talking about the growth of the vacation rental market.
As recently as 2000, most homeowners had no intention of renting their second property. However, following the housing bubble and subsequent crash, many homeowners couldn’t afford the cost of a second home. At the same time, selling via a short sale or foreclosure in the depressed market following the crash would have meant taking a big loss. Many owners of vacation properties started renting them out part-time to cover their own costs. This has changed the entire real estate market when it comes to vacation rentals.
Is this a good thing? I believe so, and here are three big reasons why:
1. Vacation rentals are good for owners. Did you know that 42% of vacation homeowners today cover the entire cost of the home through renting and the average vacation rental nets an 11% yearly return? The ability to rent is now becoming a justification to buy, and around 20% of vacation homeowners list investment as their primary reason for buying.
2. Good for guests. A vacation home offers guests a better, more interesting experience than staying at a cookie-cutter hotel. At the same time, a vacation home is often more affordable. Research from Harvard and MIT found that as many as 63% of Airbnb stayers would not have stayed in hotels. Instead, many would have cut their trip short or not traveled at all.
3. Good for communities. This might sound a bit controversial because some communities balk at the growth of vacation rentals and the changes they bring. However, an increase in vacation rentals are good for communities, and not just because of the money flowing in. Having more visitors changes the dynamics of a community for the better, making dormant neighborhoods interesting year-round—not just during occasional peaks.
But what does this all mean for you?
Perhaps you’ve been mulling over the idea of investing in a property around Phoenix yourself.
If you want to take a look at current homes available on the Phoenix market which would make a good vacation rental, or if you want to discuss what you should be looking for and which homes around Phoenix would make a good fit, give me a call or send me an email today. I’m here to help.