Interview with Mr. Miguel Ernand and Mr. Fred Ernand, COO and CEO respectively of Managing Service in Villars-sur-Ollon.
Is there a difference between renting out a residential or a vacation apartment?
There is indeed a very big difference between these types of rentals. The rental of a residential apartment is governed by firmly established rules. It is fairly easy to prevent problems by requesting an extract from a renter’s criminal record and prosecutions. The tenants rent for long periods. The accommodation is usually unfurnished, undecorated, and unequipped. The tenants do not usually move in or out during holiday periods (New Year). Once the tenant is in place, the manager is responsible in particular for controlling the regular payment of rent and maintenance work which is the responsibility of the owner. Over the years, the owners update the equipment knowing that it is easier to refurbish certain elements and do work between two rental periods to avoid interventions, and potentially litigation, during periods of occupation. When it comes to renting vacation apartments, the workload is different. The visits of potential candidates cannot be grouped, which generates several visits to each accommodation. In addition, the following tasks must be carried out: inventories and cleaning, very fast entry and exit, key management, explanations of the functioning of the household appliances and the equipment that is sometimes too technological for certain elderly or technophobic, but WiFi dependent customers. Any technical problems due to long periods of absence from the owners and the obsolescence of certain accommodation must be resolved. The manager must take care of obtaining security deposits, conflict management during the mixed use of a building where some are there to relax with family and others to celebrate loudly, at all hours of the night during a beautiful festive season, without considering the differences in mentality, languages, and countries… a short rental period varies from a long weekend to full season (4 months in winter – Christmas to Easter – or 2 months during the summer). Note also the time spent making the hosts discover all the activities offered by the resort. This type of rental concerns landlords who, for the most part, are forced to rent simply to meet costs that are not in line with the duration of their accommodation (usually less than 10 weeks).
Is a rental lease established for any type of rental? (Short term: weekly, monthly or seasonal)
A rental lease is established by the manager in both cases. The problem is that it is not easy to secure all the parameters of a short-term rental, especially when the tenant is a foreigner. Post-rental cost recovery issues can turn into a nightmare if overseas procedures are to be initiated. And in this case, the rental lease is of little help when the costs of prosecution are disproportionate to the amounts at stake.
Does the manager have to establish an ELE (inventory of entry) and an ELS (inventory of exit) for each rental?
Ideally yes, it would be necessary in both cases (rental of a residential apartment and rental of a vacation apartment). Again, when it comes to long or very long term rentals, the establishment of such documents is essential. On the other hand, it is almost impossible, because of the timeline, to establish these kinds of forms for vacation rentals because they are time-consuming. They should also be backed up by a full inventory. The latter is impossible to establish for dozens of apartments which, moreover, are rented at the same time. It remains to be trusted and to establish clearly dated photographic inventories to refer to it if unfortunately there were a problem. (But here again the question of responsibility arises. Indeed, which tenant of the season is responsible, the first or the fourth?
Is a rental deposit received?
A rental deposit is obviously received for these two types of rentals. It is deposited in a bank or made via an insurance company for the rental of a residential apartment. It is deposited with the agency in the case of short-term rentals. This is all the more reason to work with established insurance agencies (USPI members if possible). The rental deposit must in both cases be proportionate for the amount of the rent, and doubled with a guarantee of Civil Liability insurance of the tenant (valid in the EU zone for customers not domiciled in Switzerland)
What advice would you give to future vacation rental tenants?
We advise tenants of vacation accommodations to contact real estate agencies that have been established for a long time in the location chosen for their vacation. We also advise them to be wary of “exotic” proposals. When a rental seems particularly attractive compared to others, it is probably hiding something… Unfortunately, there is no such thing as a miracle. If you want something luxurious and comfortable, well placed in a renowned resort, the price is right. It is better to pay for a slightly higher “all inclusive” rental and be at ease rather than discovering that the proposal that seemed interesting is ultimately a rental whose conditions are “multipart”… .and when all final elements are added, represents a much higher final cost than when everything is clear and transparent from the start.
This interview was originally published on the website ofUSPI – Vaud.