Podcast - 7/28/23
🏠🎧 Renting or Selling Your House: What's the Best Move? 🤔
Tune in to our latest podcast episode! 💡 We discuss the pros and cons of short-term rentals (STRs) versus selling your house. From managing reservations to dealing with regulations, we cover it all. 🎙️🏡
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of Jay Day and the Day Home Team of Real Estate Teams with our weekly real estate podcast. We do it, we put a new one up every Friday. What's up this week, Jay?
Well, besides it being the end of July, which is scary enough, the summer is,
Oh no, please be. No. Merry Christmas, buddy. I haven't gotten you anything yet.
I was going to say happy Valentine's Day to you.
Oh, man. It's going so fast.
I'll bring you some flowers and chocolates.
Oh, we will cover ourselves because before you know it, it'll be February 14th.
Oh, yeah. Oh yeah. So one of the things, the trends that we're starting to see, and I wanted to chat about a little bit, is we're having some sellers that are thinking, should I sell my home? Or because I have my low interest rate, should I consider keeping it and renting it? Because again, with having these low interest rates, they could turn it into a potential profit center. Some of the things that I just wanted to point out, and people that are doing Airbnb, VRBO, things like that, the rentals are down dramatically this year from where they were pre-pandemic. And I think it's just because one airline, airfare is super expensive compared to what it was. And I think all those extra funds that were being handed out and gave people extra cash and then also seeing how expensive things have gotten sort of hit people in their pockets.
Well, when you say these rentals are down, do you mean the number of rentals are down or the demand for.
Okay. I see.
Demand. We're looking at 25 to 30% drop in what was in bookings from year over year. So that's one of the things I wanted to mention. And also, one of the other things that a lot of people don't realize with the short term rentals, and again, I can speak of it a little bit because we have one as well, ours is out of state, but it's actually a lot of work if you're going to try and do one and stay in the area and you think you're going to manage it yourself. I mean, there's times we have two, three different groups coming through in a week, and every time that happens, you've got cleaning, you've got laundry, you've got housekeeping stuff. I mean, checking for damages. It is a lot of work. So if you are going to do that, I think property management is a way to go. And our team does not do property management at all before the short term rentals. It's almost a must because we've had people that have single family homes and I'm like, remember, you now have to have, your lawn has to be taken care of. You're not there to keep an eye on it. If you have a pool, you've got to deal with that situation. It's a lot to handle. And one of the interesting things too, one of our friends out in Washington State, they had purchased something and they're in the business and did not remember, or did not even think to look at the HOA covenants. So they built one, they were having it rented, and then someone complained. And when they read the HOA docs, they were not allowed to have short-term rentals.
You're talking about a short-term rental or somebody signing a year lease, you're talking about something different, right?
Short-term like Airbnb, VRBO.
Okay. All right.
And so Lake Linganore, we've had investors reach out to us and show interest in that because it has amenities. And then I've had to point out to all of them that it's in the HOA and it's covenants. You are not allowed to do short term rentals.
Yeah, sure. I would imagine that'd be the first thing that you would check.
Yeah, because otherwise, I mean, even with Lake Linganore, their rules are, you can't even, so forget the short term. We know that can't happen. Let's say that you're living in a house, your kids move out, you've got way too much space, and you're like, I'm just going to stay here. House is almost paid, and I'll rent out the basement. That's not allowed either. So you're not allowed to rent out rooms.
No kidding. No kidding.
Wow. I mean, I guess you could maybe sneak it, but it might not be worth it.
And I mean, ultimately, if it's never a problem until somebody complains, but you don't want to be in the situation where you have somebody complain and think about it, if you're surrounded by all these people that live in the house and it looks like you're having transient stuff happening, of course people are going to be concerned about the safety. What's happening, what's going on in the house. People may not even think that it's being a short-term rental. They may think there could be illegal drug activity or something. It's just a safety concern because you don't know who's coming and going.
I do know that my sister in California, some of her neighbors have done this, and they don't care for these Airbnbs being in their neighborhood.
Yeah, most people,
They don't care. These people coming in and raising hell then leaving.
Oh yeah. It's a different world.
And do people ask you about that as an option these days?
They do. Oh, absolutely.
And more than let's just say, hey, I'm just going to rent my house. I want to do this Airbnb deal.
And I mean, one of the other things we tell 'em too is you have to think about where are you and what is the appeal? So for example, if you're, let's say you have a home in Brunswick Crossing, what is going to draw people to that area? They're going to want to, downtown Frederick is charming. There's people that like to see things like that. Gettysburg with ghost tours, some places where you can see.
Got to be something. Yeah, you got to be a draw there.
Yeah. Lake Linganore, I understood why people thought it could be appealing because there are beaches. You can go kayak. There's a lot of different things that are there, but realistically, most places it doesn't really make that much sense. Parts of West Virginia, if you've got something on the river, different story.
Up in the mountains, cabin in the woods.
But there's a whole lot of other parts that people don't think. And then for those that aren't looking short term, long term, there's a lot of rules and regulations on that too. And I can't get into all the specifics on this, but I will tell you, based on the county you're in, most counties in Maryland, you have to have that property registered. If it was built prior in the early seventies after 79, you're going to have to have lead certs done where they're having to inspect. There's a whole lot of extra things that need to happen. You can't just say, I'm going to advertise my house for rent on Facebook and see what happens. There's a whole lot of regulation around what's going on. And the counties have these rules where they want to make sure that one, you're not going to have slumlords and having people stay in places that potentially are not safe.I mean, a lot of people in downtown Frederick got really upset over the last, I think it was a year, year and a half where they made some changes where the homes in downtown Frederick had to have certain things done to them, even though the tenants might've been fine living there the way it was. And what ends up happening, the owners are going to have to do all these renovations and repairs, and that's just going to cause the rent to go up and make it unaffordable for people. So I would say the big thing is, if you don't know whether you want to rent short term, long term or sell, reach out to us, we can talk about the pros and cons of all. If you do decide to do short term, we can, again, it's ultimately up to you what you want to do. Our job is just to give you the facts and give you the ideas to know what you need to think of, and we can connect you with someone who can help handle that. We also don't do rental management for long term, but we can connect you with someone for that if that's what makes the most sense for you. And it all depends. I mean, we lay it out to people. Here are all the options, and if you're interested in doing this, great. And I tell people I'm doing it. I have a management company that does mine down in Florida. Again, it's a vacation spot. It's right on the Gulf of Mexico. You can see the water. There's a private beach there. There's so many things that draw people there. But I also keep a pulse on what's going on with these. And so many people have converted properties into short term rentals that it's the total opposite of what we've seen in real estate sales, where now there's so much supply really, and the demand has dropped. So now the people that have them are having to drop their rates to be competitive. And sometimes when you get to a certain number, it may not. Do you really want to have transient people just staying in one or two nights.
That's why we do these podcasts.
So if you guys are thinking about any of that, you could always reach out to us. 866-702-9038, and you're ready for the house of the week.
Give us the home of the week.
All right. 480 North Teal Road in Martinsburg, West Virginia. If you've been on the hunt for the perfect home, I'm telling you this one, is it. It's a detached single family, three bedroom, two and a half bath, move-in ready, totally updated, all new floors, light fixtures, bathroom vanities, kitchen counters, appliances, you name it, it's been done. It has an open floor plan. There's a two story family room, a fireplace, deck, large fence yard, all of this for 325, just right in Martinsburg. If you want to check out what the home looks like, go to wfre.com. Look up Tom and Jay's Real Estate podcast. You'll be able to see photos there. If you like what you see, click on a button and we can get you in for a private tour.
Jay Day and the Day Home Team of Real Estate Teams with our weekly real estate podcasts. Thank you for listening and tell your friends all about it.