Short-Term Versus Long-Term Rental of Your Investment Property in Mexico
One of the things to consider after you have purchased property in Mexico is whether you´d like to rent it out. Earning some money from your new investment can go towards paying off any funds that were borrowed to make the purchase or simply serve as a profitable side business. So the question invariably leads to whether you should look at short-term rental (also known as a vacation rental) or long-term rentals as the way to go.
When you are renting out your house or condo for a few days at a time (or even a weekend) this is referred to as a short-term rental, or vacation rental. In general this would usually apply to tourists or visitors from out of town who are looking for an alternative to staying in hotels or purchasing a vacation package. You will likely rent out on a weekly basis, or even offer nightly rates. In Playa del Carmen it´s common to charge double or more during peak holiday seasons like Christmas and New Year’s Eve, where demand is quite high. This also applies to popular festivals like BPM in January which tends to draw groups of people who are looking to save on expenses by sharing a house or condo.
In the case of long-term rentals you would be renting your place for an extended period of time, with tenants typically signing contracts for 6 months or 1 year. There are many advantages to this, the most obvious being that the monthly payments become a source of steady revenue that you can rely on. As an owner you would obviously be limited in the amount of use you can get from your own property, so when it´s your time to enjoy vacation and are hoping to get some time in your home you might be out of luck.
Read the rest at The Yucatan Times
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