Retire Early and Travel

Your Home: to rent out or not to rent out-that is the question!

Author: Vanessa

We thought about, mulled, discussed, wrote out a "pros and cons" sheet, decided to, not to-it is your home, how do you rent it out to strangers without feeling worried about coming home to a war zone?

The obvious pro to renting out your home while you are away is that is the most viable way to enable you to work and travel from anywhere in the world. The rental income received can pay your mortgage, bills and even, if you time it correctly, it can pay for part of your rent overseas. For example, we are traveling during peak summer season in Australia and fortunately, we live 30 metres from a very popular beach and holiday destination. So the rental return during this period is quite high.

We are also traveling to live in countries where it is shoulder and low seasons so I have negotiated very good deals at all places as people want long term (3 month) rental income during economic down times and low seasons. People are very accommodating and will include such extras as: free internet, linen, car space, heating, extra weeks for free etc. You don’t know if you don’t ask! I will tell you my tips and tricks on this one at a later date.

So after searching around for some time (days) and checking availability, prices on both executive rental and holiday rental, understanding costs of site listing, cleaning, management, reputation, my husband and I sat down to assess my spreadsheet. Basic Pros to Executive rental: no calls in the middle of the night by renters looking for the iron, not able to get the television working, they look after key exchange, checking for bond after tenants move out, linen and cleaning service provided, they take responsibility for quality of tenants, and, best of all, they find longer term renters so wear and tear on your home is less (minimal I hope!). Cons: lower rental income, no holiday rental time increase, they take a substantial management fee, you have to be ‘approved’, you have to comply with a ‘rental list’ of items included in your rental property (who uses egg cups anymore…?!).

Ok, so Pros for Holiday rental: higher rental income, lower number of tenants, you can negotiate for most amenities or extra inclusions, they are more flexible on timing (you can control their dates). Cons: potential calls in middle of night for items not working, not found, required, if keys are lost you need to arrange for someone to provide new ones, you need to ensure you have hired/found someone to check at the end of their stay for damage/lost items to enable bond return, provide keys to new tenants, arrange cleaning at end of all stays, ensure any required items are replaced…..it takes alot of co-ordination and if you are overseas, you are best to and it is highly recommended that you hire a friend or trusted person to look after this and assist you. It is ALOT of work.

We decided to go with the executive rental option. For our first time, we thought we would need more time to organise a suitable manager, were wanted to do some research into our opportunities to holiday rent our place and what sort of prices and interest we could achieve. So I found a good site to put our apartment on for holiday rentals to see what sort of interest was generated.

Take it from me, the holiday rental experience can be a trying one. The site I choose does not permit you to deal directly with the client sending an enquiry, however you are able to send a message through the site to the person enquiring. We have had several enquiries since putting our ad on the site-really promising and within 3 weeks of setting up our ad, we could have rented our apartment already for all but January (which I have no doubt would be easily taken/reserved before we leave in Sept).

The enquiries from holiday renters can be frustrating. For example, our apartment is not suitable for small children. It states this on the site advertisement. However, one particular enquirer has a 6 month and 2 year old coming from the UK. They are requesting 2 weeks in November. They have put in the first request at a price less than the advertised price minimum. When I responded stating it was not suitable, they came back again and asked if they could post a higher bond. I responded by stating that we have many dangerous, low, glass, pointed items of furniture which we have had ‘incidents’ with friends small children (and we have had several!). They posted a new quote of $5 per day more. I again, stated it was not suitable but thank you for your enquiry. They came back again with the same price quote and one extra day. I again, stated it was not suitable for young children (at this point the nightmares began with 2 year old children wetting through our Space furniture designer cream coloured couch/bed in the spare room). I can hear some of you reading this thinking, you want to rent it, you take the chance, it is the price you pay for the lifestyle you want, not fair to people with small children etc etc…but it our HOME. And it is the first time…maybe we will become more relaxed in future years but ….and really, we have NO facilities for small children. Some holiday homes have highchairs, cribs, playpens…ours does not. Just dangerous furniture.

So it is still continuing. We are still going back and forth with this particular request, I continue to state that our home is not suitable for small children, the woman continues to request our apartment. And we continue to pack and prepare for our adventure ahead as we feel it coming closer and closer…….

And we are both still feeling slight trepidation some days, excitement other days, overwhelmed some days, just want to be gone still other days….but after just having brunch on the beach with friends today and seeing and feeling their excitement for us, we walked home hand in hand knowing we have made one of the best decisions of our lives. This is just the beginning of an amazing lifestyle that we always dreamed of….now it is here!

July 5th, 2009  |  Posted in Retire Early Finances  |  14,103 Comments »

The Travel Planning To Do List – still growing….

Author: Vanessa

Today I feel the world is going by too fast. I am now realising how little time we have left to do a very large number of things to prepare to go away-and everyone wants a piece of us! We don’t have enough time to see everyone (weekends away, dinners, lunches, drinks…) let alone do all we have to do to be prepared to leave on time.

I am certain and have no doubt in my mind that the second time we do this-go away, live and work elsewhere for 6 months, it will be much easier. I have started to compile an ever growing "to do" list – both for personal items and in order to enable us to rent our home as a corporate executive rental. I am not sure at this point, which list is longer. The corporate rental of our property is priority at the moment to enable the rental agent to have time to list and find tenants for a minimum 3 month period.

We discussed the pros and cons of renting our apartment as a holiday rental and decided that, for the first time, we would go with the executive rental (I will write a post specifically on the pros and cons of this at a later date!). But despite the fact that we picked the easier option with a manager to assist (less work and money than holiday rental but more easily orchestrated!), there is still A LOT TO DO. And surprisingly, this list, the personal "to do" list , working and incidental last minute items are all mixed with friends wanting to see us ‘before we leave’!

We have less than 10 weeks left and we are both getting nervous: about the amount to do and little time left, about the adventure itself and about making it work well-not just ‘work’. The ‘to do’ list priority for this week is the apartment, to ensure we have that set up as soon as possible is fundamental at this point. The manager/agent requires a minimum of 6 weeks to let the apartment for the date we leave and most rentals are 3 months so we would need to be ready to leave at the beginning of September. They also need new photos of their own, despite the wonderful website we have set up with everything including a video, to ensure the look and feel of their website is maintained. They also have provided a list of things to ensure we have in the apartment for rental use. This means I need to buy some items which are either not in our apartment or which I have but don’t want to use for rental tenants. At least the inspection and some packing is done! Next is Landlord insurance….

The personal "to do" list grows by the minute with everything from Travel Insurance, to International SIM cards for our phones, to overseas bank account options, to UK travel cards, notifying the electoral roll (almost forgot this one!) and professional memberships, organising our cars, car insurance, landlord insurance….it seems endless! But it will be better next time (I seem to keep saying this to myself…) and will make the whole experience more enjoyable (I keep saying this to myself also….!). This is combined with more friends and family booking themselves in to stay with us at the various country venues…..I am having trouble keeping track!

But the main thing I realise and the most important is: KEEP FOCUSSED: on the goal, on the dream and on the job ahead. You can’t be distracted by everyone around you wanting something, including you. You need to keep your eye on the goal and ensure you don’t waiver from the path. You only get this chance once to make it happen right so do it right the first time! And everything else and everyone else will fall into place……:)

July 3rd, 2009  |  Posted in Travel Planning  |  Comments Off on The Travel Planning To Do List – still growing….

Financial Institutions – they should institute themselves!

Author: Vanessa

The other day I spent 2.5 hours on the phone with institutions. I am trying desperately to have one bank -who-shall-remain-nameless-but-are-the-only-bank-in-the-world-living-in-the-dark-ages-St-George stop sending the 5 (yes 5) pieces of mail each month to me. My husband receives another 2 statements. Please note: we also receive these on-line. I patiently wait through 3 different client service people and finally arrive at someone who will listen. I receive the standard response-it is a compliance policy requirement. When I ask why they are the ONLY bank in the world of finance that has this requirement and I DON’T WANT any mail please, I am told it is a compliance requirement. I ask why and am told they don’t know.

At this point I have been on the phone with the bank for 1 hour (being passed around) and cannot comprehend this ‘requirement’ and really just want to understand if my mail can be held/stopped/not sent for a period. I am again passed around and finally told (after being cut off twice) that I will receive a call back from a manager of Customer Service who will respond within 72 hours. That was 96 hours ago.

I am really just trying to impart the fact that you need to start all this process early. It is NEVER too early. It all takes longer than you think!

I am still awaiting the insurance company response to our query on how to either amend our home contents insurance policy to cover other people renting our home or whether we require an ‘add on’. I have received, to date, 7 different responses to the same question. Beware of this as insurance companies are renowned for finding a ‘glitch’ that you have not notified them of which negates your claim. In other words, ensure you have a clear statement from the Insurance company stating you are fully covered for damage to contents by renters in your home (and not just fire, flood etc).

Also just organised our international SIM cards from GoSim. I found it is a really good idea to contact the company you find on-line and ask questions e.g. how much are calls/sms texts from one GoSim card to another, what are the costs to and from the countries you are visiting or likely to call/text as they are often not specific on the site and make a difference to the cost of the SIM card. I found that when I asked questions, I was not aware of a special offer which was buy one, get the second at half price Manager sale. The GoSim support team were great and responded quickly and immediately and suggested the best offer for our circumstance. They have been really good-but whomever you use, ensure you contact them and ask THEM for the right offer for you. They often know a lot that you don’t/won’t/can’t from searching on-line.

Also found an expat forum called Expatforum.com which is good for information and asking questions about the countries you will be living in e.g. issues in the city-opening bank account tips, local info on food, culture, meeting other people, schools. It is a great idea to know what you may be up against or need to know before you move. The more you are set up before you go, the more you will fit in and feel at home!

June 29th, 2009  |  Posted in Retire Early Planning  |  Comments Off on Financial Institutions – they should institute themselves!

Travel Planning: Regroup and Focus

Author: Vanessa

We both get nervous, don’t doubt this. It is a big move mentally. And emotionally. Which is why sometimes you have to step back and look at the other person (or people, or mirror….) and remember why you are doing this. And ensure you do it smartly. That is what gives you the confidence back. The goal, the dream and the smart path. As I have said before, the first time is the hardest and each year it gets easier because you know the path, have done it before and it is half trodden for you.

We do have mini meltdowns from time to time, wondering if we are doing the right thing but happily it is at different times, it is not often and we regroup, discuss it and refocus. We are a great support system for each other and have to remember this. This really is the chance of a lifetime to build the dream lifestyle, working from anywhere in the world we chose, working when we like during the day and being together. And we both work hard and are happy to continue to do so to have all this.

Today our goal was to finalise as much as we could on the apartment rental to ensure we would not have to worry about mortage payments and bills while we are away. Every day that I go to the mailbox outside, I hope there is less mail. Each time we receive a piece of mail (I seem to get more than my husband X 5…) we try to call/email/contact the sender to have it forwarded next time by electronic means. This saves money on redirecting mail while you are away. Plus you have the luxury of vetting the mail and deleting it without being reliant on someone else or doing it when you come back!

We also had a handyman come in to clear a list of items we had compiled on our apartment, including installing a lock on a cupboard so that we could leave some items in a large cupboard locked up. The rest will go in our garage lockup. It is good to look around your home with an independent eye and clear up any outstanding or broken items as well as doing the items you have ‘been meaning to get to’.

I also started a list of items to buy for the rental of our home as I don’t want people using our ‘precious’ items or breaking things that have sentimental value. Also, things such as linen and crystal may not be something you wish to leave to chance with rental clients.

Finally, I listed our apartment with our website on the best holiday rental property site I could find that looked reputable and did not cost much. This is research for us for next year. We also paid for Google ad words to see what kind of interest we could drum up for a holiday rental in the event we decide that financially it is better to rent our home for a shorter period but more $. There is the hassle of a bond check, cleaning, queries etc but if we plan in advance (this was more last minute this year!), we can organise for someone to assist.

I have done a spreadsheet on the best international and local holiday rental sites and cost and we sat down and discussed where our money would be best spent.It is tricky to decide where your eggs are best laid but when it comes down to it, it is a bit of luck but mostly time well spent in marketing well. More on this later……:)

June 25th, 2009  |  Posted in Travel Planning  |  1 Comment »