What To Know Before Renting Your Home Out For 2010

By Mark Szekely

VANCOUVER -As tickets go on sale for the Vancouver 2010 Winter Olympics and Paralympics, many foreign spectators are now turning their minds to the question of lodging.

While most Olympic spectators will stay in traditional hotels, others will seek to rent private houses or condominiums instead. Thanks to recent developments in information technology, it has become increasingly practical for a foreign visitor to arrange to rent a private residence directly from its Canadian owner. Vancouver residents have responded to this trend by offering their homes for rent during the 2010 Olympics. This article will outline some of the potential rewards and challenges experienced by homeowners.

When considering the option of renting out a home for the 2010 Winter Games, many owners are unclear as to what rates the market will bear. Furthermore, the rents that homeowners can expect to receive for the 2010 Olympics will be governed to a large extent by hotel room rates, which is problematic because hotel rates and availability have not yet been announced. Therefore the only “pricing benchmark” available to homeowners at this time would be the asking rates of other owners.

What do other Vancouver homeowners expect to charge during the 2010 Winter Olympics? Using a sample of 198 home rentals from the website Rent 2010 | Vancouver-Whistler Accommodation (Rent2010.net), I calculated an average nightly asking rate of $915. The average home size is 2.7 bedrooms, giving rise to a nightly rate of about $340 per bedroom. Smaller homes show a relatively lower overall asking rate, but a higher per-bedroom rate. One-bedroom homes show an average overall asking rate of $464 per night. By comparison, homes with more than four bedrooms show an overall asking rate of $1,248 per night, but an average per-bedroom rate of $229 per night.

Asking rates also differ by region. Whistler asking rates are the highest (at $478 per bedroom), followed by Vancouver (at $389 per bedroom). Some of these differences can be explained by different home sizes across regions. Other factors may relate to the proximity to Olympic events, as well as anticipated supply shortages in specific areas - namely Whistler.

While the question of appropriate pricing is important, it is not the only challenge faced by those planning to rent out homes for the 2010 Winter Games. For a private vacation rental deal to succeed, a relationship of trust and accountability must first be established between the homeowner and the prospective renter.

In order to protect the interest of both parties, homeowners and prospective renters will usually agree on a deposit. From a homeowner’s perspective, a deposit helps ensure that the renter will honour the agreement to rent and treat the owner's home with respect. From a renter’s perspective, the homeowner’s acceptance of a deposit signifies that the home will not be rented to another party instead (e.g., a higher bidder). Homeowners and renters may wish to enter into an escrow arrangement whereby all funds are deposited with a neutral third party (e.g., attorney or trust company) until the rental period has finished. In the United States, a handful of specialized “vacation rental escrow” firms have emerged to service this particular niche.

Another challenge faced by Vancouver owners relates to promotion. While the advertising budget of a private homeowner cannot rival that of major hotels, the Internet has spawned numerous venues for Vancouver residents seeking to promote their homes for rent during the 2010 Olympic Games. While the nature of services offered (and the costs involved) vary, these websites generally fall under three categories:

1. General Classified Listings Websites: Craigslist Vancouver is the frontrunner in this department, and contains a large number of listings for private vacation rentals. While general classified listings websites are often free, a limitation is that listings typically expire after a relatively-short period.
2. International Vacation Rental Services: The website VRBO.com has become a household name in the timeshare rental and exchange community. A listing on a large rental site has the potential to generate a significant number of leads, but the cost can be significant ($229US per year in the case of VRBO).
3. Niche Rental Websites: Niche sites such as Rent2010.net represent a cost-effective medium for local homeowners seeking to rent out homes during the 2010 Olympics. Niche sites can have the ability attract highly “targeted” search traffic (e.g., people searching specifically for Vancouver accommodation during the Olympics). Keep in mind that a site's promotional value for your listing will depend not only on aggregate daily site traffic, but also on the countries from which these site visits originate. Before paying to list, ask the site’s owner for website visitor statistics, and for specific locations where the website is advertised.

Which form of promotion is likely to be most effective? My recommendation is to advertise early and on as many websites as your financial budget (and time constraints) will allow. A useful strategy can be to create a listing with a well-written description and half-dozen photos, and to establish a "permanent home" for it on a quality website such as VRBO.com or Rent2010.net. Free (“expiring ad”) services such as Craigslist can then be used to funnel additional traffic to your listing’s permanent home.

By carefully considering the issues of market pricing, trust-building, and effective promotion, Vancouver homeowners can maximize their chances of concluding a successful vacation rental deal.

Mark Szekely owns and operates Rent2010.net, which helps visitors and locals connect for accommodations during the Vancouver-Whistler 2010 Olympics.

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This article is intended as a pricing guide and how-to aid, but should in no way replace certified legal counsel. Please check with your city-bylaws to see if renting is legal in your neighborhood.