Many of us who rent our homes out on the Cape and Islands are tempted each year to fill our otherwise vacant rental homes during the off season if we can. After all, the prospect of bringing in even a little rental income is better than nothing, right? Not necessarily. Here are a few things to consider before you decide:
If you are unable to enjoy the use of your rental home in the off season yourself, it’s just sitting there and could provide you with additional rental income. Even 50 cents on the dollar, compared to your summer rates, could come in handy. And most homeowners require winter tenants to pay for their own utilities, unlike in the summer when the owner is responsible for all utilities.
Some people make ideal winter tenants. Occasionally, a family might be looking for temporary housing while their own home is being built or remodeled. Or a teacher might be on sabbatical and looking for a place to stay for the winter. These people tend to be very respectful of their rental home. In addition, you will now have built-in caretakers who can watch over your home, which would otherwise be left empty and vulnerable.
The bottom line is, your rental income is drastically reduced from what it is in the summer, and your expenses and risks can increase. There are so many vacant homes on the Cape and Islands in the winter, driving rental rates down to a mere fraction of their summer counterparts.
In addition, tenants settling into your home on a long-term basis are, without question, harder on your home. As the expression goes, “Familiarity breeds contempt,” and your tenants might become less concerned about treating your home with care the more they settle in. In a weekly, summer rental, vacationers are outside most of the time and barely unpack or even cook in your kitchen. But during the long, dark hours of the winter, they spend much more time in the home, living normal, busy lives, resulting in more wear and tear.
Yes, some of the stories I’ve heard from homeowners who rented in the winter have been ugly: walls and floors badly damaged, heavy trash all over the yard, broken furniture, doors and windows. Another risk for Massachusetts properties is that our laws here make it exceedingly difficult to evict a tenant, especially if there are children in the home. If a winter tenant refuses to move out in the spring, you could risk losing your valuable weekly summer rentals, or at least the precious time needed before their arrival to clean and prepare your home for them.
If you are looking for a long-term winter tenant, do some due diligence before you commit to renting. Unlike a summer tenant, who is in and out of your home in a week, this tenant will be there for months. To reduce your risk, be sure to:
- Meet the potential tenants in person at your property to show them around, answer their questions, and ask some of your own.
- Ask for references, both personal and business, and speak to these references.
- Call the prospect’s employer to verify that he/she works there and for how long.
- Pull a credit report on the prospects. You can also Google their names.
- When you’ve found a tenant, be sure to use a comprehensive, long-term lease that fully spells out the details of the agreement. Your short term summer lease is not sufficient.
- Periodically check in on the tenants, perhaps stopping by to pick up the monthly rent. That will give you an idea of how your tenants are taking care of your home.
- Require a higher security deposit than for a weekly summer rental.
Do you have any experience with long-term, winter rentals? If so, was it good, bad… or ugly?