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Michael Heraty
Managing Broker
    Years of Experience: e-Pro Certification

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Rentals

Can I Make Rental Income With My Home? (Part II)

Monday, January 19th, 2009

In order to market your Pagosa Springs rental you will also want to consider how you may integrate your vacation rental program into all of your work, social and family networks. If you are employed by a large firm, you may be able to generate plenty of business by marketing your Pagosa Springs rental to folks within your company. You will also need to have a relationship with a local handyman and housekeeping service. There are qualified people within Pagosa Springs that can take care of these tasks for you.

If on the other hand you do not want to be directly involved in the management of your Pagosa Springs rental property, you may contract with one of several rental management firms in Pagosa Springs. They will take care of the pricing, marketing and management and provide you with a monthly report of all rental activity, revenues and expenses for the rental. The fees charged for rental management are set by each firm; you may pay anywhere from 25%-50% of the gross revenue. You will need to check with the management firms directly. Some questions you may ask as you interview management firms would be: How many rental units do you currently manage? How long have you been in business? How much income do rental properties similar to mine generate annually? What are your fees? Are you insured with liability as well as errors and omissions coverage? Can you provide me with three references among your existing and past clients?

Renting out your Pagosa Springs vacation home can provide some extra income to help offset property taxes, insurance and maintenance expenses. Your accountant can explain the guidelines you will need to follow in order to maximize the income tax advantages of the rental program. Please give us a call at Pagosa Source to discuss rental programs or anything related to real estate in Pagosa Springs and Southwest Colorado. As always, your discussions with us are without cost or obligation and remain strictly confidential.

Can I Make Rental Income With My Home? (Part I)

Monday, January 19th, 2009

We are often asked about the rental income potential within the townhome and single family home market of Pagosa Springs. Owners that are using their properties on a part time basis as second homes sometimes consider renting them out while they are not using them. This can be a nice means of generating some rental income to help offset some of the costs of ownership. Like most mountain second home markets, the short term rental demand in Pagosa Springs is highest during the peak seasons when most owners wish to be using their homes. Christmas, Spring Break, Thanksgiving, Memorial Day weekend, Fourth of July week, and Labor Day are all “high season” in Pagosa Springs rentals, and as such, these are the periods when you can generate the highest daily rental rates. For retirees that are empty nesters, giving up peak periods may be very workable. For families, their vacation use generally evolved around school schedules so renting out their property during high season in Pagosa Springs may not be feasible.

If you do decide you want to earn some income from your Pagosa Springs rental, there are several things to consider. Do you want to place the property under professional management, or handle the rentals yourself? What are some of the tradeoffs between the two approaches? If you rent out your property in Pagosa Springs, what is a reasonable expectation as to how much revenue you may earn? What are some of the income tax considerations of renting out the property?

First, handling the Pagosa Springs rental program is not as daunting a task as it used to be. I once managed over 600 single family homes and my wife Lauri and I managed high-end vacation rentals at Keystone Resort when we were first married. Today, with the use of the internet, you can do a good job of marketing your Pagosa Springs rental property and save yourself a considerable sum over what professional management costs. You will want to study up on the most effective web sites for vacation rentals and develop and continually update a dedicated web site for your property.

Market Recap

  • Avg. Sales Price: $258,000

  • Avg. Days on Market: 230

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