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How to Rent Out Your Timeshare for Extra Income
Renting out your timeshare for extra income doesn’t have to be complicated. Contact Timeshare Defense Attorneys for a consultation!
How Do Timeshare Rentals Work?
The biggest disadvantage to owning a timeshare property is the ever-rising expenses. As a timeshare owner, you may have considered renting your timeshare to cover your annual costs. You may also be looking to make some extra income.
If you’re planning to rent out your timeshare, you need to consider the following:
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The competition in the area
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Your pricing
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Whether to use a rental agency or not
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Preparing a written rental agreement
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Marketing the property
Managing a timeshare on your own is generally not easy and, in most cases, you will not earn enough money to cover the annual costs.
It is important to note that not all timeshare owners are allowed to rent their timeshares. It is, therefore, important to check your buyer agreement to determine if you can legally rent your timeshare.
Can I Rent Out My Timeshare?
Your timeshare ownership type determines whether you can rent your timeshare. If your timeshare is deeded, you can rent it out. However, non-deeded “right-to-use” timeshare contracts prohibit rentals. Check your contract carefully; if you are unsure, call the timeshare developer to confirm.
Do not rely on oral representations made by the timeshare sales team at the timeshare presentation. Most salespeople will pitch timeshares as excellent investments, implying the possibility to rent and profit.
Once you have established that your agreement permits you to rent out your timeshare, you may start setting your financial goals for the rental.
Can I Make Money Renting My Timeshare?
Before renting your timeshare, you may want to explore and set your financial expectations.
Timeshares are not generally vehicles of investment, nor are they set up to make money or earn a passive income for their owners.
If you manage to cover the annual costs of your timeshare by renting it out, you may be fortunate.
Step-By-Step Guide To Renting Out Your Timeshare
The timeshare rental process can be fairly easy, depending on how you decide to go about it. Here’s how you can do it in four steps.
Decide How You Will Manage It
When you decide to rent your timeshare, you can choose to manage it yourself or hire a rental company to do it for you.
Self-management involves a lot of work, and all responsibilities will fall on you. However, you will get to keep any earned revenue from the rental.
If you use a rental company or estate agent, they will charge you a fee for their services. The fee may be so high that the rental will become unprofitable. Consider weighing your rental agent’s expenses against the potential revenue carefully.
Self-management is most feasible when you live near the timeshare location. Since this is unlikely, you should consider who will meet the renters on arrival, hand them the keys, and attend to the property when they leave to ensure everything is in order.
The following are some questions you need to ask when considering self-management:
- How will I handle the reservations, check-in, and room availability?
- Who will draft the rental agreement?
- How will you market the property?
- Who will handle the check-in and check-out?
A rental company can take care of these challenges for a fee. Since this is their bread and butter, they are set up with all the necessary processes and templates to take the burden off your shoulders.
Unless you are physically in the same location as your timeshare property, it may be better to use an agent.
Choose a Timeshare Rental Management Company
If you decide to use a timeshare rental company, you’ll find many services out there to choose from.
To filter out the best service for you, you can talk to other timeshare owners who have used an agent before. You can also check out vacation rental websites and read through their reviews. Avoid companies with no reviews like the plague. Scam artists abound in the timeshare industry.
Also, check the company’s website to assess what they provide. If you’ve shortlisted any, contact them and ask lots of questions until satisfied. Make sure that they:
- Have access to your target market,
- Have genuine operations, and
- They are physically represented or located in your timeshare location.
Ensure you know the rental market value of your property. You don’t want the agent to rent your timeshare at a lower rate than it is worth.
Have clarity about all expenses and decide whether the agent’s fee will render the rental non-profitable. If everything goes well, sign a written contract.
Work Out Your Rental Rate
You need to assess all your vacation property costs and ensure your rental price can cover them.
For your nightly rate, factor in your annual maintenance fees, the cost of hiring the rental management company, and any other expenses.
Remember when doing market research to compare apples with apples. Your rental expectation should align with rental prices of similar properties and amenities in the same location, perhaps even at the same timeshare resort and in a similar timeshare week.
Next, you need to research the local market. Will your proposed rate attract customers in the competitive environment?
Your daily rent price should be reasonable and accurately reflect the current market’s prices. However, it should also cover your expenses, at least partially.
Market Your Property
If you have decided to manage your property yourself, reaching out to potential renters is your responsibility. This can be more difficult than it appears to be initially. Placing ads in printed media costs a lot and may make renting unfeasible.
Social media and online marketplaces can be harnessed, but be very cautious of scammers and thoroughly double-check all potential customers.
If you hire a rental agent, they will be responsible for marketing it on your behalf.
How Timeshare Defense Attorneys Can Help
Our skilled team of timeshare attorneys can evaluate whether your timeshare contract permits you to rent it out when you cannot use it.
If you do find tenants, we can make sure you have a watertight contract so you don’t end up liable for tenant misbehavior. We are familiar with all the issues which arise from poorly drafted contracts and will provide you with a fair but firm contract.
Many owners tire of their timeshare resorts and start looking for exit options. One option is to contract a timeshare exit company. Others may consider abandoning their dues. You may be wondering, what happens if I stop paying my timeshare?
Our team at Timeshare Defense Attorneys can answer all your questions. Skilled timeshare lawyers can help you get out of your timeshare contract. We have years of experience negotiating with timeshare developers on behalf of our clients.
Contact us today for a free case evaluation.
