Our home owners association is considering renting out our facilities to earn extra income. I’m wondering if any of you have done this before and if you have any advice for me? Would really appreciate it!
We do it at our HOA, and it’s a good way to get some extra cash flow. But I do recommend only allowing residents to rent out the facilities instead of opening it up to the general public. This is because you don’t really have much control over the public and can’t penalize them in the same way as you can with your own residents.
I second what cascascassie said. In addition to that, I would also advise you to do the following:
1. Set a fair rental rate. You can ask your HOA manager for help with this one. But if you’re self-managed, I would say a good way to gauge the price point is to look at similar rentals in your area. You also have to make sure your revenue covers your expenses with some profit to spare.
2. Establish your rules. This includes the procedures residents must follow when they want to rent out a facility as well as general rules to follow when holding events. You might want to impose maximum occupancies, rules on whether or not alcohol is allowed, pet rules, rules for cleaning after renting, and rules about gate passes for guests (if you live in a gated community).
3. Have the renter sign a contract. This was our mistake when we first started renting out our pool. There was nothing in writing that outlined our agreement with the renter, so nothing could be traced or referred to. Get a good lawyer to draft your contract, too.
4. Don’t forget to advertise. When we first announced the rental scheme, we had requests that came flooding in for the first few weeks. After that, things started to lull significantly. Pretty soon, our rentals weren’t bringing in any revenue at all. We didn’t really give much thought into advertising, so people basically forgot that they could rent our facilities. Some homeowners didn’t even know rentals were available (we live in a pretty big community with about 500+ units). Even if it’s just a weekly announcement in your newsletter or a banner on your website, make sure people know your facilities are up for rent.
This is all based on personal experience as we’ve been renting out our facilities for a while now and I was one of the board members that spearheaded this project from the beginning. Hope you find these helpful.
Our condo recently did this too but we allowed people otuside of the association to rent out our amentiies too. Worked out just fine so long as you have a solid contract and a keen eye for inspections. A condo manager helps a lot too.