Retire Early and Travel

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

Sunday, July 5th, 2009

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!

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The Travel Planning To Do List – still growing….

Friday, July 3rd, 2009

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……:)

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