Long Term Rental Archives - Enso Connect Inc.

What is rental arbitrage?

Sasha Barak — Mon, 22 Mar 2021 15:00:00 +0000

Rental arbitrage is one of the easier ways to get into the Short Term Rental market. In essence, Rental Arbitrage is the process of taking a Long Term Rental, and subletting it into several Short Term Rentals. There are several upsides and downsides to this model that make it appealing for some and risky for others. For starters, the company Sonders’ whole operation is based on the premise of rental arbitrage. But what does this mean?

Getting into the short term rental market

Rental arbitrage is an instance of getting into the Short Term Rental market without putting much “skin out there”. If you are someone with limited finances and cannot afford your own property, but are wanting to work in the Short Term Rental market, this may be your best option. The ability to take a Long Term Rental and turn it into your own Short Term Rental gives you the flexibility and ability to do so. However, the implications of fluctuating travel and rental occupancy may scare you away.

With the COVID-19 pandemic, many arbitrage businesses went belly up due to the fact that rental prices that were locked in were much higher than the revenues that could be received through Short Term Rental markets. As many people haven’t been able to travel, these Short Term accommodations have not seen their full potential, and the high locked in price can shut down many young property managers.

Where rental arbitrage can succeed is when the year long lease cost is less than the potential revenue generated by short term solutions. In a time like this, if you’re looking to make money, and currently have money, locking in a long term rental could be a good option. If you are okay with losing some money initially (due to lack of travel), you could lock in a property that has lower than average rent, but then leverage that for arbitrage later on as the pandemic restrictions fade.

Rental arbitrage in essence is a gamble. Like any other fluctuating market, you have to have some capital saved just in case your idea doesn’t go to plan. If you have capital and believe the pandemic restrictions will be over sooner than your landlord believes, then your current rent agreement may be a God send. Leveraging your current rental rate for the future for Short Term Rentals may mean a successful rental business.

At the end of the day, rental arbitrage may or may not be for you. If you have your own stories about arbitrage that you want to share, please email contact@ensoconnect.com to have them shared. If you have any questions, you can also email us, and we will try to give our best opinion on your situation.

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What is holding your rental business back?

Sasha Barak — Mon, 22 Feb 2021 16:00:00 +0000

What is holding your rental business back? What limitations do you currently have that didn’t before? Has anything changed recently that has affected your properties’ business? All these questions are ones you should be asking yourself from time to time to see how you can grow your business. If you are able to analyze how you are currently running your business, you’ll get a better idea of what steps you need to take in order for it to grow.

Understanding Your STR

So, what limitations do you currently have? Besides anything out of your control, what aspects of your properties can be improved so that it can grow? If you’re finding yourself so busy that you can’t see your family, it may be time to analyze what your properties are requiring you to do. If you’re someone who likes to be in control of everything, you may be feeling a bit burnt out, and may be needing someone to come in to help you out. Special touches that you incorporate into your properties like personalized cards, or welcome presents don’t have to disappear, but when you ask others for help, you’ll be able to maximize your time better.

If you do have multiple people on your team but still feel overwhelmed, try and pinpoint what aspects you’re overwhelmed with. Does it have to do with the booking process or does it have to deal with the maintenance of the building itself? By understanding your problem, you’ll have that much more of a fighting chance to solve it quicker. If you’re realizing that you’re spending a lot of time cleaning your properties, try and consider hiring a cleaning service. Go through your properties and jot down every aspect of the property that you think should be cleaned and which ones should be thoroughly cleaned. Give that list to the cleaning service, and see how they do. If they’re up to your standards, then terrific, if not, it’s still not the end of the world. There are many cleaning companies out there and I’m sure you’ll find one that would be able to fit your needs.

If you feel that your property management business is growing faster than you anticipated, stand back for a second and take note of what things you need for the future. If you’re growing rapidly, make your needs larger than you think so you don’t get stuck in this bottleneck again. Growth is good, but growth with a plan is even better. Figuring out what areas need improving, people you need to hire, or even what you want to change about your properties are all things that will need to be taken into consideration at one point or another.

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What is travel etiquette?

Sasha Barak — Thu, 21 Jan 2021 14:00:00 +0000

Etiquette, like many other things, can set you apart from others. Having great etiquette can not only improve other people’s perception of yourself, but also give others a reduction in stress and hassle. When traveling abroad or renting a vacation home, etiquette should be at the front of your mind. Although a rather simple concept, etiquette, like most other characteristics in life can greatly affect the others around you, and traveling is no different.

Being Etiquette When Traveling

The basis of travel etiquette is essentially to leave things the way they were if not better than the way they were before you saw/interacted/experienced them. If you were to rent out your home or have friends stay over at your home, I can guarantee that you would appreciate it if they made the bed in the morning, or cleaned up after themselves. These little touches — although not very time or energy consuming — end up going a long way in people’s minds. It is this sort of thinking you, yourself, have to consider when you are traveling abroad.

Keeping surfaces clean and organized and caring after the wellbeing of the property are all ways that you can respect your host and the place you’re staying in. These qualities not only set you apart from the other guests, but they also make you appreciate where you are staying, as you then create a physical connection between yourself and the location. During the process of traveling, being a respectable person who isn’t blasting music or making a mess along the way will make a better impression on the local residents and will make them more comfortable with more travellers coming to their destination.

Essentially, etiquette is a key focal point in day to day life and you may not even realize it. It’s the small things that make someone’s life easier that can really change the way people go about their normal day. Although travel etiquette is paramount when traveling or staying abroad, social etiquette is something that can be practiced almost anywhere, and will make a sincere difference in someone’s day.

Social etiquette and travel etiquette go hand in hand, as travel etiquette is a natural extension of the latter. There are thousands of different “horror stories” from property owners and other hosts alike. People that not only disregarded etiquette, but mistreated their surroundings to such an extent that these hosts are forced to reimagine their rental practice. Being proactive, and following your hosts’ guidelines, while also trying to make things easier for them, is a great way to welcomed back again.

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Should you switch your Short Let Stay to a Longer One?

Sasha Barak — Tue, 17 Nov 2020 14:00:00 +0000

If you’ve been contemplating transitioning your short-term rental into a long-term rental, you’re certainly not alone. Many rental property owners are feeling the pressure of ongoing pandemic-related challenges and evolving regulations imposed by Online Travel Agency (OTA) sites that are increasingly favoring longer-term stays. For instance, cities like Toronto, Canada, have implemented regulations requiring property owners to register their short-term rentals if they are rented for stays shorter than 28 consecutive days. Such regulations can add a layer of complexity to managing your property and might make the transition seem overwhelming and confusing.

However, there’s no need to worry. While these changes can initially appear daunting, they also present an opportunity to reassess your rental strategy and potentially benefit from a more stable rental income. Long-term rentals can offer more predictable revenue streams and reduce the frequency of guest turnover, which can be advantageous during uncertain times. Additionally, adapting to new regulations and market conditions can help ensure your business remains compliant and competitive.

To navigate this transition smoothly, start by researching the specific regulations in your area and consulting with local real estate experts or property management professionals. They can provide valuable insights and help you understand the implications for your property. Additionally, consider evaluating the financial impacts of switching to long-term rentals and how this might affect your overall business strategy.

By staying informed and proactive, you can make well-informed decisions about transitioning your rental property and continue to manage it effectively, regardless of the changing landscape.

Determining whats needed for long term rentals

Let’s first figure out what you would need to do to make the transition. With longer term rentals, comes a greater time commitment to the property and your guests. Right now, you are probably used to having many guests for little bouts of time, with the extension of your guest’s stay, you have to figure out how to change the way you run things. As you will be taking less guests, you’ll need to make sure that the guests you end up choosing are exactly who you want in your rental for an extended period of time.

Asking good questions from your guests, and making sure that you have a set of rules that you want your guests to adhere to. With longer term stays, you will most likely have a greater involvement in the property management, as now it is just one guest that will be accessing your facilities. Structuring a well thought out rental agreement can give you and your guest the peace of mind that’s needed whenever renting a property.

From choosing the right guest, and making sure that they follow your rules, you’ll now have to pivot the way you rent your property so that it’s more long term friendly. With short term rentals, you tend to focus on the key features of your property and the sights nearby. With longer term rentals, many guests will be looking for proximity to transit, restaurants, grocery stores, etc. Make sure to update your listing accordingly.

From there, also evaluate what you currently have in your property. Are there any items that you think are missing? The last thing you want is to have a long term guest not being able to make coffee because of a missing coffee maker. Making sure your rental is properly equipped will allow you to be less directly involved in the maintenance of your property.

Also, with longer term rentals, you will be receiving more consistent income because of the bookings. However, with the increased amount of days booked also increases the utilities. Make sure that your rental rates are reflective of the increase in utility usage. At the end of the day, determining whether you want to switch to a long term rental is completely up to you. One key thing to note is the difference in experience. There will be more involvement on your end, as you are transitioning from a property manager to a landlord. When switching over your rental, there will always be something new to consider, but like always, if you have any questions feel free to email contact@ensoconnect.com.

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