The vacation rental business matures
Every summer when 24-year-old Trevor Plencner was growing up, his family traveled to New Buffalo, Michigan, where they rented a house on Lake Michigan. Year after year, Mr. Plencner became more and more intrigued by the idea of owning a vacation rental property himself, so much so that he decided to give it a try.
In February 2018, when he was 20, Mr. Plencner purchased a vacation rental in Lake Geneva, Wisconsin, about an hour northwest of his home in Hoffman Estates, Illinois. and at the right time, Mr. Plencner bought a 1,200 square foot cottage a few blocks from the water for $ 111,000. He put in 3.5% using a loan from the Federal Housing Administration. Six months later, after painting and furnishing the interior and remodeling the basement, Mr. Plencner put the chalet on the booking sites. In the summer, its rate per night is around $ 400; in winter it is closer to $ 175. To his delight, the rental income from the three-bedroom house began to cover the mortgage, and then some. In June 2019, he bought a second property on Lake Geneva with a friend for $ 85,000.
Vacation rentals are his side business — Mr. Plencner works full time at Chicago O’Hare International Airport. His goal is to work only in real estate, with properties all over Wisconsin. “Vacation rental is the best business anyone can get into, especially young people,” he says.
Many of Mr. Plencner’s peers agree: Young adult vacation rental ownership is on the rise. According to Evolve, a Denver-based vacation rental and hotel management company, the proportion of its owners under the age of 30 increased by 100% between June 2019 and June 2021. In comparison, the proportion of its customers between 31 and 56 years only increased by 17% during this period. period and the proportion of homeowners aged 57 to 75 fell by 11%. Evolve properties can be booked through its own website and marketplaces, including Airbnb, Booking.com and Vrbo.
“This is clearly a growing segment,” said Brian Egan, CEO and co-founder of Evolve.