A last-minute rental can be an unexpected goldmine for a vacationer and a pain in the pocketbook for a second-home owner.
What’s the best way to fill surprise cancellations on your rental schedule, especially when they come during a premium time of the year like Labor Day weekend?
Second-home owners who rent out the best weeks of the year to help make ends meet or to pocket extra cash handle bombshell calendar gaps in a variety of ways. Here are some of the most popular methods:
1. Never underestimate the last-minute shopper. Just because your longtime renters who always reserve Labor Day weekend have an illness in the family and can’t make it this year, don’t panic. There are many people who peruse "last-minute specials" online and who can drop what they are doing and vacation at a moment’s notice.
In fact, there’s a contingent who expect to find last-minute deals on weeks or weekends they targeted long ago. They do look for bargains (and you obviously plan a reduction in price because of the timeframe), but don’t let them grind you into the ground.
Bargain-basement shoppers who want even deeper discounts tend to complain about everything once they are in the door. Set your bottom-line rent and don’t dip under it.
2. Trade the time for work needed. Perhaps your cabin needs a roof repair or deck addition. Laborers have been known to trade part of their fee for afternoons in the sun with their families. Inquire about the chance of your roofer working during the morning then relaxing with his wife on the lake at cocktail hour.
3. Look offline and local. The power of the Internet clearly may be the backbone of your rental network and structure, but it’s not the only way to get things done, especially in your own community.
For example, the church bulletin (even if you are not a weekly member of the congregation) is one of the best inexpensive, local advertising outlets that targets high-probability prospects for very little cost. Marketing your property in the church bulletin lifts you to a bona fide status because you are helping to bring in revenue for the parish and at the same time indicating that your getaway is of a standard that would be acceptable to those who gather with you. The church bulletin brings a pride factor not present in other mediums. Local groceries and drug stores also have popular bulletin boards that net surprising results.
4. Pay back or pay forward. A last-minute opening can offer a terrific opportunity to thank a family for a special favor or gesture. It can also be a once-in-a-lifetime vacation for a family that simply doesn’t have the funds to get away. Why not surprise a staff member at work or an incredibly helpful teacher at school? Random acts of kindness have ways of paying off big-time.
5. "If you ever get an opening …" Make a list of the people who have said they would love to use your place if it were ever available. Your second home may have the reputation of always being occupied, so an opening in the schedule may be a bonus to your family and friends.
If you don’t want to charge them the market rate, have a "friends rate" that is palatable to both sides. Most of the time, the "friends rate" will be viewed as a bargain because they probably know what you charge during prime weeks of the year.
6. Plan a work week/weekend. If you can’t land a renter and don’t want to reduce your rates more than you already have to find one, pack up the paint brush and cleaning supplies and take care of a deep clean sooner rather than later. Days spent maintaining the house do not count toward the personal-use limit. And you can deduct travel costs to get to the house and expenses such as paint and cleaning supplies.
Under current federal tax laws, the owner can still use a rental vacation home for 14 days or 10 percent of the amount of time the house is rented, whichever is greater, without jeopardizing its status as a rental property and tax shelter.
Prime-time cancellations can be a huge letdown. However, take time to ask yourself, "What’s possible?" before throwing up your hands and letting the place go vacant.