Should I Rent my Smith Mountain Lake Home??

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In this article I will focus on the various “pluses and minuses” of renting your SML home. To learn about the specific rules for renting short term at Smith Mountain Lake (and this is a very important topic), please watch this short video (7 minutes) I recently posted to You Tube: Home Rental Rules at Smith Mountain Lake

By “rent” I am talking about short term rentals, like Airbnb and VRBO vacation rentals.

If you are a prospective buyer, understand that if you MUST have a rentable Smith Mountain Lake Home, you will significantly limit your selection of available homes to buy; less than 50% of homes at SML are rentable. So, as limited as the available home inventory is right now (August 2023), if you go to only rentable homes, that inventory gets cut in half (more than half actually). Just something to keep in mind.

But let’s talk about some advantages.

Advantages of renting:

  • At a minimum, renting will defray your cost of owning a Smith Mountain Lake home.
  • At best, you can generate enough money to pay your mortgage and all expenses, and still generate regular profits (positive cash flow).
  • You can choose when to rent. Do you want to enjoy the home yourself during July? No problem, you just make those dates “unavailable” for rental.
  • You may have some significant tax advantages by renting (consult with your tax advisor for clarity).
  • If you sell your home in the future, a solid rental history to show buyers will make your home much more valuable and marketable.
  • There is a consistent, strong demand for rentable homes at Smith Mountain Lake. This can be to your advantage if you decide to sell in the future. Rentable homes typically price in a premium, simply because they are rentable.
  • You’ll likely not have ANY problem renting your SML home. There is a huge demand for vacation rentals at Smith Mountain Lake, especially during the “high season,” which is mid-May to mid-Sept each year.
  • You can also generate income all year, not just during the high season. The bulk of income is generated during the summer, but rentals can and do occur year round.
  • Most renters are families on vacation, and they’ll tend to treat your home with a good degree of care and respect.

Let discuss some disadvantages.

Disadvantages of renting:

  • Your home will experience noticeably more “wear and tear.” Although you’ll be collecting rental deposits up front, let’s face it: renters come to the lake to have fun, and enjoy their vacation. Although the vast majority of renters are respectful per above, you’ll get some that treat a rental property like it’s a hotel room, vs. someone’s house.
  • You’ll need to consider what to leave in your home, and what to remove. Most likely, you’ll want to remove or secure items that are very valuable, or personal to you prior to having renters.
  • You’ll have some potential legal liability as the homeowner. I’m not a lawyer, but you should make sure you spell everything out in the rental agreement, and are properly insured against any claims that may arise, should a renter get injured or sick while renting your home.
  • Some neighbors will not like, and may even outwardly resent you using your home as a rental property. That said, it’s your property and you have the right to rent it, but this scenario can potentially be uncomfortable.
  • When seeking to buy a rentable home, again you will have a much smaller selection of available options. As such, buying those homes may involve significantly more competition with other buyers.

So, there are a number of advantages and disadvantages to renting your home at Smith Mountain Lake. Each prospective buyer’s situation is different, and you’ll of course need to evaluate what’s most important to you. Renting a home can open up a lot of attractive possibilities for the homeowner that wouldn’t exist otherwise. But for your own protection, just be aware of the disadvantages as well, so you go in “eyes wide open.”

If you are thinking about purchasing property at Smith Mountain Lake, or just have some questions, please visit my home page at smithmountainlake.homes to see available homes and lots for sale. You can also click Contact to reach me for a quick reply to any questions you may have.

Hope to see you at the lake soon!

By Ted Ciporin, Realtor

 

tciporin@gmail.com
540-309-4697
https://smithmountainlake.homes

Wainwright & Company Realtors®
16503 Booker T. Washington Hwy.
Moneta, VA 24121