By: Mike Kennedy mkennedy@railey.com 301-616-6106 June 18th, 2009 Category: 1031 Tax Deferred Exchanges, Deep Creek Lake Buyer Info, Deep Creek Lake Market Update, Vacation Rentals

Railey Mountain Lake Vacations, Deep Creek’s largest vacation rental company, is reporting that the vacation rental market at Deep Creek Lake is faring much better than other resort areas around the country.  With the slumping economy, vacation rental bookings are down nationwide about 18% from last year. In the Deep Creek Lake area rental bookings are only down about 10% from last year.

Other current happenings in the local vacation rental market include;

• - A positive sign is that 40% of all Railey Mountain Lake homeowners are ahead o f last year’s numbers. Not everyone is feeling the pain of this current slowdown. The other 60% are at the same level or down slightly.
• - On average each rental home is down about a week and a half of bookings this summer season.
• - The larger homes - the 9 bedroom and 8 bedroom homes - are still going strong. The 5 bedroom and 6 bedroom homes are currently lagging.
• - Renters are booking later and willing to sacrifice amenities for a lower price. Price is trumping everything right now to get bookings. If a property is priced properly compared to its competitors it will rent!
• - Some homeowners are being more flexible on restrictions to attract renters as well - such as allowing pets.
• - One of Railey Mountain Lake’s 9 bedroom pool houses set a record and went over $200,000 in gross rental bookings for the year.

In other positive news, future bookings for the 2009 fall season are already up 15% over last year. This may be due to the lower rates in the fall season and the fact the weather at Deep Creek in September and October is still very pleasant although certainly not hot by any means.

If you are thinking about renting your house or purchasing a vacation rental as an investment in the Garrett County area - give us a call at (800) 544-2425 or drop us an e-mail - there are some well performing rental houses currently for sale in the Deep Creek Lake area - as well as some houses that could be excellent rentals with some slight modifications. We’ve helped many clients over the years buy rental homes - we’ll be more than happy to get the buying process started for you as well. For those of you considering or in the middle of a 1031 tax deferred exchange this is one of the better performing resort markets in the country. Now is a great time to consider investing in real estate at Deep Creek Lake - inventory is up, interest rates are down, and there are some deals to be had.

By: DebraSavage dsavage@railey.com 301-616-4085 February 27th, 2009 Category: Deep Creek Lake Buyer Info, Vacation Rentals

How are some vacation rental homes at Deep Creek Lake doing?

Just like most things in life, “some have it and some don’t”, or so the saying goes.

With today’s tightening lending market many wonder; are there homes for sale at Deep Creek Lake that have great rental income that you can purchase to help offset the expense of second home ownership?

One such example would be 335 Waterfront Greens Drive (GA6806172). This 5 bedroom/5 bath home offers abundant vacation opportunities and great rental history. This home produced over $55,000 in gross rental income in 2008

This home offers lake access, indoor swimming pool and use of the Waterfront Greens: Par 3 Nine Hole Golf Course, tennis courts, mini golf course, club house for get-togethers or card games by the fireplace, canoe and kayak racks, winter sled riding hill and lots of walking paths and open space.

With the indoor swimming pool and all the amenities offered within the Waterfront Greens Community this is a renter’s or owner’s paradise. All these fun activities await you right outside the door. All this tucked in the quiet, relaxing and sunny cove of Beckman’s Peninsula.

Let’s run some numbers - but first things first - if you are going to finance part of your purchase locking in your interest rate now while rates are currently low will help secure your payment.

Purchase Price=$799,000
Mortgage Principal after 20% Down= $639,200
Monthly Payment=$ 4040.18
(Based upon APR of 6.5% for a 30 year mortgage on $639,200.00)

Annual (Principal and Interest) Mortgage Payment= $ 48,482.16
Annual Rental Income in 2008=$55,000+

Cha Ching!!!!! You now own a second home and real estate at beautiful Deep Creek Lake, use it for your families personal enjoyment, according to your schedule, allow guests to use the home the remainder of the time and your mortgage gets paid. Now that’s what it is all about!

Of course like anything in life, nothing is guaranteed so take into consideration that rental bookings can either increase or decrease. But locking in your mortgage rate makes one less variable you will need to deal with while owning a second home at Deep Creek Lake!

By: JonBell jbell@railey.com 301-501-0735 February 11th, 2009 Category: Deep Creek Lake Buyer Info, Vacation Rentals

Did you know that a pool table / game room in a vacation rental home brings in an additional $225+/- in rental income per week?

If you are in the market to buy a vacation home in the Deep Creek Lake area you should know that renting to vacationers can offset some of the expenses of owning a second home. Because of the area’s four season activities and close proximity to several major metropolitan areas, the Deep Creek Lake vacation rental market is alive and growing rapidly. Renting your home to vacationers can be a fairly easy process with the help of our sister company, Railey Mountain Lake Vacations - the largest full service vacation rental agency  in the Deep Creek Lake area.

So, what should you consider when buying a vacation rental home?

A recent Penn State Study by Jon Nelson examines the rent premiums for prime Deep Creek Lake locations. You can read a summary of his report on Jon Bell’s Deep Creek Lake Real Estate blog or email Jon Nelson at jpn@psu.edu for a complete copy.

Buying the right property is very important. Working with your real estate agent, you will need to do some homework before you decide which property to purchase. If a property had previously been on the rental market, your agent should be able to provide a copy of the rental history, showing an exact income statement for the house. If the property has no rental history, a rental projection from the rental company of your choice showing a high and a low projected rental income can be made available.

Please feel free to email me at jbell@railey.com if you have any questions or if you would like to schedule an appointment to meet and take a look at any property that sparks your interest.

By: Mike Kennedy mkennedy@railey.com 301-616-6106 April 17th, 2008 Category: Deep Creek Lake Buyer Info, Vacation Rentals

If you currently own a vacation rental home at Deep Creek Lake or considering purchasing one - there are a few interesting trends and insights that continue to evolve in our resort real estate market.

RENTAL BOOKINGS UP

Railey Mountain Lake Vacations reports that rental bookings are up about 7% this year compared to last year - even with the price of gas reaching record highs. Most local business owners have said that the Deep Creek Lake area actually benefits when the price of gas goes up - the reason being is that vacationers from Baltimore/DC and Pittsburgh actually choose to drive the shorter distance to Deep Creek for their summer vacation as opposed to the Outer Banks, Myrtle Beach, the Grand Canyon, or Disney World in Florida.

Larger Rental Homes Still Doing Well

Another trend reported is that the larger homes (8 or 9 bedrooms), with amenities such as an indoor pool, are still doing extremely well - and most continue to see annual owner gross rents increase. In fact one of the larger “pool houses” with an incredible lake view will probably generate gross rents in excess of $200,000 in 2008 - which would be the first time a rental home has broken that barrier. This proves that you don’t really have to be lakefront to be one of the better rental homes - an incredible lake view is something most renters desire.  Since most of these larger rental homes get rented on the weekends during the non-summer months - Railey Mountain Lake Vacations is now pushing mid-week corporate retreats that will probably increase the gross rents even higher in these homes.

The “WOW” Factors

If you are considering purchasing a vacation home at Deep Creek Lake and want to maximize rental revenue below are the “wow” factors that make a good vacation rental home;

• Updated and Above Average Decor - this may be the most important thing to have in your home. Renters want a certain standard of furnishings in a home they rent. This can make a tremendous difference in the amount of rental income you can generate.
• Lake Front or Lake Access Setting.
• Log Cabin - people really like that warm, cozy feeling of a cabin in the woods.
• Big Views of the Lake or Mountains - people want to be blown away by a view they can’t get back at home.
• Private Indoor Pool.
• Home Theatre.

Some factors that detract renters - or the “Un-Wow” factors (if that is such a word);

• The setting is “too” residential.
• Duplex/Townhouse/or Condo - most renters want privacy on their vacation.
• The Interior and Decor are below minimal standards.
• No Access to Deep Creek Lake.

Real Estate Opportunities

Railey Mountain Lake Vacations reports their is still great rental demand for larger rental homes at Deep Creek Lake - 8 bedrooms or more. Our inventory of larger rental homes has not grown much at all since 2003 when more restrictive zoning measures were enacted. Their are still opportunities in this current real estate market to take advantage of this trend. You could (1) buy an existing rental home for sale that already has good rents, (2) buy a really good lot and build, or (3) buy an existing home for sale and modify it so it can be a good rental. Finding an existing rental home with a high rental history is sometimes difficult - the good ones usually get snapped up right way. The more likely path to owning a good rental home would be to either build a new house or renovate an existing one. New construction obviously has a time element involved - but there are currently some really good lake view lots for sale at price points that could make sense building a new house - even if you have the added cost of a sprinkler system and other fire code measures that are required today.

Modifying or renovating an existing house is certainly another option to consider. One of our clients purchased a lake access home with a decent view of the lake a year or so ago - then added an indoor pool and now has annual gross rents exceeding $90,000. 

We hope these vacation rental trends continue. No one would have ever predicted the houses with indoor pools would have annual gross rents between $150,000-$200,000 - but it is happening. What’s the next big thing for these rental homes? Who knows - maybe an indoor bowling lane?