Investing in rental properties, especially beach condos, can be a profitable venture if done correctly. Hitech digital sources uncovered the great potential for vacation houses in tourist hotspots, leading to a surge of owners renting out their second homes.
Due to the 10% year-over-year vacation rental market growth rate, seafront condo owners are expected to make $28,000 – $48,000 by renting out one bedroom for the whole year! If you want to know how to make money with a beach condo, read on!
A seaside condo is more marketable to holiday goers than a beach house thanks to the built-in amenities, compact design, and breathtaking views from the upper floors. Also, if you target the summer months only, the property will have minimal wear and tear, meaning you don’t have to spend much on maintenance.
How Does a Beach Condo Bring Good ROI Through Summer Vacationers?
Travelers’ interest in privately-owned vacation homes created a vacuum of rental properties, followed by 60% of short-term travelers in 2022 booking their stays 2–5 months earlier.
Similarly, the significant rise in renters of seaside properties in summer seasons ensures that the owner can make an 8-10% ROI after averaging the income with the colder months.
A scenic beachside condo can become an investment property if the owner makes intelligent decisions to market and overlook the property. Compared to other destinations, a beachfront condo ensures a steady income stream thanks to $113-$450/night (depending on the amenities and location) during summer with an 80-90% occupancy rate.
5 Ways to Make Money with a Beach Condo
1. Renting Options
The rise of vacation home platforms made it easier to diversify the renting options. Digital media helps condo owners sell out the summer slots to short-term renters, 5-6 months before the booking.
Since short-term tenants ensure flexibility, you can take care of the condo and reduce the maintenance cost.
The post-pandemic workplace legislation assisted employees to WFH, opening doors for digital nomads and workationers. Opening doors to renters looking for prolonged stay became easier as online platforms started offering options – “Long Term Stays” by Airbnb, “Work Friendly” by Booking.com, and so on for remote workers.
2. Reasonable Pricing Strategy
Beach vacation housing has two seasons, high season (Summer) and low season (winter). The first thing to do is set strategic pricing based on season and rental duration, short and long-term, to get the best return for a seaside condo.
Since winter sees fewer tourists at the waterfront properties, market the property as a deep work hub for remote workers looking for a serene space for a few weeks or months. Proper planning allows beach condo owners to sustain themselves throughout the year while maxing out their income in peak summer months.
Last year, Linda Sanders, an owner of a luxurious condominium in Daytona Beach, FL, encountered difficulties in securing a renter at a rate of $1000 per night. However, after lowering the price to $500 per night, she experienced an extraordinary turnaround, as her property got booked for the entire summer within 48 hours.
Setting a reasonable pricing strategy for a beach condo involves several key considerations:
- Market Research: Identify similar properties in your area or the same building and see what they are charging for rent.
- Seasonality: Beach areas are often highly seasonal, meaning demand and rental prices can vary significantly throughout the year.
- Costs: Calculate your costs such as mortgage payments, condo fees, insurance, maintenance, cleaning, and any services you’re offering such as utilities, internet, etc.
- Profit Margin: Determine your desired profit margin.
- Additional Services: If you offer additional services like a cleaning service, concierge, or included activities, this can justify a higher rental rate.
- Flexibility: Monitor your bookings. If you’re booked solid months in advance, your prices may be too low. If you’re struggling to get bookings, they might be too high. Be prepared to adjust your rates based on demand.
- Length of Stay: Consider offering a discount for longer stays. This can reduce turnover and make management easier.
Also, if you buy a pre-construction condo, that’s going to save you quite a hefty sum. Explore the condominiums allowing for short-term rentals, such as condos for sale in Downtown Miami, and you’re in for quite a revenue.
3. Promoting the Condo Amenities
No matter how affordable your pricing strategy is or how beautiful the nearby attractions are, you can’t expect a decent payoff if the potential guests don’t get a prelude to the condominium’s amenities.
If you are lucky enough to be the proprietor of a million-dollar luxury seaside condo, you should promote the lavish in-house amenities, such as the jacuzzi tub, spa, pool decks, poolside cabanas, dance studios, massage rooms, pet care center, and many more.
With proper representation on short-term rental platforms, families with kids will lean toward the condo instead of a hotel as condos have a collection of homely features- connected room, washer, dryer, cooktop, and microwave. Also, the strategic location of luxury condos near downtown draws nearby residents looking for a weekend gateway.
4. Digital Marketing and Software
A seaside condo owner can use many platforms to optimize sales, accounting, and marketing. Digital marketing through blogs and reviews creates an international customer base, while bookkeeping lets the condo owners maintain the property without staying in the vicinity.
Digital marketing strategies include:
- Creating a website with high-quality pictures, details about the property, pricing, availability, location, nearby attractions, and contact information.
- Optimize your website for search engines (SEO). This can help your website appear higher in search results when someone is looking for a beach condo to rent in your area.
- Use platforms like Instagram, Facebook, and Pinterest to showcase your property.
- Collect emails from interested parties and send them regular updates about your property, special offers, or interesting information about the local area.
- List your property on popular vacation rental websites like Airbnb, Booking.com, VRBO, etc.
- Write blog posts about the local area, things to do, the best times to visit, etc.
- If your condo has extra amenities like massage rooms and a gym, make sure you include this in all digital marketing!
Vacation rental software (such as Guesty, Lodgify, or Tokeet) assists owners by saving time and getting more visibility without risking overbookings. Also, the owners save time through automated guest communication and build a reputation over time.
Other software tools can include:
- Channel managers to help automatically update availability and prices across all platforms when a booking is made.
- Tools like HubSpot or Zoho CRM can help you track potential renters, communicate effectively, and improve customer service.
- Tools like MailChimp or Constant Contact can help manage your email campaigns.
- Buffer or Hootsuite can help you schedule posts across multiple social media platforms.
- Use Google Analytics to understand the performance of your website and the behavior of your visitors.
5. Cozy Interior
After a long day of summer sports, water activities, and evening walks, tourists seek a place where they recharge and get a good night’s sleep. Creating a seamless indoor-outdoor access connecting the sea and natural colors in the living quarters in the condo will make your guest extend their vacation or return for a second vacation.
Since people’s tastes change over the years, creating a comfy and flexible interior is crucial. Adapting to the trends in the home office, lounge areas, and bedrooms can help appeal to your target market for your rental properties.
Some ideas include:
- Choose a Calming Color Scheme: Opt for colors that reflect the seaside environment. Soft blues, sandy beiges, and white can create a calm and welcoming atmosphere. A pop of bright coral or seaglass green can be used as an accent color.
- Use Natural Textures: Incorporate elements like jute rugs, rattan furniture, wicker baskets, and wooden elements. These textures give the space an earthy, beachy feel and add interest to the decor.
- Opt for Comfortable Furniture: Choose plush, comfortable furniture that invites your guests to relax. Consider slipcovers for sofas in light or neutral colors, which are not only cozy but also easy to clean.
- Let in the Light: Make the most of natural light to make your space feel open and airy. Use sheer curtains or shades that let in plenty of light while still providing privacy.
- Add Cozy Accessories: Throw pillows and soft blankets in your color scheme can add comfort and coziness. A plush area rug can make the space feel warmer and more inviting.
- Keep Decor Minimal and Relevant: Less is more when it comes to beach decor. Opt for a few tasteful beach-themed pieces, such as artwork featuring local scenery, decorative shells or driftwood, or nautical-themed items. Avoid cluttering the space with too many knick-knacks.
- Create an Outdoor Oasis: If your condo has a balcony or outdoor space, make it comfortable with outdoor seating, a small table, and maybe some potted plants. Outdoor string lights can add a magical touch in the evenings.
- Lighting: Besides natural light, layer your lighting with ceiling lights, wall lights, and table lamps to create a warm and cozy atmosphere. Use dimmable lights where possible for flexibility.
- Provide Essentials: Ensure your condo has all the essentials such as high-quality bedding, enough towels, a fully equipped kitchen, and other basic amenities. The more comfortable and at home your guests feel, the cozier the atmosphere will be.
- Personal Touches: Adding small personal touches like a welcome basket, local guidebooks, board games, or a book collection can make your guests feel at home and add to the coziness of your condo.
If you are looking at how to make money renting condos, the above should help you get started. Rental properties around the seaside area are giving traditional hotels a run for their money. As Statista predicted an annual growth rate of 11.08% from 2021 to 2025 for vacation rentals, beach condos are expected to see more business in the coming years.
So, venture out with your seaside condo, which ensures a great ROI thanks to the in-house amenities like pools, pet permission, gym, spa, and many more.
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