Beach House for Fun and Profit

Make money and catch some rays at the same time!

What is the Life Expectancy of that Appliance?

Did you know that every appliance in your home has a lifespan?  Normal wear and tear will eventually lead to breakdowns.  

We recently noticed our dishwasher was beginning to leak and it began to sound terrible.  Then the control panel on our microwave came loose.  Both still functioned, but not well.  Should I call an appliance repairman or replace these?

Leaking Dishwasher
Leaking Dishwasher
Kitchen with original appliances

To most effectively manage your budget, you should consider the typical appliance lifespan when considering this decision.  A good rule of thumb is that if an appliance is more than halfway through its lifespan and repairing it will be more than half of the cost of a new appliance, it makes more financial sense to replace it.  Obviously, if the appliance is past its typical life expectancy you should forego any attempts at repair and just replace it.

Average Life Expectancy of Common Appliances
source: Dana Chase Publications

In our case, both were original to the house and now 12 years old.  We opted for reasonably priced replacements purchased at our local appliance store-Johnson’s Appliances.  (Incidentally, less expensive than Lowe’s after factoring in the cost of install/delivery/haul away, etc!) Here is to hoping we get the full life expectancy!

New Microwave and Dishwasher

How to Choose Patio Furniture

As the summer season approached we found ourselves needing to purchase our third patio dining set in four years.  The shore salt-air makes quick work of the inexpensive aluminum tables and chairs we had been purchasing. 

Inexpensive, rusting patio furniture
(click to view larger image)

The corroding metal was unsightly but the rust stains left on the deck were even more of a problem.  And this is to say nothing of the frustration of assembly and lugging everything up our many flights of stairs.  If it was possible to purchase something that would not rust, was simple to care for, could be easily moved yet heavy enough I did not have to worry about it flying off the deck in a storm and would last…then it would be worth a financial investment.  So what to purchase?

Pretty quickly I narrowed the choices to Teak or Polypropylene (Polywood).  The chart below demonstrates the pros and cons of each type of patio material.

Each characteristic is not equal however, or I would just buy cheap plastic furniture and replace it each time it became brittle from the sun or blew off the deck in a nor’easter.  Since that is obviously not a route I could consider, I pretty quickly narrowed my choices to Teak or High Density Polyethylene or HDPE (eponymously known by the brand Polywood). 

The Teak furniture really spoke to me, but the prospect of needing to oil it on occasion to maintain the rich color seemed too onerous.  Polywood seemed my best choice as it would require virtually no maintenance, would never rust or need painting and there was no chance it could blow away.  Made of high density recycled plastic milk jugs, polywood offered unparalleled durability and appearance at a reasonable price. 

Since our deck is a rather tight space, I spent the entire off-season trying to find a slimmer profile polywood table that could seat six.  I found you can purchase polyethylene furniture from Polywood direct, from distributors like Costco, Hayneedle, Wayfair, etc. or other “poly” makers like Breezesta or Luxcraft.

If ordering a table and chairs direct from polywoodoutdoor.com, as was my case, then your order should arrive well packaged on a pallet within ten days.  Assembly is very easy. It mostly consists of attaching armrests and table legs. 

Attach arm rest to chairs
Table out of the box
Attach table legs

Flip it all over and you are done.

We opted to pair the Nautical dining table with the the Nautic Café chairs as we liked the minimalist style of the chairs and the ability of these to stack.

Care for these items should be very easy.  While I recognize there is some metal hardware involved, Polywood uses high-performance marine-grade quality metal which is warrantied. From prior experience with poly furniture I know this can be left out all year (even in a coastal climate) and generally just needs a light wipe with soapy water to remove pollen or residue and then appears as good as new.

The furniture really only needs to last 4-6 years to pay for itself in comparison to the cheap aluminum furniture we had been buying. Here is to hoping this furniture lasts much longer than that!

Living with Vertical Blinds on Sliding Glass Doors

Your rental very likely has sliding glass doors or French doors.  If you are not fortunate enough to have built-in blinds with these doors, then you will need a window treatment option.  Typical treatment options include curtains, shutters, shades, sliding panels, and of course vertical blinds.  Let me tell you why the obvious choice of vertical blinds are likely your best option particularly in a bedroom where you must block out light from a slider door.  I will also discuss how you can mitigate the inevitable shortcomings.

Simply put, vertical blinds offer the right combination of affordability, functionality, and safety in a high traffic rental.  Any other type of treatment would come up short in one of these three qualities.

Safety

If you don’t have children, this is one attribute you might overlook.  However, there will be children in your beach rental and we have all seen the warnings on window treatment loops.  Some very beautiful options, like rollershades, necessitate pulls or chains that will be within reach of toddlers.  Likewise, shutters can fold in on and pinch little fingers. Even the most affordable option, a curtain, can be a tangle risk and will require ties which can also pose a danger.  More likely, children will yank or pull down the curtain and bring down the rod too.

Functionality

I am always surprised by how people manage to stain walls, linens, carpet etc. Curtains or drapes will get stained and collect dust.  They pose quite a challenge to clean in what may be a quick changeover between guests.  To clean, a curtain needs to be taken down, washed and laid out to dry. Some of the more aesthetically pleasing options like sliding panels or shades have the same drawback but are even more difficult to clean. An important element of functionality is durability.  Sliding panels and cellular blinds are designer options that might be a great consideration in your primary home but are not likely to hold up to the beating a rental will receive.  Vertical blinds, however, are typically made of PVC plastic and are durable and can be cleaned with a wipe.  They can withstand heat and humidity well also.

Affordability

Mentioned previously, curtains are likely the most affordable treatment option. Stock vertical blinds at a home improvement store are not much more costly. Custom blinds made of less typical materials like wood or fabric, shutters, shades and sliding panels will all be more of an investment. When outfitting your beach rental remember my mantra, Keep it Simple…But Nice. You do not want to throw your money away buying something extravagant if something simple, but nice will suffice.

Cons with Vertical Blinds

Vertical blinds are constructed using slightly overlapping slats (aka vanes) that connect on a headrail. Sometimes, if one slat should be turned the wrong way it can break off from the headrail. You are not out of luck when this inevitably happens, it is possible to reattach the slat.  Lifehacker has a trick where this can be done with a paper clip and piece of tape if you are in a pinch, but the best option is to keep on hand Blind Saver Clips.  If someone is even rougher on them and should bend or break a slat all together you will need to replace the slat.  For that reason, I keep an extra set of blinds on hand to replace slats when necessary.  Companies like Levolor found at Lowes has a ten-year warranty and will replace your vertical blinds when damaged, but grabbing a new slat from the closet is a whole lot easier.  To make this proposition cost-effective, stick with stock blinds and consider an easy to find neutral color like white or cream.

Your sliding door treatments will get damaged periodically, unless you manage to screen guests for children, clumsy adults, etc.  It is just a question of setting your expectations and being prepared to make repairs.

Update: New Jersey Short Term Occupancy Tax and Airbnb

Airbnb will now collect the 6.625 percent New Jersey sales tax and 5 percent state short-term occupancy fee, as required by the New Jersey 2019 budget law, with reservations booked on or after December 1, 2018.  See below this post for details from Airbnb.

Renters of New Jersey Shore properties will only be able to avoid paying this tax IF: the rental is a permanent residence (you live at the location and have at least a month to month lease), the accommodations are obtained via an agent or broker licensed by the state Real Estate Commission, or the rental is by a qualified non-profit organization which typically receives waivers of state fees.

The powerful Realtor lobby worked hard to ensure the loophole which exempts realty agencies from these taxes.  Homeowners, which have no similar lobby, have an obligation to collect the taxes even when renting directly to friends or other consumers whether it be online or offline.  This certainly seems to be inequitable.  However, shore realty agencies typically charge 16-18% commissions (and I would expect it is only a matter of time before the state of New Jersey comes to them for more revenue).

Bottomline, if you use Airbnb or local agencies exclusively this is not much of a concern for you.  Otherwise be sure you collect and remit the 11.625% required for New Jersey short-term rentals you acquire by any other means.

How to Close Up for the Winter – End of Season Checklist

October and November are the months when owners of beach homes typically close up for the winter. While some duties may vary based on your region or type of house, there are some things you should always consider doing if your property will be vacant for an extended period.

With only a little modification to cover alternative situations, below is the checklist I use.

Close for Winter Checklist

Exterior

☐ Take inside umbrellas, light furniture, and any foam padding/cushions to avoid mold and mildew build up.

☐ Properly secure large furniture that will remain outdoors. I use a bungee cord to secure everything together and cover with a tarp (be sure to secure a tarp well, I use ratchet straps).

☐ Store inside a shed or garage garbage cans which have been rinsed well.

☐ While rinsing, use the garden hose and sprayer to rinse the dirt and debris off the blades and condensing coils of the outdoor AC unit.

☐ Shut off and drain outdoor water spigots to prevent freezing damage. Likewise, drain and bring in garden hoses.

☐ Check weather-stripping, exterior doors and windows to ensure no major deficiencies are present.

Interior

☐ Clean the house thoroughly! This includes:

☐ Remove all perishable foods. Any food that remains should be stored in airtight containers.

☐ Clean the oven to remove food particles.

☐ Clean out the refrigerator, freezer, sink traps and garbage disposal. (Again, we are trying to minimize the chance of rotting bits of food attracting any critters.) I leave the refrigerator on, but if you are shutting off the refrigerator, leave the door cracked open.

☐ Unplug household and major appliances.

☐ Pull shades down to protect from sun.

☐ Put dryer sheets with stored linens.

☐ Replace HVAC Air Filter and consider having your heating system serviced.

☐ Shut off cable TV.

☐ Forward US Mail.

Either:
☐ Turn off the water (requires shut off at main supply and draining all faucets. Typically, you should leave one faucet open on the lowest level of the house to allow air and excess water to drain).

Or:
☐ Keep your home warm enough to ensure the pipes do not freeze. I opt for 59°F to help keep the interior of the floor and wall cavities, where the water piping is likely located, above freezing temperatures sufficiently even if the power should go out for a bit.

☐ Ask a trusted local person to check in to perform a visual on the house occasionally…this could get as extensive as shoveling the driveway, looking for ice dams, snow drifts, etc. for you after big winter storms.

An ounce of prevention is worth a pound of cure and attending to these items now can prevent a potential disaster and expensive service call. The checklist can also be downloaded as a Word document: End of Season Checklist.

 

How to manage a beach house from a distance

How do I manage a beach house when I live far away? It is a question to consider as you contemplate a vacation rental investment or a question you might ask after you have purchased one.

Typical challenges to a long-distance owner include how to manage check-ins/check-outs, cleanings, emergency repairs, payments, etc. If you live close by, it might be easy for you to show up on demand and manage all these things yourself. I have seen it done…with varying degrees of success. However, if you live far away this just is not practical. In my mind, I think of the tagline from the movie Ghostbusters – Who you gonna call? That is was it boils down to. You need to have someone to call for everything.

You can opt for one call…to a management company. They can handle most things for you; from procuring guests, sending leases, providing and retrieving keys, emergency repairs, payments, etc. This convenience however, will cost you. Management companies in Ocean City, New Jersey for example, charge between 12-18% commissions. Ultimately you are still responsible to handle routine maintenance, repairs to appliances and more yourself. (I imagine they could handle this for you too for a still extra charge.)

Quick story: A rental agency guest complained that a toilet seat broke at our place. The agency called me to see what I wanted to do about it. Oh, I don’t know, fix it? OK, do you have someone to send out or do you authorize us to send a repairman to purchase and replace the toilet seat? I opted for the later because I was hours away. I expected to be gouged, but I was not expecting a bill of $260! A standard toilet seat at the Home Depot is ~$35 and while the service call fee for a handyman may vary greatly, $200+ was more than exorbitant.

I learned pretty quickly it was good to have a book with the appropriate people to call for typical scenarios like the toilet seat. A plumber, a cleaner, an HVAC company, general handyman, etc. It will take some time but you will develop a network of others you can rely on and trust to handle issues for you. Sometimes that is a trial and error process. In my case, I was fortunate enough to find a capable person who performs the cleaning during our changeovers which acts as property manager and set of eyes each week at guest changeover. She lives very close and can save me a long trip for cases like a chirping alarm, lockout, etc. Finding an individual like that is a big help to the long-distance owner.

Another way you can manage a beach house from afar is by automating as many processes as you can. Whether you use a booking website, a local agency or you find renters on your own you should automate to the extent possible. You can receive payments via Paypal or Venmo. You can use a standard welcome email, create a list of FAQs, a standard lease template, etc. You should automate check-in/out too. Electronic lockboxes or smart locks can streamline check-in and make maintenance service calls easy too. I opt for a low-tech solution of a simple lockbox that my cleaner changes the code to each week, but it accomplishes the same purpose.

Lastly, when you don’t have someone to call and you don’t have a process for something, you always have a friend in Google. You will not be the first long distance beach rental owner and you will not likely be the last. Almost nothing you encounter will be unheard of, a simple web search can bring you to a blog like this or to an instructional video with a how to and step by steps for the problem you are facing.

While being at a distance from your investment property does pose some disadvantages, if you are willing to devote some time and effort these challenges can easily be mitigated.

A Sample Rental Agreement

Whether you book your property with a booking website (Airbnb, Homeaway, etc) or through a local property management agency, a rental agreement is used to finalize the legal relationship between you and your guests. These contracts establish the terms your guests agree to abide to when booking your place. If you procure renters “on your own” – whether friends or otherwise, it is still advisable that you use such an agreement.

A standard short-term rental agreement will list things such as the renter’s name and contact information, stipulate the rental rate, check-in and check-out times, house rules and obligations, and importantly what happens in case of the unexpected.

Download my rental agreement template, which I use for all my personal bookings, for a demonstration of the points that should be covered in an agreement.  You may and likely should modify for your own use (unless yours is a four-bedroom house in Ocean City, NJ). Now is probably the appropriate time for a disclaimer. Please see below!

The information contained on this website and in this post specifically is general “legalish” information and should be treated as such. You must not rely on the information on this website as an alternative to legal advice from your lawyer or other professional legal services provider. If you have any specific questions about any legal matter, you should consult your lawyer or other professional legal services provider.

With that out of the way, the template should give you a good idea of the areas that at a minimum your agreement should cover. Additionally, all of the changeable items in the lease (guest name, rate, address fields, etc) are text boxes where you click to enter text.  Hopefully, that part makes it easy to use.

Keep in mind, my rental agreement is for a beach house in Ocean City. If your place is a ski chalet in Vermont or a mansion in Maui, you would have different points to cover in some of these sections. There SHOULD be different rental contracts for different locales.

Once again, please do not use this without at least some modification and ultimately with final consultation by a legal professional.  Also, please comment if you think I left something out or take exception to something!

New Jersey 2019 Budget and New Taxes on Airbnb/VRBO Rentals

Lawmakers in New Jersey have passed a budget for fiscal year 2019 and as a result, one change affects the bottom line for hosts who choose to list New Jersey rentals on Airbnb or VRBO.

Beginning October 1, 2018, online rental marketplaces like Airbnb or VRBO must collect the state 6.625% sales tax, any applicable municipal taxes, and the 5% hotel occupancy fee.

Strangely, Airbnb does not seem disappointed by this bill.  The full article is here, but Josh Meltzer, head of Northeast public policy for Airbnb was happy the bill was passed.  The article quotes him as saying, “Airbnb has fought for years to ensure that the short-term rental community can contribute tax revenue to support public services throughout New Jersey.”

Airbnb already collects taxes in the New Jersey municipality of Jersey City, so you can expect Airbnb to collect the taxes and fees (Update here) on the front in for the guest…at least making this a non-issue for the host to worry about collecting and remitting.

 

However, it may have an impact on whether guests choose to find you through Airbnb or the local agency.  Oddly, the brick and mortar rental agencies are not required to collect a state sales tax…at this time.  You may have already seen my post touting Airbnb over local Ocean City rental agencies because of the latter’s exorbitant ~15% commissions.  This development changes that calculus.  The conclusion of that earlier post, was that the bonus of using Airbnb was that one could post a rate 11% less than the local agencies (Fox, Berger, etc.) and net the same amount of money.  6.625 + 5 = 11.625% and this effectively makes Airbnb and the local agencies awash, if not a bit worse, from a cost perspective in a rental transaction.  I will not need to adjust my rates, per say, as the renter will be charged the state taxes and fees on top of my rate (see the Jersey City example above) while the agency commission comes out of my rate.  However, it will be interesting to see what effect this has on the marketplace.  In 2018, I had just one week rented through a local agency.  I will update this post with what the 2019 number looks like when this is fleshed out.  The bottom-line is I am trying to maximize my return and this can do nothing but hurt the bottom-line.

How to Ensure You are Ready for the Rental Season: New Season Checklist

The unofficial start of the summer season is behind us and prime beach house rental season is about to start.  To ensure you are ready for the rental season, use this checklist I use to have our place ready to host guests.

New Season Checklist

Exterior

☐ Touch up paint or fully paint depending on condition

☐ Power wash outside

☐ Check screen doors for damage and ensure rollers move freely

☐ Check workability of beach chairs, umbrella and beach cart

☐ Check outside shower stall and hose

Interior

☐ Put away personal effects
(kid’s toys, toothbrushes, hats, etc.)

☐ Swap out owner comforters/pillows/bath rugs to renter versions

☐ Update welcome letter and house manual/guide

☐ Buy beach tags

☐ Carpet cleaning

☐ Change remote, clock and smoke detector batteries

☐ Inspect fire extinguishers

☐ Replace HVAC Air Filter

☐ Test Air Conditioner

☐ Replenish stock of soap and toilet paper our cleaner puts out
(we provide hand soap and a starter roll if none is left behind)

☐ Refresh any “labels” in house that need updating
(ex. Light switches, owner closet, leave washer door open when not in use, etc.)

☐ Restock area brochures and menus if needed

☐ Provide updated magazines (remove my home address!)

☐ Purchase and provide cleaner with welcome gifts for each guest

☐ Through house cleaning

Remember, an ounce of prevention is worth a pound of cure and attending to these items now can prevent a potential vacation disaster and an expensive in-season service call. Some of these tasks may be best performed in the fall at the conclusion of the rental season, but I leave that to your discretion.  The checklist can also be downloaded here: New Season Checklist.

 

Why You Should Greet Renters with a Welcome Letter

High season is almost here.  One thing you will want to make sure is up to date and on your refrigerator is a welcome letter for your guests.  Think of it as the absolute “Do’s and Don’ts” you want guests to remember during their stay in your property.

I recommend a House manual too.  House manuals are a great resource of information for your renters.  However, I have been places where, for one reason or the other, the house manual was hard enough to find that we only located it near the end of our visit. Usually, house manuals are a binder which, no matter where you keep it, will get moved around also if it is read at all.

By contrast, the refrigerator is always seen right away by nearly every occupant of your beach house.  People do not move things clipped on the refrigerator.  My suggestion would be you put up a one-page sheet that covers the essentials: Wi-Fi password, trash pickup details, and your hard and fast house rules.  Feel free to use my welcome_template.  I put mine in a plastic sheet protector for durability and to convey added significance.

Please comment if you think there are any points that are absolutely necessary to include that I might have missed.

 

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