Managing Your Rental Property The time has come for some renovations at my cottage in the Kawarthas. We’ve been renting out Osprey Cottage for three years now and have had a lot of success, with full occupancy in the summer and decent reservation rates the rest of the year, but it’s looking a bit tired in places. We are raising the rental rate in 2008 and I have to justify that with some significant improvements. Since we have it open for rentals year round, and December is quieter, I usually do a complete audit before Christmas so that I can set a budget for expenditure in the New Year. I can then look at the income for the previous year and forecast cash flow for the upcoming period. My audit is methodical. Room by room, we look critically at every aspect of the décor, equipment and supplies, furnishings and furniture, window and floor coverings, and all the peripheral things that contribute to a great experience for my renters. For example, we supply a range of board games, and guests have often commented how nice it is to have some traditional games to enjoy with their families – Scrabble, Monopoly, Cluedo etc. Over a summer of continuous use, pieces go missing, scorepads and pencils need replacing, and packs of cards become dog eared and scruffy. I buy new games each January in the post Christmas sales. Since we have many returning guests, I always like them to see upgrades, whether it is through adding more small appliances in the kitchen; buying new bed linens, or changing the books and DVDs in the library. It’s always gratifying to see comments in the guest book that show the upgrades are noticed and appreciated. Our major work next year is new flooring in the kitchen and I’m considering adding a sauna outside. The flooring may not bring in additional guests, but the sauna could pay for itself in more weekend bookings in the winter and fall. We installed a hot tub in 2005 and this contributed to increased occupancy in the low and shoulder seasons. Improvements have to justify their expense so the audit is a carefully controlled process. Doing it now gives a great opportunity to plan ahead and manage expenditure for the season carefully.
