Renting Out Your Place Abroad While You Are Away
For the other eight, it sits with the blinds drawn.
Picture a couple named Charlotte and Barney, 66 and 69. They own a small apartment in a city in Mexico. They live in it for four months a year. For the other eight, it sits with the blinds drawn.
A neighbor suggested renting it for short stays. Charlotte liked the idea. Barney asked who would clean and who would answer the telephone.
They talked to a property manager. In Mexico, managers commonly charge 15% to 30% of the rent for short stays, and 8% to 12% for a long lease. The fee varies by manager and by city. The booking site also charges the host a fee, and it is worth asking the manager whether that comes out of the percentage or on top.
They tried two months in the first year. The rent in the table is an illustration: US$1,350 a month for a short stay. Cleaning and the booking site's fee could come out of what they keep.
| Two months of short stays (illustration) | US$ |
|---|---|
| Rent, 2 months at US$1,350 | 2,700 |
| Manager at 15% | −405 |
| They keep | 2,295 |
| Manager at 30% | −810 |
| They keep | 1,890 |
Barney read the table twice. "He keeps fifteen percent to thirty percent for answering a telephone?"
Then he asked the question that the table does not answer. Short stays are not booked every night. A long lease for the eight months would be one rent, paid every month, with a lower fee and fewer changeovers. So he put the two side by side for the eight months they are away. The long lease is an assumption of US$900 a month, and an eight-month lease needs a landlord and tenant who accept it, so he wrote that as a question.
| The eight months they are away (illustration) | Short stays | One eight-month lease |
|---|---|---|
| Rent per month booked | US$1,350 | US$900 |
| Manager's fee | 15% to 30% | 8% to 12% |
| They keep per month booked | US$945 to US$1,148 | US$792 to US$828 |
| Months booked needed to match the lease (US$6,336 to US$6,624) | About 5.5 to 7 of 8 | 8 of 8 |
"So the short stays win only if the apartment is booked about 70% to 90% of the nights," Barney said. "And the gaps cost us."
"And the cleaning," Charlotte said. "I left that out of the table."
The occupancy of a short-stay apartment depends on the city and the season, and a manager could give a real figure. Barney wrote it down as the first question.
In the second week of the first stay, a guest wrote that the hot water had stopped. It was early morning in Oregon. Charlotte forwarded the message to the manager. A plumber arrived before the guest finished breakfast, and the guest wrote back to say thank you.
"That was the telephone," Charlotte said.
Barney nodded. He also asked his insurer one more thing. Home policies often treat paying guests differently, so he asked what theirs said. Rent is income, and it may be taxed in more than one country. An accountant could confirm what applies to them.
You could…
- Ask two managers what the fee covers, including cleaning, repairs, and the booking site's fee.
- Ask a manager what share of nights apartments like yours are booked, by season.
- Ask your insurer in writing whether paying guests change your cover.
- Try one or two months before you plan the whole season.
If you have handed your keys to a stranger, what helped you trust them? Add it in the comments. A reader about to hand over keys for the first time could try what worked for you.
Figures are estimates for planning, based on public data, before income tax.
Sources: published management-fee ranges from property managers in Mexico. Fees vary. The rents and the booking assumptions are illustrations.
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