In this article I shall try and warn any owners away from joining a guaranteed rental scheme.
Like most people when they first make a villa purchase this sounds like a great idea and getting those 25 weeks a year is “easy”.
Firstly you get a crummy rate of around US$2000 per month. One you deduct your management companies fees, pest, lawn, the tourist tax (which suspiciously they sometimes forget to mention) at 12% there usually isn’t a great deal left. We often found that the remaining cash was obviously not enough to cover the mortgage but also not even enough to pay the utility bills. We kept with the scheme for 6 months as it at least generated some income and the property wouldn’t be running at a massive loss per month. Recently we visited our villa; the scheme had ended and we had changed management companies. I won’t go into detail about the whys and what happened, but sufficient to say we were fed up with how we were being treated.
Our villa looked the same from the outside but inside was a completely different matter. I should make it clear that as a property landlord in the UK I expect a bit of wear ‘n’ tear on a rental. On almost every wall were black scratches presumably from suitcases being banged and scratched as eager guests more in and out. Were we informed of this damage at the time, no? I found a poolside chair completely broke. What worries me most about this chair is that we initially bought very expensive and very, VERY sturdy ones. There is no way with normal use you could break it! I guess it was subjected to non-normal use and nobody (not the cleaner, or the supposed weekly management company inspection) noticed. There were stains on the carpet that couldn’t be removed. A big black stain on the suede sofa; someone had kindly turned the entire sofa cushion upside down so you wouldn’t see it; yeah thanks! . Lots of cracked grout in all the bathrooms; easy to fix, and sure due to wear ‘n’ tear – but nobody inform me! One of the pool alarms switches literally hanging by its wire out the wall; it still works but looks a tad scruffy! Nobody has the key to the “owners cupboard” (nope, I never got handed it) – though I would like to use it! So guess what? I go and buy tools & paint and end up fixing everything; including taking my own “owners’ cupboard” door off and replacing the lock. Ultimately it cost us a fair sum of money to put everything right and make the villa clean and fresh again. We have since decided that we’d rather have it empty than have it used like a cheap hotel. As far as I can see only the old management company would benefit; by charging the tour operator a much higher rate than the pittance that gets passed onto the owner. We shall never join a rental scheme again and shall never lower the rent severely just to get a guest in. In the long run these tactic’s and schemes are not beneficial to the owner and if you go down this route you will regret it.
Like most people when they first make a villa purchase this sounds like a great idea and getting those 25 weeks a year is “easy”.
Firstly you get a crummy rate of around US$2000 per month. One you deduct your management companies fees, pest, lawn, the tourist tax (which suspiciously they sometimes forget to mention) at 12% there usually isn’t a great deal left. We often found that the remaining cash was obviously not enough to cover the mortgage but also not even enough to pay the utility bills. We kept with the scheme for 6 months as it at least generated some income and the property wouldn’t be running at a massive loss per month. Recently we visited our villa; the scheme had ended and we had changed management companies. I won’t go into detail about the whys and what happened, but sufficient to say we were fed up with how we were being treated.
Our villa looked the same from the outside but inside was a completely different matter. I should make it clear that as a property landlord in the UK I expect a bit of wear ‘n’ tear on a rental. On almost every wall were black scratches presumably from suitcases being banged and scratched as eager guests more in and out. Were we informed of this damage at the time, no? I found a poolside chair completely broke. What worries me most about this chair is that we initially bought very expensive and very, VERY sturdy ones. There is no way with normal use you could break it! I guess it was subjected to non-normal use and nobody (not the cleaner, or the supposed weekly management company inspection) noticed. There were stains on the carpet that couldn’t be removed. A big black stain on the suede sofa; someone had kindly turned the entire sofa cushion upside down so you wouldn’t see it; yeah thanks! . Lots of cracked grout in all the bathrooms; easy to fix, and sure due to wear ‘n’ tear – but nobody inform me! One of the pool alarms switches literally hanging by its wire out the wall; it still works but looks a tad scruffy! Nobody has the key to the “owners cupboard” (nope, I never got handed it) – though I would like to use it! So guess what? I go and buy tools & paint and end up fixing everything; including taking my own “owners’ cupboard” door off and replacing the lock. Ultimately it cost us a fair sum of money to put everything right and make the villa clean and fresh again. We have since decided that we’d rather have it empty than have it used like a cheap hotel. As far as I can see only the old management company would benefit; by charging the tour operator a much higher rate than the pittance that gets passed onto the owner. We shall never join a rental scheme again and shall never lower the rent severely just to get a guest in. In the long run these tactic’s and schemes are not beneficial to the owner and if you go down this route you will regret it.