Realtor · West Michigan · Member since 2017 · 105 posts · 53 votes
My husband and I are contemplating purchasing a condo or small house in one of the desert cities (near Rancho Mirage/Palm Springs/Indio/etc.), that we would enjoy in the summer half of the year and then rent to snowbirds during the winter half of the year. If I'm understanding the regs correctly, if we only rent for 30 days+, we don't have to list as an STR and pay all the crazy high occupancy taxes, right?
Anyone having success with focusing solely on the Snowbird market? What websites work best for advertising? Or, is it best to get in with local realtors for promotion?
Would love to know if the Snowbird market is crashing due to Covid-19 worries too....
Hi Rachel, a couple of thoughts. Might be too soon to tell about the seasonal snowbird market, my sense is that it will remain strong though Canadians may be less inclined to travel south this year. For the TOT tax on STRs, on most platforms this can be a rental pass-through depending on the city (ie: some have a relationship with Airbnb to collect from renters on your behalf other cities you can set the tax rate and they need to remit to the city). Either way the short and mid terms have been strong through the summer in the desert, to me the premium income and flexibility makes the extra effort worth while...
@KevinMurphy - thanks for your thoughts. I was just thinking it would be simpler to just do the Snowbird only rentals, especially since we would want to use it ourselves in the summer. I was thinking the Snowbird monthly rentals could just about cover the whole mortgage payment for the year (on the right property, of course).
We already have an STR in western Michigan, so I know how to manage one through AirBnb and VRBO. But, I also know it's a real time commitment too! ;)
Hi Rachel, while I do STRs for my investment property in the desert, the longer term rental market should be strong. I do know others who focus on long term (30 day +) and do very well. Something you may want to consider when selecting the location (some cities don’t allow short term rentals and many HOAs don’t allow short term either). I wouldn’t fully rule out short term rentals as it can be a great revenue driver if you aren’t booked for a period of time. This summer the market has been booming and with everyone locked down I do think more people will want to escape to warmer weather for the winter months. Feel free to reach out if you have any specific questions as I’m familiar with the area!
I think that's a great strategy and one that can do really well. As some may have mentioned, the desert has been mostly a destination for STR's. I'm seeing a strong interest in the area for medium term to long term stays (2-3, 6 months, 1year etc) but this can partly be driven to the pandemic and people's ability to work remotely. As far as snow birds, the winter time is a very popular time and there is demand for long term rentals during this time but with the pandemic and travel restrictions, I'm not sure how that will fair out at least for this year. With people traveling habits and work routines changing, I think this mid term stays will be something that will continue in some form in the future. With longer than 30 day stays, you avoid TOT, turnover, less work and restock of supplies etc that you find with an STR. I wouldn't completely rule out STR because there are months typically March and April that more lucrative than others. So if you can find a place that allows that flexibility that's a good thing. I will have a 6 month furnished lease on one of my places coming up in the next month. I'm considering a hybrid approach going forward during the year of STR and medium term leases.
As a Canadian snowbird, I’ve heard rumours that the borders will be closed for the rest of the year and could change moving forward as well.
I think it’s a fabulous idea, but proceed with caution and have a backup plan if the borders remain closed or have complex quarantine regulations that would deter snowbirds from leaving home.