You may have been hearing that your friends are purchasing investments and using Airbnb or Vrbo or other systems to rent those properties and they're actually making more of a profit than if they just rented the property outright.
First you will want to purchase a rental in a place that you enjoy and that you think other people would also enjoy because after all, you have to have people coming in to rent the property for it to turn a profit.
So, after you've identified where you want to purchase the rental you have to take a very basic look at what is the property going to cost you to maintain on a monthly basis and how much can you rent it for.
First considerations are taking a look at your mortgage amount and then what you'll do is you'll do some basic research. Find out what other vacation rentals are going for in that area and then divide the nightly rent into your mortgage payment so that you can know how many nights per month do you need to rent the property in order to break even and then start to make a profit.
Don’t forget it's not just your mortgage payment to consider in your expenses. It's also the utilities required for you to hold that property. So, it may include internet if you're going to provide free internet at your property, certainly includes electric, possibly gas and you may also have a water sewer bill, and also include insurance and condo fees if any.
So what are all of the costs required for you to hold that property on a monthly basis. Figure out your nightly rental fee and then you'll be able to determine how many nights per month you need to rent the property.
I hope you found this information helpful. If you need more information,
please reach out to me, I’d love to help you walk through the questions and steps!