Short-term rentals, such as those advertised on websites like Airbnb and Homestay, are quickly turning into an increasingly affordable and accessible choice for travelers across the globe. With Airbnb alone having more than 6 million listings worldwide, the short-term rental market is an ever-more appealing investment opportunity. Being a mortgage broker, private lender, or referral partner who can interpret the increasing popularity of vacation rentals can make you a go-to advisor for clients seeking financing for these properties.
With the proper financing options, real estate professionals can access a profitable niche that yields high returns. By partnering with RCN Capital, brokers and wholesale lending partners can offer their clients flexible lending options specifically designed for short-term rental investments.
Here's why vacation rentals are an opportunity you shouldn't miss and how you can capitalize on this trend to expand your business.
The vacation rental market has expanded tremendously over the last ten years. Tourists are choosing vacation rentals instead of conventional hotels due to their distinctive, homely experience. Demand is fuelled by the following reasons:
To private lenders and brokers, this increase in demand also offers a business opportunity to sell clients financing arrangements for short-term rental investments. By assisting the investor in accessing the proper funds, you position yourself as an indispensable ally to their path toward financial success.
Before recommending financing for a vacation rental property, it's important to assess key factors that impact profitability. These include:
Short-term rentals also attract local regulations, such as restrictions on the number of rental days or special permits. As a broker, it is critical to ensure clients know the local restrictions to avoid compliance issues later on.
Short-term rentals tend to generate more rental revenue than long-term rentals, but they also have higher costs. Mortgage brokers should assist clients in comparing:
Unlike long-term rentals, short-term vacation properties require frequent upkeep. Investors must account for:
As a financing partner, you can guide your clients in structuring loans that accommodate these additional costs while ensuring profitability.
RCN Capital provides customized financing solutions specifically for short-term rental properties. The loan products are made available to investors interested in buying, refinancing, or growing their short-term rental portfolio. Some of the major advantages are:
By partnering with RCN Capital, brokers and wholesale lending partners can provide financing solutions that align with the unique needs of short-term rental investors.
As a mortgage broker, referral partner, or private lender, tapping into the short-term rental market allows you to expand your client base while increasing loan volume. Here’s how:
Position yourself as an expert by educating clients about the pros and cons of vacation rentals. Sharing information on financing possibilities and profitability is an effective way to build credibility and bring in additional business.
Develop relationships with investors actively engaged in the short-term rental market. Most of them require repeat financing as they build out their portfolios, providing continuous opportunities for lenders and brokers.
Clients who are investing in short-term rentals tend to require financing solutions that can fit variable cash flows. Emphasizing RCN Capital's loan programs specifically designed for vacation rentals can differentiate you from others.
The short-term rental market doesn't appear to be slowing anytime soon. Based on industry publications, the global vacation rental market will hit $107 billion by 2027. With increasingly more travelers seeking offbeat stays as opposed to regular hotels, investor demand will continue to escalate.
For wholesale lenders and mortgage brokers, this is a profitable chance to offer bespoke financing solutions. By leading the market and providing customized lending choices, you can promote business development while assisting clients in reaching their investment objectives.
If you’re a mortgage broker, private lender, or referral partner looking to expand your services, vacation rental financing is an excellent avenue to explore. RCN Capital provides customized loan programs designed for short-term rental investors, ensuring competitive rates and seamless funding solutions.
By partnering with RCN Capital, you have access to a reliable lending partner with extensive industry knowledge. Whether your customers are first-time investors or seasoned property owners, our financing options can assist them in thriving in the short-term rental business.
This article originally appeared on the Mortgage Professional America website. View the full article here.