Insider’s view: Investing in vacation rentals in Marathon

Set among 13 islands in the tropical paradise of the Florida Keys, Marathon, FL is a city that offers an irresistible mix of natural beauty, recreational activities, and modern amenities. Known for its world-class boating activities and exceptional fishing opportunities, Marathon has carved out its niche as a popular destination for coastal getaways. This, combined with fantastic local attractions and experiences, has also turned the area into a haven for real estate investors looking to purchase vacation rentals in Marathon, FL.

WHY PEOPLE ARE CHOOSING RENTALS OVER HOTELS

In the ever-evolving landscape of travel and tourism, more and more tourists are opting for vacation rentals over traditional hotel stays. To comprehend this trend, it’s important to examine the four main reasons behind this preference:

Vacation rentals boast optimal privacy

Vacation rentals provide an unparalleled degree of privacy compared to hotels. Having entire properties at their disposal, guests can enjoy tranquility without concern for disturbances from adjacent rooms which is a common issue in busy hotels. This perk provided by vacation rentals in Marathon, FL appeals especially to people who want a secluded retreat where they have the chance to do what they want to do away from prying eyes, as well as those coming from the big city where quiet is a luxury.

Vacation rentals exude a “home away from home” feel

Vacation rentals offer an environment reminiscent of home, a feeling that hotels often find challenging to replicate. With amenities like spacious living areas, multiple bedrooms, and outdoor spaces, vacation rentals emulate the comforts of one’s own home. This familiar ambiance allows tourists to acclimate quickly, enhancing their overall vacation experience.

Vacation rentals provide greater freedom to cook and entertain

A distinguishing feature of vacation rentals is the inclusion of fully equipped kitchens and bigger indoor and outdoor living spaces. These features are especially useful for large groups visiting Marathon as they allow guests to prepare their meals and host gatherings – a refreshing alternative to dining out every night. Specific dietary requirements may also be easily accommodated, adding another layer of convenience to the vacation experience.

Vacation rentals offer better value for money

For families or groups, vacation rentals often prove to be more cost-effective than reserving multiple hotel rooms. The added features such as kitchens and laundry facilities translate to further savings on dining and other services. This cost-effectiveness is a significant factor for many tourists and contributes to the rising popularity of vacation rentals.

In light of these evolving tourist preferences, smart real estate investors have a unique opportunity to capitalize on this growing trend. After all, understanding and adapting to consumer behavior is a cornerstone of successful investing. By investing in vacation rentals in Marathon, FL, they get to cater to this increasing demand and generate significant returns. With the right property and a well-thought-out rental strategy, investors can tap into this lucrative market and reap substantial benefits.

UNDERSTANDING MARATHON’S VACATION RENTAL CRITERIA

Marathon, FL’s tourist industry is thriving and the city wants to ensure that the foundations behind its robust economy are well cared for. That’s why Marathon has a set of standards in place for putting up a vacation rental in the city. If you’re keen on investing in vacation rentals in this coastal city, it helps to learn about these rental criteria to guide you in your plans.

Here are some key points to consider:

• Minimum length of stay. In Marathon, the minimum stay in a vacation rental property is seven nights. However, this can vary if the property falls under a Homeowners Association (HOA) which has a different set of bylaws.

• Vacation rental property license. All vacation rental property owners are required to apply for a vacation rental property license before starting operations. This license ensures that their respective properties meet the necessary safety standards and comply with local regulations.

• If property owners choose to work with Marathon, FL real estate agents to manage their vacation rental, it is mandatory for the agents to hold a valid vacation rental agent license. This ensures that the agents are well-versed with local laws, can effectively manage the rental properties, and will provide high-quality service to guests.

Those making a real estate investment in Marathon should understand and comply with these standards. Once their vacation rental is up and running, they will have confidence knowing that they’re operating within legal parameters, maintaining high accommodation standards, and contributing positively to Marathon’s reputation as an excellent vacation rental location.

FACTORS DRIVING INVESTMENT IN MARATHON’S VACATION RENTALS

Several factors contribute to this growing interest among investors. These include:

• High demand for vacation rentals: According to rental data analytics firm AirDNA, Marathon shows a high occupancy rate year-round, indicating consistent and robust demand. Additionally, a study from Monroe County showed that 74% of tourists who visited a beach destination opted to rent a vacation home.

• Historically strong tourism sector: Thanks to this sector, investment in vacation rentals in Marathon, FL is constantly trending upward. The city boasts stunning coastlines and fantastic weather year-round, attracting millions of tourists to the area each year, especially during winter and summer. Many of these tourists opt to spend their respective vacations in rentals instead of hotels, thus keeping occupancy rates high and business strong.

• Potential for high returns: Given the massive demand and strong tourism sector, the potential for yielding generous returns from investing in vacation rentals in Marathon is high. Data from AirDNA shows that vacation rentals in the area see an average annual revenue of $55,300, with an average daily rate of $363.10. Of course, higher returns can be expected depending on the type of property used. For example, luxury vacation rentals in Marathon, Florida with good occupancy rates may be able to clear the average annual revenue of $55,300 consistently.

• Growing investment in local infrastructure and amenities: Marathon continues to invest in its infrastructure and amenities, further enhancing its appeal. From improved transportation links to the development of new attractions and facilities, these advancements make Marathon an even more attractive destination for tourists, indirectly boosting the demand for vacation rentals in the area.

Market trends and growth projections

Those keeping abreast with prevailing market trends recognize the huge potential of investing in vacation rentals in Marathon, FL. Marathon’s unique allure as a tourist destination, alongside the sturdy demand for vacation rentals, has resulted in high yields for this particular investment.

Making a real estate investment in Marathon begins with finding the perfect property to invest in. Looking at trends in the local housing market is a good way to start. Bargain hunters should be interested in picking up homes for sale in Marathon, considering how prices have slightly slid from last January’s $865,000 to this January’s $704,900, based on sale figures from Realtor.com. The outlook for Marathon, FL’s real estate market remains positive, though, with experts projecting sale prices to increase by around 18% over the next decade. Acquiring a Marathon investment property at current prices will be a smart move, given the rosy forecasts for Marathon’s housing market.

Prevailing trends in vacation rental preferences show an increasing popularity of eco-friendly and sustainable rentals. As environmental consciousness grows among travelers, properties that underscore sustainability – from energy-efficient appliances to water conservation measures – are gaining traction. As a result, homes with these eco-friendly features have become popular targets for converting into vacation rentals.

STRATEGIES FOR SUCCESSFUL INVESTMENT

The sunny skies, warm temperatures, and gorgeous coasts of the Florida Keys may be the ultimate tourist magnets but these don’t translate to a default win for investors of vacation rentals in Marathon, FL. They still need to be strategic if they want to maximize their return on investment.

1. Choose the right type of property to convert into a vacation rental. This will have a direct impact on the kind of guests the property will attract. To illustrate, luxury vacation rentals in Marathon, Florida are likely to attract affluent guests who will be looking for a place that is at par with their lifestyle. On the other hand, a standard single-family home may attract a wider demographic but you may also be making it available to potentially troublesome tenants.

2. List vacation rentals on other platforms apart from Airbnb. While Airbnb is a dominant player in the vacation rental market, it’s wise for property owners to diversify their listing platforms. This means also advertising on other prominent sites like VRBO or online travel agencies (OTAs) like Expedia, Trip Advisor, and Booking.com. Marketing vacation rentals through social media is a great way to get more inquiries and bookings, as well.

3. Establish a niche in the market. To do this, you need to find out what sets a property apart, as well as the specific audience to target. This involves researching what similar vacation rentals offer and identifying what’s missing in yours. For instance, there may be a demand for pet-friendly rentals that isn’t being filled or perhaps there’s only a small number of vacation rentals that offer private boat access. Offering these niche services can make certain properties the preferred choice over others.

4. Adjust pricing strategically. It helps to have a professional assisting you with the hard math involved here. Consider increasing prices during peak seasons and slightly lowering prices to undercut the competition during off-season months.

5. Work with a trusted property management company. This is especially important for investors who aren’t in Marathon too often. A trusted property management company has the capacity to handle everything from marketing the property to managing bookings and maintaining the property. They have the expertise and resources to optimize rental income and ensure the property meets all regulatory requirements. Additionally, they help to provide valuable insights into market trends and pricing strategies.

LEGAL AND PRACTICAL INSIGHTS TO KEEP IN MIND

1. Ensure that the home for sale is in the right land-use district. Not all homes in Marathon could be converted into vacation rentals. Investors must make sure that the purchased property is in the right location. For reference, vacation rentals are allowed in the following land-use districts:
   • Improved subdivisions
   • Urban residential mobile homes
   • Suburban residential areas
   • Mixed-use areas
   • Urban residential areas
   • Improved subdivision vacation rentals
   • Offshore islands

2. Adhere to noise ordinances. Marathon enforces noise ordinances from 11 PM to 7 AM. During these hours, no excessive noise should be detectable in a property’s boundary. To ensure compliance, vacation rental owners may want to incorporate this rule into their rental agreements and inform guests about this upon arrival. The installation of soundproofing materials or the designation of specific areas as quiet zones during these hours may also be considered.

3. Get all necessary insurance policies in order before renting out a property. Insurance for vacation rentals extends beyond the standard homeowner’s insurance. It is important to consider not only potential property damage but also liability coverage. The latter protects owners if a guest sustains an injury while on the property. It is recommended that vacation rental owners consult with an insurance agent experienced in this sector to ensure comprehensive coverage.

4. Fortify the vacation rental to withstand hurricanes. Given Marathon’s location in a hurricane-prone area, vacation rental owners must have a comprehensive plan for hurricane season. This includes equipping properties with hurricane shutters or impact-resistant windows to protect against flying debris, securing or storing outdoor furniture, and having a generator on standby in case of power outages. Owners should also establish a contingency plan for guests which may involve preparing an evacuation guide, providing information on what to do in case of a hurricane warning or watch, and having a policy in place for cancellations or rescheduling due to hurricanes.

5. Know the taxes related to vacation rentals in Marathon. Vacation rental owners are required to collect a tourist tax from their guests, aside from the state sales tax. Known as the Tourist Development Tax, this is levied on all rentals that are rented out for six months or less. In Marathon, it’s set at 5% of the total rent paid by guests, inclusive of additional fees that are part of the rental charge. The collected tax must be remitted to the Monroe County Tax Collector.

EXPERT ADVICE AND RESOURCES

For investors venturing into the vacation rental market for the first time, gaining insights from Marathon, FL real estate agents plus leveraging valuable online resources can make the prospect less daunting. That said, here is some advice from real estate experts to ensure you invest in the right property:

• Location matters: The appeal of your property significantly hinges on its location. Properties near key attractions like beaches, marinas, or lively downtown areas tend to attract more tourists, leading to higher occupancy rates.

• Understand your preferred target market: Knowing your intended target market will give you an idea of features and amenities to look for while searching for available homes. A fully decked-out patio with an outdoor kitchen is great for attracting families while more affluent guests will likely be more enticed to book a vacation rental that features spa-style bathrooms, home theaters, and the like.

• Factor in all costs before committing: The price tag on a potential property isn’t the only fee to prepare for when investing in real estate in Marathon. There’s also the matter of various insurance policies, maintenance costs, and potential extended vacancies to consider, among many others. As such, investors should factor these in when calculating their budget and the potential profitability of a vacation rental before purchasing.

When it comes to online resources and tools that can provide valuable information about the vacation rental market in Marathon, consider looking at the city’s official website and its chamber of commerce. Independent sites like Zillow, Trulia, and Realtor.com could help, too.

FIND THE PERFECT VACATION RENTAL IN MARATHON WITH ANGEL DIGIORGIO

When putting a substantial investment into the Marathon real estate market, it pays to work with the expert in luxury properties in the Florida Keys – top Realtor and long-time resident, Angel DiGiorgio. She and her team know everything there is to know about the area which is valuable in making informed decisions once you decide to invest in vacation rentals in the Keys. This, combined with 24/7 availability and proven methods, has helped the company become one of the most trusted names in Marathon.

Ready to get into the vacation rental market in Marathon? Don’t hesitate to contact Angel DiGiorgio at 305.509.0971 or send her an email.