Do short-term rentals affect property values? Well, what does affect property
values? Is this a good thing, is a bad thing? There are some very surprising
things that you need to know and we're going to go through all of it. L.et's go
Do short-term rentals affect property values?
What does affect property values? How do you know? How do you not know? There are
some very surprising information on the subject that we're going to go through. In
this video, I'm going to share with you what affects property values and what doesn't.
And the answers are definitely going to surprise you. Number 2, I'm going to teach
and share with you some online tools so that you can determine property values
like a pro. And last but not least, I'm going to teach you what not to worry about
so you do not waste your time looking for things that do not matter. So, first
before we get into all of this, we have to talk about what short-term rentals
are. Because you need to know what they are in order to determine if they affect
the value or not. So, short-term rentals are just that. They
are properties that people do not rent for a very long time. So, most of the
apartments and things that you've probably rented. You probably rent it on
a long-term basis. You probably leased an apartment before
you got your own house. And you leased it for a year or 2 years. Well, a
short-term rental is a property that you would lease out on a nightly basis, okay?
So, these are vacation rentals, these are Airbnb. These are Home Aways. These are
properties that people rent on a per- night basis instead of on a yearly basis.
So, now let's talk property values. So, we know that property values are determined
by what? Well, there are different things. Basically what the property value is is
what a person will pay for a property. So, there's different means to get this. So,
one of the major ways that I'm going to teach you here is a very simple way
called an AVM --an Automated Valuation Model. Okay? So, if you've ever been to
Zillow or Redfin or any of these other sites and you typed in to see "How much
is this house worth?", they probably spit out a number based on an AVM. And where
that AVM that automated valuation model is pulling information from is from all
of the sales in the area? So, that's the key. In order for you to know what
property values are, you need to know what other
homes similar to your home or the home that you're talking about, similar to
that home what other homes like that sold for in
the area. So, there's some criteria that I'm going ot go through really quickly. When
we're talking about the value of a property, we're usually talking about
properties that have sold in the past 6 months to a year around that
property. Usually within a one mile radius of the property. So, I'm going to give
you an example. So, say you have a house on 123 Main Street. And it is a
3-bedroom, 2-bath. And you want to know how much this home is worth. Well,
the easiest way to find this out is going to be to see what did other
3-bedroom, 2-bathroom houses sell for in that neighborhood? What about if
there aren't any houses on that street that sold? You know... Or that weren't
comparable. Maybe there were houses that sold. But they were all 5-bedrooms and
6-bedrooms and they're not really like your house. But what if maybe down the
street, there was a 3-bedroom, 2-bath? Well, then that would be what we
would call a comparable sale. We want to find properties within one mile of the
property that are similar in the number of bedrooms and the number of bathrooms
so that we can see what people are paying for for these types of properties.
Now, that's is just an estimate, okay? And there's 2 ways to get these estimates.
If you are really interested in finding out exactly what that particular house,
you can hire what we call an appraiser. And they will give you the appraised
value. You will pay a few hundred dollars. Maybe 4 or 5 hundred dollars, they
will come to that property, they will evaluate that property and they will
evaluate other sales and they will give you a pretty long report detailing
exactly how they got that value and we're they got that value and what the
value of that property is. Now, again, that's something that you could do if
you were buying a home, they probably would make you get and pay for an
appraisal. But I'm going to give you some free ways that you can do it. But before
I get to that one, I'll tell you one other way. If you know someone must like me a
licensed real estate agent, okay? Now, again, I'm not out selling houses. No, do
not call me I'm not going to sell your house. I'm not going to list your house. I
don't really do that anymore. But a licensed real estate agent has access to
what we call MLS --Multiple Listing Service. And in the
Multiple Listing Service, they can pull was called a C-M-A, a Comparable Market
Analysis. And they can tell you and gives you an estimate of their value based on
some of the sales that they are seeing in the area. Some real estate agents
might do this for you for free. Some might charge a little bit of a fee.
But this is another really easy way that doesn't cost a lot of money. Now, I'm
going to give you the free ways. So, some free ways to find out what properties
are worth our Zillow, okay? They have this thing called as Zestimate where you can
put in the property address and it can spit out the value. Additionally, you can
go to the S-H-S-A. And that stands for the Federal Housing Finance Authority.
And they have something called an H-P-I or the house price index where you can type
in and they can literally it's an online tool where you can find out what they
are assessing the value at or what they are estimating the value of the home to
be worth. But what I do recommend actually are the websites like Zillow
which is totally free. And Redfin, R-E-D-F-I- N, depending on where you are in the
country. Both of those valuation models are very good depending on where you are
in the country. Some areas are better than others. Redfin is actually really
good on the west coast. And Zillow has actually gotten really good pretty much
everywhere in the United States. But you really want to check out some of those
free sites so you should can start to see what values are worth. So now, let's
get to the other part about short-term rentals and if they affect the value or
not. I think if you've been listening to this video, you can probably tell that
short-term rentals probably do not affect the value very much. So, like I
said, it's mostly about what other properties are selling for in the area.
And yes, there are certain things that do affect a properties value like the
condition of the property, the age of the property. You know, things like that. How
well the property was maintained. Those are some of the real things that affect
the value of it not necessarily if there are lots of other short-term rentals in
the area or if the property was used as a short-term rental or things like that.
So, as you can see, short-term rentals do not necessarily affect the value
of prices in the area. So, I want to go ahead and offer you the opportunity.
If you haven't watched the video yet, I have a video about finding motivated
sellers on Zillow, okay? And I want to invite you to watch that video. I'm
teaching you so much information here. I have a whole playlist which is almost
like a free course right here for you. If you could go ahead and take this moment
and like this video, subscribe to this channel. I will see you next time.
To your success.