So what sort of things should you be thinking about with Phase 1 properties?

1. Financing – yes these can be financed. Depending on your usage (personal or rental) you will likely be offered a different rate. Most lenders aren’t fond of ‘nightly rentals’.
2. Revenues – what ranges can you expect for a 1,2,3+ bedroom unit? The average gross revenue you should expect for a decent 1 bedroom is approximately $65,000/yr. 2 bed is more like $95,000/yr, but then you jump up for 3 and 4’s, with a decent 3 bedroom (renovated, prime location) generating in the region of $140,000/yr. These are generalizations and obviously every property and its performance vary.
3. Rental Management – what are your options? Well that depends how ‘hands on’ you want to be. But Whistler has a vast array of management options, some starting from around $2000/yr plus commissions and cleaning and services, to full serviced management where they take 30% of gross revenues. Most absentee owners choose the upper level companies that charge between 25-30% for a hands off, professional experience.
4. Investment – are you looking for cash flow, equity growth or personal (you want to spend more time enjoying Whistler and using your property). As a general rule of thumb I like to tell my clients that most properties in this sector struggle to cover costs unless you’re putting down at least 50%. This might obviously vary depending on the interest rate you can obtain and a number of other factors. But lets say you’re looking at a $2MIL property and you have $1MIL to put down, leaving a $1MIL mortgage. With a 5% interest rate, that’s around $6000/mo in mortgage repayments alone. That means that just for the mortgage repayment you’d need to NET $72,000 a year in revenue. This is why I like to work backwards with my clients. I.e. how much capital are you looking to inject into the investment, and therefore what are your options based on your investment preference.
5. Location – where is better for rentals? Winter time brings the highest rental rates and therefore areas close to the ski hill will fare better than others. However, units in and around the village may provide better consistency throughout the year so you don’t ebb and flow as much. You’ll also pay a premium in terms of purchase price to be in a prime location, so at what point does it actually make sense to purchase a lesser property (location) and take the rental ‘hit’, which may still work out favourably as you’ve saved on the purchase price. These are all the things we need to discuss.
6. Amenities – on average, people prefer to have hot tub access when on vacation. It would pay to have one if you can. Some don’t like them, but if your goal is rental revenue then choose somewhere with one. Pools, not everyone cares about a pool, especially in winter, so these are less important than the hot tub, but I do have a post explaining exactly where you can find swimming pools in Whistler. What about things like storage lockers, or private garages.. is this for personal use or investment? You won’t find too many private garages near the ski hill unless you’re paying mega bucks so you need to think carefully on what’s important.
7. Insurance – so many people that operate a nightly rental business do so without proper insurance. a standard home policy does not cover the commercial operation you are doing. A short term rental policy can sometimes be an add on to your existing policy, with certain providers.
8. Business License – The Resort Municipality Of Whistler requires all short term rental operators to have a business license, which is a cost of approximately $165/year.