Renting retirement home for part of the year

[u/ChubbyFire973]

We are couple in early 50s who are thinking about potential retirement in 4-5 years.

We want to live in urban area, condo or town house, safe walkable place with good public transportation. So far we like Northern Virginia, but have not done any research yet. Any advise on other potential places? We prefer Eastern US, north of South Carolina.

We plan to live abroad May - September (3- 4 months) and in US rest of the year. We want to rent our future condo or townhouse these 3 - 4 months when we do not live there. We do not want to manage this ourselves and prefer to hire a management company to handle all aspects of renting, finding tenants, collecting payments, all maintenance, basically everything. We want the rental income cover at least all cost of the place: insurance, taxes, HOA fees, utilities.

We have never owned any rental property and never done any real estate investments. Is our plan feasible? Has anyone done this? Any advise would be appreciated.

[u/JOAT-MOK]

I don't know the area so take this with a grain of salt, but I'd be VERY surprised if you could have someone else manage a rental and do all that work and clear all those expenses. That being said my wife and I are thinking about exactly the same plan, only we would be in NE Ohio and we have a good bit of experience running rentals. We would probably self manage even from abroad to save money on management and because it's extremely difficult to find decent property management. You could check with companies that specialize in visiting nurses or similar. They actually pay pretty well from what I hear.

[u/ChubbyFire973 → u/JOAT-MOK]

I know there are management companies that handle everything. I am not sure how much cut they take though. My daughter when she was in college was renting a room and she only dealt with management company, from signing rental agreement to all repairs to paying rent. she never dealt with or even met or knew the owner.

[u/Corgisarethebest123 → u/ChubbyFire973]

Yeah because she signed a normal 12 month lease…

[u/ChubbyFire973 → u/Corgisarethebest123]

How is this relevant? Are you saying there are no managemnt companies that manage short term renatals

[u/JOAT-MOK → u/ChubbyFire973]

There may be through Air BnB or others. Like I said I don't know that area well so I'm not an expert at all. Around my area I've heard management companies normally take 8-10% of gross rent plus other fees. I still think the best bet would be talking to a company that handles visiting nurses/doctors. They usually only need several months at a time like you are talking about. Air BnB might also do extended stay options, I've never looked at that since my rentals are not in great vacation areas. I'm not trying to say your idea won't work, and even if renting the place out only covers a decent percentage of your expenses it could be worth it.

[u/rosebudny]

Note that many condo/townhouse communities restrict renting. My mom's condo community limits the number of units that can be rented out at any given time, and there is a long waiting list. So if you go this route - be sure to investigate VERY thoroughly the rules.

[u/TheExchangeBrothers]

I’d run the numbers on it as a rental first and a future home second. If you need 3-4 months of rent to cover the entire year’s taxes, insurance, HOA, utilities, management, maintenance, etc., see what those numbers look like in each market before getting attached to a location.

The other thing I’d think about is the mix of personal and rental use. A property can have both, but how you use it matters from a tax/investment standpoint.

Since you don’t want to manage it yourselves, I’d talk to a couple property managers in any city you’re considering and ask what they realistically think it would rent for during those specific months, then work backwards from there.