Renting Out the Cottage

23 March 2011 About The Finances

Handing over the cottage to renters can help out with cabin expenses but it takes some serious planning. Before you decide to list the lake property for rent, decide why you want to rent out the cabin, who you want to rent to, how much money you need and when you want to make your summer retreat available.

Cottage Rental Advice for Owners

Why Rent Out The Cabin?
People rent out their cottages for a number of reasons.  It may be a necessary financial decision, either planned or sudden.  Some owners buy a cottage early in their professional lives, rent it out for a number of years to cover the costs and then have it for retirement.  Others get caught by an unexpected change in their income level or cost of living.  If you are planning to sell the cottage, a private sale to a renter is advantageous for all parties.  Many cottages are held purely as investment properties that the owners never use.  Regardless of the reason, it is important to plan properly and discuss the decision with the whole family.

Who Should You Rent To?

The last thing you want to deal with is problem renters at your cottage.  After all, this is your retreat from the hectic life in the city.  Screen your renters carefully.

Extended Family
Extended family members can be a good option for finding renters if you have the right relationship with them.  When you decide to list the cottage for rent, don’t be shy about considering extended family as possible renters.

Friends of Neighbours
Word of mouth is often the best and cheapest way to find renters for the cabin.  Let your neighbours at the lake know that you plan to rent out the cottage.  If they are uncomfortable with the idea of strangers being at your cottage they may do your work for you to find someone they know who would be interested in renting your cabin.

Strangers
Renting to complete strangers is very risky.  You may find wonderful people who take better care of the place than you do, or you may get complete lunatics.

Couples
Renting to a couple without kids may be the best option if you have a small cottage or cabin.  They are often looking for a quiet place to get away and are unlikely to cause grief for you or your cottage neighbours.

Families
Small families are a good choice if your cottage suits their needs.  Safety for children is always a concern so be sure to fully inform them of key points of interest.  With a bit of luck, you may get reliable families that will rent from you for years.

Groups
If you have a larger cottage, you have to be careful of big groups.  You are better off trying to rent to families who can afford to pay more, than to a group of twenty who are looking for the cheapest cost per person.  Besides the obvious risks to your property, you also risk being kicked off the lake by your cottage neighbours.

How Much Should You Charge?

A number of factors have to be considered when determining how much you will charge when you rent your cottage.  Taking time to do the numbers is important as you may find out that the net gains are not worth the trouble.

Cleaning Costs
Someone has to clean the cottage before your guests arrive, and after they leave.  Whether you pay someone or you make an extra trip yourself, the expenses have to be factored in.

Advertising
Newspaper and Internet ads can add up if you don’t get your place booked quickly.

Maintenance And Repair
Even if you have the perfect guests, there will be added wear and tear on your cottage, the equipment, appliances, etc.

Utilities
Gas, electricity, firewood, water and even Internet access all have to be provided and paid for.  Most guests will want these costs included in the price.

Insurance
You have to let your insurance company know that you plan to rent the cottage.  There may be extra fees added to your policy to cover increased liability, damage, and theft risks.

Agent Fees
You can hire a third party to look after some or all of the work related to renting your cottage. These services are not cheap but may be worth the convenience.

Your Time
You may spend a lot of time trying to find people to rent your cabin.  Advertising, responding to questions, getting deposits, giving directions, meet and greet, cleaning, etc. will be time consuming and may not justify the amount of money you get.

Your Neighbourhood
There is a limit to how much you will be able to charge.  This depends on the location, size and modernity of your cottage.  The net benefit has to justify the costs.

When To Rent Out The Cabin or Cottage

How often have you decided at the last minute on a Friday evening or Saturday morning to make an unplanned trip to the cottage?  Maybe it was a tough week at the office.  Maybe the weather was going to be perfect.  Maybe your neighbour called to say the fish were biting. 

Whatever the reason, you were able to go because you knew the cottage was available.  Be honest about what that freedom is worth to you.  Avoid letting greed get in the way of your leisure time when you decide how many weeks you plan to make your cottage available for rent.

If you must rent out the cottage to make the numbers work, consider making it available during the peak summer season. You will be able to charge higher rates and can avoid the busiest weeks on the lake. If your vacation schedule permits it, you may decide to pull the kids out of school for a week in the spring or fall to make up for the time that you plan to rent out the cabin during the summer.

Make A Cottage Information Kit

An information kit about the cottage should include all the details that a prospective renter might want regarding all of the things that are included with the cottage. You want to get the right people. The more information they have at the beginning, the less likely they are to call you after they arrive.

Go to the Advice for Cottage Renters page to see all the items that renters should be asking you about.

List the maintenance equipment, kitchen appliances, the bathroom facilities, consumables, indoor and outdoor furniture, local rules, emergency numbers, interesting historical sites and local events.

Be specific about property location, water depth, and the number of stairs from the dock to the cottage. If the property has a steep slope, you must tell people about it.

Itemize the recreation equipment that is available and permitted for renter use.

Summarize the presence of wildlife both in and around the cottage. When people know they may see a mouse in the cabin, they are less likely to complain when one appears. If you have resident skunks or porcupines, the renters should know this in case they decide to bring their dog.

Set up a simple website to show off your cottage.  It is a great tool to help advertise your lake property while allowing potential renters to get most of the information they need before deciding to contact you.

The website should include recent photos, a calendar showing availability, pricing information, a copy of your rental agreement and contact information.

Renting out the cottage can be a successful and stress-free experience if you take the time to plan it properly.

Need more Cottage Real Estate Advice?
Go to the Cottage Selling page.
Go to the Estate Planning page.

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