Short Term Rental

What is Short Term Rental?

One of the most cited reasons for buying a condo hotel over other forms of Real Estate is that it is maintenance free or "hands off". While this is true, a condo hotel is not the only form of Real Estate in the Orlando area that fits that criteria.

Short Term Rental is defined as renting a home for a period less than 1 month. In essence the home is rented in the same way as a condo hotel, except typically in week long increments.

Some communities have onsite management companies and are almost identical to condo hotels. Other communities have offsite companies which act in the same manner as a condo hotel management company except without the onsite check in/ check out.

What are the benefits of Short Term Rental over a Condo hotel?

Financing

Condo hotel financing has become more difficult as the credit crunch worsens, and down payments have steadily increased from 10% down to in some cases 50% down necessary to procure the property.

Short term rental properties are considered "conforming" which means that down payment requirements of 10% are quite common.

Value

Condo hotels are typically more expensive to build and as such cost more per sq. ft. than short term rental properties. Here is an example

World Quest 2 bedroom condo hotel 1286 sq. ft. $350,000

vs.

Encantada 4 bedroom townhome with pool 1570 sq. ft. $270,000

Management Costs

Typically a condo hotel management split will work out to 50/50. Some may be 60/40 with a monthly fee, but after all is said and done most work out to 50/50

Most short term rental management companies charge between 20% - 30%, thus requiring fewer days rental to get to that sought after break even point.

Take a look at some of the short term rental communities like Encantada or go to our sister site www.mbthomes.com for more extensive inventories of communities featuring short term rental.

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