There are some things about the vacation rental market that are legal benefits and you will want to know about them before you get involved in renting a home as a vacation rental.
- Contract / reservation Contract. If you rented an apartment using a regular lease, drop it off. Here's why. Leasing gives you a tenancy and could literally take months to evict a person from your property, depending on the eviction process and location of the property. Instead, use a catering contract that legally allows you to impose an immediate departure for breach of contract. Make the first page of a booking agreement as an app so it feels more like a privilege than a sales pitch. This sets the tone for respecting your business and your assets.
- Deposits. Consider not taking deposits. If you accept credit cards, enter something in the contract that allows them to charge their credit card for damages that exceed normal usage. A damage deposit is usually not enough to cover most of the damage; and the costs of collecting and returning damage deposits are elusive. Buy deposit insurance through an insurance company, allowing you to file a claim for damages (up to $ 1500) with your insurance company. You charge a $ 50 non-refundable fee; which covers insurance costs; and earn some extra profit to boot!
- Holiday insurance. Offer your guests a vacation rental insurance, which covers situations where the guest may have to cancel the rental refund. Compensation is heavy in this business because for the time period during which the holiday booking was booked you could not rent it. Even if you do, the work doubles for the same amount of cash flow. Offering vacation rentals (up to 7% of rental costs) will bring you a small extra income. Include a disclaimer that if they decide not to buy insurance that a refund will not be possible. That way, if you get a guest who wants a last-minute refund and tries to come up with a reason to terminate the contract, you can direct them to the insurance company to file a claim; or you can remind them that they have given up buying holiday insurance.
- Local hospitality taxes. Many cities are still unaware of holiday accommodations and do not consider them taxable. However, some cities require you to be licensed or certified; other cities require a hospitality tax payable if your rental is 7 days or less. Make an informed decision about how to handle your hospitality tax.