VRBO Rental Income in Avon

How much income can you make with a VRBO rental in Avon? Quite a bit. 1.3 million tourists visit the greater Avon area every year, half in winter and half in summer. And Avon is the heart of the valley, near Beaver Creek Ski Resort and just 15 minutes down the highway from Vail.

Let’s start with the average daily rate of $461 and the average occupancy of 42%. That’s $70,671 a year. What if you rent your home more aggressively? If you’re able to keep year round occupancy at 67% (this is the average in March), that would suggest an annual income of $112,737!

So far, so good. But we need to consider expenses, fees, and taxes.

VRBO charges $499 annually. If you’re only booking part time, you can also pay 5% per booking. In either event, you’ll have a 3% credit card processing fee. $10,000 of rental income is the tipping point where it makes more sense to just do the annual subscription (and if you’re renting year round in Avon, you’ll hit that mark very quickly). On their end, guests will pay a 5–15% service fee…not relevant for your calculations, but worth considering for the impact on the total rate a guest will pay.

Avon doesn’t collect sales or accommodation taxes from VRBO (or Airbnb, or any short term rental company). STR licensees are required to collect and remit 8% of the price paid for the rental of accommodations in the Town of Avon; 4% sales tax and 4% accommodations tax. They also must get a $75 STR Business License and renew it every year.

The largest two expenses are going to be the property itself and your time. For the property itself, you’ll need to take care of snow removal, lawn care, and general maintenance. You’ll have to budget to handle larger repairs like the room and septic. You’ll need to pay for insurance (which can be higher on a rental) and also utilities, along with yearly property taxes. A simple rule of thumb is to add 50% to the monthly 30year mortgage payment to calculate the total cost of ownership. Furthermore, you’ll need to hire a housekeeping service in between stays.

As a very rough gauge, call it $12,000 a year in assorted upkeep costs and $8,575 in taxes, credit card fees, licensing, and VRBO’s subscription fee. You’re keeping $50,000 out of that $70,061, which is more than enough to pay the mortgage and get a great place to vacation.

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