Rental Properties: The Good, The Bad and The Weird Owners and prospective buyers of Incline Village and Crystal Bay real estate will often contemplate whether or not it is valuable to consider doing vacation rentals or putting their property on a long-term lease. Vacation rentals are generally defined as any rental for a period of 29 days or less while long-term leases are normally considered to be for any length of time between 30 days and one or more years. Many long-term leases are structured with an initial rental period of one year followed by either a one year renewal or a change to month-to-month tenancy. When you are considering doing any type of property rental it is usually predicated on a number of factors such as the anticipated annual income, wear and tear on the property, whether to offer it furnished or unfurnished and the economic benefits to be gained by forgoing the use of your property for a particular length of time.
Generally speaking, long-term rentals will generate a higher and steadier flow of income than all but the best vacation rental properties. However, doing vacation rentals still provides you with the opportunity to use your property a significant amount of time during the year when it is not occupied. Anyone who has rented their property for a long period of time will usually have stories to share about the good, the bad and the weird situations they have encountered over the years. While it might seem nice to rent your property on a one year lease and avoid the turnover that occurs with vacation renters, finding a great tenant can sometimes be a challenging experience. Not every tenant on a long-term lease is going to treat your property with kid gloves or maintain it in the pristine manner that you deliver it to them on move-in day. If you can find a tenant who enjoys maintaining your property with the same care and pride of ownership that you have, then it can be a win-win situation for everybody. Good tenants will keep a property relatively neat and clean, report repairs and problems in a timely fashion and will not offend the neighbors by creating any type of nuisance. They will also pay the rent on time every month and sometimes even handle minor repairs on their own without troubling the property owner.
When it comes time to renew the lease, it’s much easier for property owners and rental agents to feel encouraged to continue with a good tenant who has shown a high degree of responsibility during the previous year of the rental agreement. But not every tenant falls into this category. Some renters will treat the property with slightly less concern than a cheap motel room. It’s not unusual for a less than stellar tenant to ignore reporting repair items to the rental agent or property owner for months at a time thereby reinforcing the old adage that an ounce of prevention is worth a pound of cure. What started out as a small leak from the drain pipe under the kitchen sink can turn into an expensive repair job when that trickle of water makes its way through the floor and into the ceiling below or down into the adjacent walls. And that’s just for starters. Occasionally, after a tenant moves out property owners will discover all sorts of damage including holes in the walls, doors yanked off their hinges, broken appliances, torn or stained carpets and even the disappearance of furniture or appliances. And then will come stories from the neighbors about how loud, inconsiderate or the outrageous behavior the tenant exhibited that you as an absentee owner would never have been aware of. And some renters are neither good nor bad but just plain weird.
One of my roommates in Davis, California many years ago decided that the basement of the home we were renting would be the perfect place to perform his senior research project which was breeding giant Burmese pythons. Never mind that he was majoring in wildlife and reptiles along with having a fair amount of experience with handling his pet boa constrictors and other exotic animals. Buying three pythons ranging in size from 5 feet long up to 9 feet and breeding them to produce a few dozen babies was a whole new ballgame. Even though he and his lab partner built two high quality cages and lined the basement with chicken wire to prevent the snakes from escaping, it was always a bit unsettling whenever the hatch to the basement was opened and the snakes removed from their cages for playtime. The project was successful and the 80 or so eggs produced by the two females resulted in 40 live births and their ability to study the Burmese python reproductive cycle. While their professors may have been enamored with their ability to breed giant Burmese pythons in captivity thousands of miles from their native habitat I can only imagine what the landlord would have thought if they had come to the house for an annual inspection of the property. If you are thinking of renting your property on either a short-term or long-term basis it’s good to have an understanding of both the positive and negative factors affecting your decision.
While the extra income is nice it has to be weighed against the possibility of extraordinary expenses and additional repairs that may result from permitting others to occupy your property. It’s impossible to be absolutely certain upfront whether a tenant will be good, bad or simply weird. But engaging the services of a professional rental agent or property management firm can go a long way towards making it a positive and rewarding experience for everyone involved.