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Owning a property and renting out via VRBO
Old 02-19-2010, 10:19 AM   #1
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Owning a property and renting out via VRBO

I have seen mentions from time to time of people using VRBO to find a holiday let. However, I am wondering if anyone who owns a property has rented it out via VRBO and what the experience was like.

We are thinking about buying a place in Hawaii, with the view that is going to be our long term residence, however whilst we are tied to the mainland for work, thought we could do temporary lets to cover some of the costs.


I be a girl, he's a boy. Think I maybe FIRED since July 08. Mid 40s, no kidlets. Actually am totally clueless as to what is going on with DH.
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Old 02-19-2010, 12:47 PM   #2
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Originally Posted by DangerMouse View Post
I have seen mentions from time to time of people using VRBO to find a holiday let. However, I am wondering if anyone who owns a property has rented it out via VRBO and what the experience was like.
We are thinking about buying a place in Hawaii, with the view that is going to be our long term residence, however whilst we are tied to the mainland for work, thought we could do temporary lets to cover some of the costs.
I may be misinterpreting your question, but are you sure that landlording a vacation rental is how you want to be introduced to your new neighbors? Or the kind of neighborhood in which you'd want to live?

I'm all too familiar with this challenge due to landlording from the Mainland for a few years, and also due to providing maintenance service for a shipmate for the last five years. She has most excellent tenants yet still has business for us about twice per quarter.

If the "V" stands for "vacation", then local vacation rentals have a reputation of being noisy, messy places full of absentee landords for short-term visitors. Not the sort of place where a local would want to live, although they might enjoy a vacation there. In general vacation-rental communities are difficult to maintain, let alone improve, and "enforcement" of community rules is nearly non-existent.

It's a tough financial situation, too. You'd pay 4% excise tax on gross rental income (4.5% on Oahu) plus an additional 11-12% "short-term rental" tax on gross rental income, and then there's IRS Schedule E.

Logistics are challenging. If you're renting it out short-term then you're going to want an onsite manager to handle checkin/checkout as well as cleaning. You'll always be wondering whether the manager really had a vacancy that week or just handed the keys to a family member for their own vacation, or to a friend who needed a crash pad. Then you'll wonder how much they're really charging the legitimate tenants. Finally you'll wonder how much kickback they're really getting for that wonderful cleaning service or that excellent handyman. No doubt most of the cleaning staffs and handymen are consummate professionals, but I could tell you lots of stories about the stoner handyman who's maintaining a dozen rental properties in a gated community on the Big Island.

Enough about management and maintenance staffs, let's look at the customers-- there's ClifP's whole thread on his pot-smoking tenant. Military on orders or elderly snowbirds are a whole different class from the younger short-term visitors who come here for a quick Waikiki getaway or North Shore surfing.

Oahu, especially the Kailua area, has a huge neighborhood problem with illegal vacation rentals and "off-the-books" B&Bs. I don't know what permits are required to run a vacation rental, if any are required at all, but many communities are starting to take a NIMBY attitude toward short-term rentals.

No offense intended; perhaps I misunderstood and you're looking at buying a condo or a single-family residence for a long-term tenant. In that case the state requires a local contact for management/maintenance issues, although that rule is seldom enforced and widely violated. You'd still have the usual landlording challenges to handle across multiple time zones.

I don't know how far along you are in the decision process but you could do more landlord/management research at George is a retired submariner who's turned his family business over to the next generation, and they manage over 400 properties on Oahu. I've met with George and he's a nice guy/good businessman. I can't confirm that they're 100% honest (I suspect he is, he's a USNA '55 alum) but their wealth and their reputation give them much less of an incentive to cheat. I can also give you the name of a neighbor realtor couple who manage a number of their own rentals-- good people and I can vouch for their integrity. If I had to leave the islands for a few years then I'd ask these neighbors to take care of our place.

Other Oahu board members might know other management firms, and if your property's on Maui then you could check with JB. Don't know if we still have members on the other islands.

If your property's on Oahu and you're looking for tenants willing to sign at least a year's lease then you could try for military tenants through It's a nationwide DoD-sponsored system of landlords (military and civilian) advertising for military tenants. I can't claim that a 20-something Army 2LT or a teenage enlisted submariner will be a better tenant than anyone else, but at least they're not going to lose their job in the middle of your lease. Military also have a very generous housing allowance and you'll easily attract a tenant with better finances who'll be able to afford market rent.

I don't know where you are in the process but if your contemplated property is on Oahu then I'd be happy to check into any other questions/issues you might have. Spouse and I enjoy looking at places and crunching numbers. You'd still have a handyman challenge, and I don't have any easy answers for that one. The guy we used while we were on the Mainland was "satisfactory" but not much better than that.

And finally, even if you've already made the "moving to Hawaii" decision, I can recommend to keep up with local issues or to ask these types of questions. Even after 20 years here we're still learning from about new cultural aspects as well as places we'd never discover on our own.


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Old 02-19-2010, 02:22 PM   #3
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Online sites such as VRBO,, and homeaway act as a platform for you to market your home. Hopefully, by listing with one of the sites, you get referrals that you contact and turn a portion of them into renters. We are happy with the results of using vacationrentals . I would recommend you look at the various sites first. We went with ours because the price was right, we are sticking with them, because we are getting our money worth thru the number of renters we are generating. These sites do not manage the property for you, so if that is what you are looking for, you probably need to find a local real estate agency that specializes in that.
"The four most dangerous words in investing are 'This time it's different.'" - Sir John Templeton
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