Have you ever considered renting your home out for special events but not sure if it is right for you or where to even begin? We’ve compiled all the information you need to see if this is the right decision for you and what you need to do to prepare your home for an event!
Reasons to Rent Your Home As an Event Space
1. Earn Extra Income
The most appealing part of renting your home for events and short-term rentals is the potential to make additional income. Whether you’re gainfully employed or run the house with all its bells and whistles, your house can become a very lucrative transaction or extra income. Engaged couples and corporate planners spend anywhere from $2,500-30,000 a day on a unique event venue.
Renting your home for a week as a vacation rental can definitely put some money in your pocket. Renting your home for a one-day event often generates the same amount of income, if not more. Why skip town for a full weekend when you can take the afternoon off, return home that same night and sleep well knowing you were a big part of a fabulous evening! Often times, owners choose to only rent their homes by the day so they can still live in their home 365 days a year.
2. Write off home improvements
We all have a laundry list of home improvements that we just can’t seem to squeeze into our schedules. Always wanted to replace that old tired tile work for brand new terracotta? Thinking the bathroom needs a pick-me-up? When renting out your home for a private event, these to-dos can get placed back at the top of your list! This includes interior and exterior maintenance and other home improvements. By improving your home for your business, you can count these expenses as a tax write-off!
Most of the homes that rent for short term rentals have extremely high overhead like full-time ground keepers, high water bills, electric bills, property taxes, etc.
Being able to rent your home and consider it a business is a great opportunity for tax breaks.
- Pros: You can write-off home expenses, bills, and additional income.
- Cons: You will need (very likely) a commercial permit and a business license so check with your city and see if any restrictions apply.
3. Tax-Free income
Legally, if you rent out your full-time residence for less than 15 days in one year, this generated revenue is not considered a business and is 100% tax-free! When you rent your home less than 2 weeks a year you do not have to claim the additional income on your taxes. This means you can host quite a number of one-day events each year or several weekend rentals.
This tax break can offer a huge benefit for homeowners in high tax brackets.
If a homeowner’s net profit per event is $5,000 a day, that is $70,000 in tax-free income annually (not all bad).
- Pros: Tax-free income, no business license needed.
- Cons: You are limited to 14 rental days per year.
4. Hassle Free
Already thought about renting but confused by all the legal jargon? No problem, If you work with a professional event management team like Estate Weddings and Events (the leading event management team in Southern California) they know all of the zoning laws backward and forward and handle all of the necessary paperwork. An event management team knows what you want, what you don’t want and exactly what you’d like out of the event. You get to leave all of the negotiations, the contracts, the staff, and of course, the clean-up to them. Grab a glass of wine and watch those old episodes of Law and Order SVU you’ve been meaning to catch up on while the checks come in.
5. Advertise your Home & Increase Property Value
Planning on selling your home in the near future? We know it may be a while, so advertising your home as a film location can not only bring in some extra income but can even increase your property value if it gets featured in films and/or well-known advertisements. Trust us, it feels pretty awesome seeing your backyard on the big screen. It’s a huge selling factor to add to your property's resume.
6. Give Back
We all have a charity that strikes a special chord in our heart, whether yours concerns animals, children, health, etc. For some of us, we may donate time, funds or an afternoon to assist in hands-on work toward this unbelievable cause. For homeowners who list their homes as the ideal event space, this may also include helping out a non-profit in a BIG way. While plenty of these companies may have the notoriety of for-profit businesses, it doesn't mean their budgets share any of the same DNA. Donate your estate or provide further cost incentive for these altruistic celebrations and be a part of something tremendous. It's more than opening your heart, it's opening your home.
Are you interested in renting your home for events, but worried about the liability?
If you are nodding your head that's great because we are going to answer all your questions below. Renting your home to strangers can be a scary thing. What if something breaks? What if they spill on my brand new couch? What if someone gets injured? These are just a few of the many concerns we hear from homeowners and of course you have every right to be concerned. After all, it is your home.
If you decide to list your home with a venue management company like Estate Weddings and Events (EWE) then you know you are in good hands. They take many precautions to protect your home and you from all the potential risks that are out there. Here are a few of the important ways a venue management company can protect you:
Every client that rents your home is required to obtain special events insurance with a 2,000,000 general liability coverage. They also require the client to name you as additionally insured. They verify every policy to make sure the clients are within good standing before anyone is even allowed to step foot on your property.
Estate Weddings and Events also require the renters to not only provide coverage for the policyholder but to ensure that their guests are covered under that policy. For instance, many insurance companies will only cover the policyholder. So if the bride slips and falls and breaks her leg you’re covered, but if uncle Bob slips and falls you are not covered. EWE ensures that the proper policies and systems are in place so you are completely covered and do not have to worry about a thing.
Not only is the client required to obtain coverage, but every vendor that works on your property (caterer, rental company, DJ, photographer, etc.) must all carry the same 2,000,000 general liability coverage listing you as additionally insured. So if the caterer spills a gallon of oil on your brand new paving stones, their insurance will cover the cost to replace the damaged stones.
Vendor Policies & Procedures
It’s important to make sure you are covered and will be compensated for damages but why not avoid these things from happening in the first place?
An event management company should work with you to create a list of rules, policies, and systems that every vendor must sign before working on your property. Although the renter is responsible for any damages, if the vendors sign a list of rules and are aware of what they can and can't do from the beginning, we avoid many potential damages from ever occurring. It will also help to assure a smooth execution because everyone will know in advance what the expectations are.
Estate Weddings and Events will hold a refundable damage deposit on your behalf which will cover any minor damages. Typically the deposit is 50% of the location fee or a minimum of $3,500. Any damages that exceed the insurance deductible (which is covered by the security deposit) will be covered by the insurance. Estate Weddings and Events also work directly with the insurance provider to mitigate the damages so you don’t have to.
Limiting access to the property
If you are considering listing your home with a company like Estate Weddings and Events, a representative will come out and inspect your home. They will walk through the property with you and make suggestions on what should and should not be available to guests. They may encourage you to install locks on closets or bedrooms that are unavailable to guests. They may also stanchion off hallways and other areas that are not accessible to guests. Limiting access will limit liability.
Pre-Event & Post-Event Walk-through
Before and after every event, Estate Weddings and Events will have a representative conduct a walkthrough of the entire property and document any pre-existing damages by taking photographs and video. Following the event, they conduct another walk through and document any new damages that are the responsibility of the renter. With photographic and written documentation they are able to flesh out any concerns or unknowns and if the renter is or is not responsible for something found after the event.
Estate Weddings and Events will provide a professional cleaning crew after every event. It is the owner’s responsibility to have the home clean and tidy before each event but EWE will make sure the interior and exterior are cleaned and the home is returned to its original condition.
How Much Money Can I Make Renting My Home?
This may be your #1 question once you’ve had on your mind and it is often the hardest question to answer.
It's hard to put an exact number on this question considering estates rent anywhere from $2,500-$25,000+ a day.
Estate Weddings and Events manages properties throughout southern California and they estimate that income for events may range from about $3,000-$8,500 a day depending on the property.
Let’s take a look at some of the factors that would alter the rental price of an estate...
Here are several factors to consider when pricing out a location:
- Location: Where is your estate located?
- Capacity: What would the event capacity be?
- Accessibility: Is it easily accessible?
- Features: Are there any unique features?
- Amenities: What amenities are included and what would need to be provided?
Let us dive into each one and provide you with more detail...
Where is your estate located?
Is your property on an oceanfront cliff in Malibu or in a residential community 3 hours from the nearest hotel? Location, Location, Location (it really is a HUGE factor in pricing an estate).
Here are 3 examples where the location of the estate will greatly influence the price.
1. Malibu Oceanfront Estate
One of our most popular requests from renters is a private estate with beach access or an oceanfront view. Large properties that are sitting on prime oceanfront real estate will be extremely desirable and people will be willing to pay more for the view. Also, many oceanfront properties do not have a whole lot of land so neighbors tend to be very close, and this will most likely limit the number of events this particular home may be able to have (i.e. due to noise violations, and other laws).
So if you have a home that is located right on the water and is also relatively close to neighbors (note: very rare to have an oceanfront property without neighbors close-by, however, if you do, then your property just became more desirable), you would be looking at being able to safely rent your home about 8 days a year for a price tag in the range of $10,000-$20,000 a day.
2. Ranch Style Property in Temecula, California
You may have a beautiful ranch style property on acres of land, but it may be difficult to get to or it may be inconvenient for out-of-town guests (i.e. far from hotels, restaurants, shopping, airports, etc.). Don’t worry too much because there is definitely a large market for your property.
The great thing about your home/ranch is that we can rent it more frequently at a more affordable rate. Weddings with larger guest sizes of 300+ can’t often find a unique venue large enough to accommodate their wedding and reception, so a ranch style property becomes a high selling point. These types of locations often attract locals or people who live in nearby cities.
A ranch style property located in Temecula might range from $2,500-$6,000 per day.
3. Penthouse in Downtown Los Angeles
With downtown LA growing and more and more conventions coming into town, downtown LA is a highly desirable location, especially for corporate groups. Although penthouses tend to have small capacity limits (usually 50-70 guests) these properties can still demand a high price tag.
A penthouse in downtown LA or any major city will typically rent from $5,000-$15,000 per day.
What is the capacity and how does it affect the price?
The capacity of a location can vary greatly and properties that can accommodate more guests can often charge a higher rate for a higher guest count. The majority of estate locations vary in price depending on the guest count.
Here is a sample venue pricing structure:
- Up to 50 guests- $3,000
- Up to 100 guests- $4,000
- Up to 150 guests-$5,000
- Up to 200 guests - $6,000
So for a location that can only accommodate 50 guests, we may not be able to fluctuate the price based on guest count, but if the location can accommodate 300+, the property fee would increase accordingly.
Is your location easily accessible?
There are many times that a company like Estate Weddings and Events may receive images of a beautiful home and they go out to meet with the owner and not only is the property difficult to find, but there are narrow/windy roads, difficult access points, no parking or no place for a shuttle to drop-off and/or pick-up guests, etc. Accessibility is a key factor for many people when choosing a location.
If an experienced venue manager or client can't find it, then you have to think about the 100 guests who are coming in from out-of-town. If it becomes too much work for a potential renter to plan the logistics of transportation then they may decide the property is not worth the hassle.
Or if there are extra fees associated with renting open lots for parking, creating appropriate signage, etc. then the location needs to consider those added costs when determining the location price.
Are there any unique features to your home?
There are many “WOW” factors of many of the homes that are represented by Estate Weddings and Events, but properties with really unique features or a great story behind it, are often more desirable than just a pretty home (although we love pretty homes too).
For instance, the Chateau De Beverly Hills was the backdrop for the movie “In Time” with Justin Timberlake. Any location that has been in the movies will be considered more desirable, especially with corporations that are wining and dining their clients in California. Former celebrity homes also make for a great story.
Even if your home is not in Hollywood, some other great selling points are ocean views, beautiful pools, waterfalls, indoor reception spaces, built in bars, covered terraces, pocket doors, overnight accommodations for large groups, etc.
Do we have access to restrooms?
If the property doesn't offer access to any restrooms clients will need to rent them. Luxury restroom rentals can range from $1,500-$2,500 depending on the size and delivery fees.
The renter will consider this added cost when making their decision.
Are overnight accommodations available?
Overnight accommodations add a lot of value to a location. When people choose to get married at an estate they envision the wedding weekend full of celebrations. To offer a place to host the rehearsal, wedding and Sunday brunch is a huge bonus for both the clients and you.
Is there enough power on the property to properly execute an event without issues?
A generator is often needed at an estate to handle a large scale event, however, if the property is restricting access to a power source, the client will need to factor in a large commercial generator which can cost $1,000+.
Interior access? Are guests allowed to use the interior of your home?
If guests are limited to the outside only, then a designated place for the bridal party to get ready will need to be factored into the price as well as a backup plan for rain.
A tent is almost always needed as a backup plan, even for properties with interior access because most homes cannot accommodate a seated event for 100 guests inside.
However, if the guests have no interior access they will need a sequence of tents to accommodate all activities (note: this can get extremely pricey).
The Complete Guide to Turning Your Property into a Wedding Venue
Here are some great ideas on how to turn a house into a venue for weddings and events:
If you have a pool taking up most of the yard, you may think that you are out of luck, but a common trick of the trade is to use a temporary platform pool cover. While this isn’t exactly cheap for the client, it is something you may want to see if you are comfortable with in case a client is interested in this option. They can then use this space for the ceremony, reception dining, lounge furniture, dance floor, or really anything.
If your outdoor space is limited, the client may have to narrow down their guest list quite a bit or seat guests wherever tables may fit. There is a chance that not all guests will be seated in the same area.
If you do have some indoor space that would be large enough to host a ceremony or reception, you may want to find out the cost for having some furniture professionally removed. That way you may be able to convert your living room into additional event space.
Customize your Ceremony Location
If you’re trying to distinguish the reception area from the ceremony location you can create some permanent changes to your yard by adding a gazebo or archway. Or the client can provide their own backdrop, line the aisle with flowers, hang lanterns from trees, or other temporary decorations.
Provide Proper Lighting
If you have an outdoor porch light, it will hardly provide enough light for everyone. Plus, it isn't the most wedding appropriate lighting. You might want to consider adding permanent market lighting throughout the reception space or additional lighting fixtures. It will create a better event atmosphere.
Landscape the Yard
Now would be the time to get any projects done in your yard, including the ones you may have put off for years. Re-sod the lawn if you have some dead patches. Fix your broken fence. Power wash your deck. And most importantly, plant flowers that will bloom during wedding season (or buy already blooming flowers to plant right before the big day).
Just because the event may be outdoors, doesn’t mean that guests won’t be using the interior. A thorough cleaning will be needed throughout the house, including bedrooms. Guests may need to use a bedroom for nursing their young one, or maybe just to store guests’ coats and purses.
Your restrooms will be used non-stop, so you should make sure they can withstand the abuse, otherwise, the client will need to rent some additional restrooms.
Once again, if there are any home improvement projects on your list, this is the time to make them happen. Your carpets could use a cleaning. The house can use a fresh coat of paint. Maybe it is time you bought that new sofa for the living room.
Chances are your kitchen isn’t large enough for a caterer to use to prepare a meal for 100 guests, so they will likely need to build a field kitchen on site. This may mean they need to use part (or all) of your garage or another large space to cook everything for the event. So better clear out a space!
Where will guests park? Do you have space on your property or on your street? If you are allowing guests to park on site, make sure that the area is cleared and doesn’t have any hazards that could damage a car. You can also mark spots to make it easier on guests. If not, where is the nearest school, church, private or public parking lot? It is important to know where you can direct guests to park, even if that means shuttling them to the house.
How much power can your home provide? Is it enough to power lighting a DJ and catering equipment all at once? Know your limits because a generator may be needed (which can also be rented).
Local Laws & Insurance
Check to see if you can have parties at your residence? What is your local noise ordinance? If you are part of an HOA double check your bylaws to see if events are permitted.
Another important factor is to check your current insurance policy on your home. Does your insurance cover damages to the house as well as your guests?
Hire a Venue Manager
Most importantly, make sure your home is in trusted hands. Hire a management company to oversee all events, because let's face it, this isn’t something you want to worry about for every event. A management team will work on your behalf to ensure everything goes smoothly at your house so you can leave on event day knowing everything is taken care of.
If you happen to live in San Diego or southern California, Estate Weddings and Events has been managing private estates for almost a decade.
If your estate already has a management team or if you are a venue manager looking to generate more business for your estate venue sign up for a listing with Venuelust and receive qualified leads directly to your mailbox.