In a previous blog post, we discussed the various types of income property uses and which may be the best fit for buyers. (Read Part 1 here.) The uses to consider are second home, short term, long term or seasonal rentals. We previously discussed short-term rentals. Below, we take a closer look at seasonal and long-term rentals.
Seasonal rentals work well for owners who predominantly use their property during one season but not both. Usually single family home owners are the types of owners who have the properties that are attractive to seasonal rental tenants. For example, Florida and Texas owners love the mountains' temperate climate during the summer and head to Aspen to escape their states' heat and humidity. Yet they may not be ski or cold-weather enthusiasts. Therefore, renting their property during the winter season may work best for them.
The other factor that may cause a property owner to rent seasonally is when they do not need to use their property during any one of our two desirable seasons and can give up the use of their property longer term. They can net more income with lower commissions for long-term rentals and fewer overhead costs incurred by short-term rental turnovers.
Potential buyers do need to know that Aspen summers have been are more desirable for seasonal rentals than winter the last few years. Aspen's winters are longer and demand higher nightly rates (for non-luxury properties). This has driven many owners to limit winter seasonal rentals in favor of short-term rentals to maximize revenue during prime weeks.In the past, when rates were lower, frequent visitors liked the convenience of keeping their summer seasonal rental vacant in the winter, so they could come and go to while leaving their personal belongings and skis to make the travel easier.
There is a large demand for long-term rental condominiums, townhomes, duplexes or single family homes in Aspen and Snowmass. The types of long term renters you can expect include the following: those who want to try certain neighborhoods before buying; those who want to make sure Aspen is a place they are ready to invest in; those who are current owners who are remodeling and need a place during construction; or divorce situations where one needs another home and wants to stay here.
There is a small supply of these types of properties that are available for long-term rentals because most people who buy property here do so to use it. However, if an outside factor requires a homeowner to seek out a long-term rental, they can expect to receive about three percent of the property's value in gross rental income.