Just like any new business there will be start-up costs when you begin your short term rental business. One of the great aspects of this business is that a person could spend less than $100 and begin making money! You may need business licenses, an LLC (highly recommended), furniture, decor, amenities and more. Each of these items has its own price tag. You can easily spend upwards of $20,000 or as little as a few bucks depending on your goals.
Your goals dictate how often you will allow your location to be rented, the price of your rental and also help you determine how much you should spend to start this business. If you only want to rent occasionally then you will not want to put a lot of money into start-up costs as it will take longer to recoup your expenditure. Someone who desires to rent full-time should take more care in the quality of furnishings as they will get more wear and tear and you do not want to continually spend your profits replacing furnishings all the time.
If you already have a home that is fully furnished then you can start your short term with minimal cash outlay, but you should still review your furniture to make sure it looks nice and matches the overall decor. Your business will live or die by guest reviews; therefore it is important that you do not provide your guests with obvious reasons to give you lower ratings.
Start-up costs may also be affected by the condition of your property. Look around your house (inside and out) for safety hazards. Your guests will be unfamiliar with your house and may be accessing it after dark, so common blemishes like broken sidewalks, loose paving stones, twists in a walkway and inadequate lighting can cause liability problems. Peeling paint will cause lower than necessary ratings and is an easy thing to fix. Plants and flowers always bring a fresh look to property.
Many people rent their guest bedroom and the mattress in that room is often a hand-me-down or purchased cheap. Double check to make sure it is comfortable. Remember, your guests are ultimately renting from you for a place to sleep. The mattress is extremely important. I have read numerous guest reviews of people complaining about the mattress at their host's house. This ought never to be! Firm mattresses can easily be retrofitted with a memory foam topper. Purchase one that is at least 4 inches thick. It will cost about $150 for a king size. Lumpy, uncomfortable and noisy mattresses need to be thrown away. You can purchase a really good quality memory foam mattress from our store relatively cheaply and for much less than most mattress stores. (http://houseforrentwebsite.com/store-short-term-rental-items.php).
Having all the same size mattresses makes swapping linens and purchasing new linens much easier. You will need two complete sets of sheets plus one reserve for each mattress size. Use the first two for swapping out between guests and the reserve to replace for damaged sheets. The cost for cheap sheets sets can start about $20.
It is only a matter of time until a guest ruins your sheets. Therefore, I do not recommend purchasing expensive sheets because it's just more money wasted when makeup, body fluids or other substances cause permanent stains and you are unable to recover damages. You will feel better replacing cheap sheets and considering the replacement a cost of doing business.
Once the mattress is covered you need to decide what amenities you want to offer. Some hosts offer nothing but a bed- not even linens to put on it. This is NOT recommended unless you are extremely clear in your listing that you do not provide these items as most guests will expect clean linens and towels. A decent bath towel usually costs $4 and up. You will need to purchase four for each guest you allow to stay at a time plus two to keep in reserve for fast damage replacement. Stock your rental with two bath towels per guest and keep two spares for swapping out between guests. Purchase three hand towels; one for reserve and the other two for swapping out between guests.
In the United States it is pretty much a given that a rental should include coffee. You will get complaints if you choose not to offer coffee, creamer and sugar even if your listing states it is not offered. A drip coffee maker with automatic shut-off (a MUST) will run $20 new and half that at a thrift store. A can of coffee costs $10 or less, powdered creamer about $3 and filters less than $1. This amenity will cost you less than $30 to offer and is worth much more than that in happy guests.
There is an owner in Vegas that does not offer coffee because there is a coffee shop a couple blocks away and he does not want to
Offering other food is your discretion. Most rentals do not provide snacks or food. We provide snacks such as microwave popcorn ($5 for a box of 36 packages) and bottled water (10 cents each) in our homes. If you provide food make sure you also provide accompanying dishes and eating utensils.
Obviously a completely empty house is going to cost quite a bit to get furnished. Again, starting up almost any business can be expensive. Be very careful as you make your purchases or you can easily spend close to $15,000 USD outfitting a simple three bedroom home. Remember, every dollar you spend must be recouped before you can make a profit. If you really research your purchases and take advantage of yard sales or second-hand furniture stores you should be able to nicely and completely furnish a one-bedroom, one-bathroom home for around $5,000. Add $200 to that amount for each additional bathroom and $950 for each additional bedroom. These amounts do not include extra rooms such as offices or bonus rooms.
You should always consider the cost compared to potential monetary return when deciding what amenities you offer. Will the amenity bring in more guests or encourage guests to write better reviews? (Better reviews also translate into monetary rewards). Purchasing a $5,000 hot tub may never pay off. Purchasing $20 of food may reap huge benefits. Again, go back to your goals and determine how your start-up purchases will relate and how much money you have on hand to spend starting this business.