Most people who buy a vacation home do so, of course, with the idea of spending as much time as possible there, they choose the perfect spot to spend their free time, and a house they absolutely love. Many others think of it as an investment, the opportunity to make money with your vacation home in Costa rica along the way, but how do you turn your vacation home into a cash cow ?
We’ve all heard the two sides of the story, the successful home owner whose vacation home has turned out to be a wonderful investment, and the horror story of someone who bought a property that has only given back headaches.
What key elements make the difference?
Like with any other investment it is very important that you consider all the aspects about your vacation home in Costa Rica:
1) Buy in a popular vacation area: This should be obvious, right? And by choosing Costa Rica you’ve already made the first good choice; but many times, we are tempted to buy a vacation home in a hidden beach or in the mountain in middle of nowhere, with this choice you are limiting your options, it will not be as easy to rent. Popular vacation sites guarantee a constant flow of people interested in renting out a home; there is demand, which also means you can play with your price during low and high seasons, however, you must also consider that each vacation site appeals to a different crowd, for instance, the crowd that vacations in Jaco or Tamarindo is usually different from the one that vacations in Nosara or Papagayo, one is a younger crowd or looking for more of a party scene while the other caters more to middle aged couples and families or even retired couples that have more spending power, and this key aspect is one you can’t overlook. You can check out our list of 10 best places to buy a vacation home in Costa Rica .
2) Target market: Who are you looking to rent your house to? If you want to turn your vacation home into a cash cow you need to understand who your target audience is, renting a luxury house overlooking the beautiful beaches of Guanacaste can cost thousands of dollars a day and tens of thousands per week. Costa Rica has been attracting more and more upscale European and North American tourists that usually are willing to spend on comfort, luxury and service. If you think of your vacation home as an investment you will be wise to choose the best house you can afford, if you need assistance with this, you can check out our article on Buying an Affordable Vacation Home in Costa Rica.
3) Buy the right house: Consider the pluses your property will have in comparison to similar rentals or hotels in the area. The best way to go about this is trying to be as objective as possible, put yourself in the shoes of a renter and think what would make you choose one house as opposed to another; comfort, security, location, convenience, price?. Vacation rentals have become very popular due to the number of advantages they offer in contrast with a hotel, AirBnB wouldn’t let us lie. The house’s style, amenities and size play an important role too.
4) Value the advantages of buying a property within a project or residential community: Owning a vacation home is no different than owning any other property, in the sense that it requires maintenance, from the garden and security to house cleaning, you will need someone to be your eyes and ears and help you with all aspects of the house up-keep and rental. Buying within a residential community has the advantage that it usually includes maintenance and an administration office that will help you handle basic things; others like Kalia Living in Nosara for example will provide you with professional property management, vacation rentals service and even concierge service; which means you have someone that will handle your home maintenance, will help you rent your home short or long term and even satisfy additional requests through a personalized concierge service, and you are dealing with a dependable and responsible company. No headaches, no unexpected problems. Buying in a community also gives you an aggregated value with the many amenities offered.
5) Plan ahead: Yes, many vacation home owners have a problem renting out their homes because they don’t plan ahead. Costa Rica has the advantage than even during the “low-season” the weather is usually great, especially in the Guanacaste area, so perhaps you can plan your time in your vacation home during the low season so you can make it available during the high season and make the most of it. Grab a calendar and mark off the days or weeks you want to use your home; and accommodate your renters on the remaining weeks; always leave a couple of weeks free in case you need it for yourself, guests or even to just do some maintenance or remodeling work, keeping your house fresh and in great conditions is a must.
6) Advertising your rental house: Create a simple website or a Facebook page, take great photos of your house, it’s amenities and the surrounding areas, a great description with all important details of the house is imperative, there are a number of listing sites where you can include it, make sure they are relevant to Costa Rica and make sure you have some security measures in place. Going through your property manager, respectable rental company or residential property management service, if you have access to one, is probably the easiest way to keep your property busy and working for you and is also the safest way to go about it.
Lastly, establish a fair market price, talk to your property manager, do some research and consider all the selling points your home offers.
With all these elements under control you should be able to easily turn your vacation home in Costa Rica into a cash cow while at the same time enjoying it yourself with family and friends.