🏝️ The Best Deals for Vacation Rentals and Homes.

I know many of you enjoy traveling (maybe even as much as I do), but sometimes, you want a place to stay that isn’t just a hotel. Finding the right option can take time because there are so many choices. A few weeks ago, I released a solo episode about vacation homes (🎧Ep86), and I was determined to make a practical guide so you can clearly understand your options and select the option the best one for you. I’ll break down all the options, from rentals and exchanges with little or no upfront costs to actual ownership options like fractions, destination clubs and timeshares.

Vacation rentals with "little/no upfront cost"

When you don’t have to pay any up-front costs, it’s all about the flexibility and simplicity of looking, choosing, and booking where you want to stay. 

🏡 Home rentals 

Home rentals are as it sounds. It's renting a property for a specified period (whether it is a house, villa, condo, or another unique-style property).

• Pros 

  • Ideal for one-off trips.

  • A wide range of options is available.

  • The booking process is straightforward.

• Cons

  • Quality and prices may vary (including fees).

  • You may find it challenging to regularly go back to the same place (since everyone else is competing with you).

  • Certain cities/counties have restrictions on short-term rentals, which might severely limit the supply for that region.

• Options

  • Airbnb, VRBO, and several other sites offer the broadest properties based on location, size, type, and preference.

  • AvantStay and Wander both provide properties with high-end design aesthetics and amenities. I have not used either service, but I am intrigued by them. Wander has 11 homes, most with fast wifi, EightSleep beds, a Peloton bike, a Tesla to drive, and multiple high-end workstations. (If you end up booking a place with Wander, email [email protected] and mention the podcast to get $250 off.)

  • There are also options for the highest-end homes, villas, and resorts. HVN and Villas of Distinction have extensive collections of properties worldwide. (HVN is currently invite-only, but it looks like you can access with a AAA membership here)

  • If you are looking to travel to a variety of places, there are also a lot of local sites and companies that have niche offers tailored to your needs.

• How it works

  • It is a one-time transaction (incl. fees) and you can sometimes get discounts if you stay longer.

• Pro tips

  • To get the lowest price, I suggest you save the image of the property you wish to rent, then do a reverse "Google image search" to find all sites that list the image. You can sort through the sites that offer the most affordable prices. For example, I found Merveil, which is a direct rental site for a few places I found in Paris on VRBO.

  • You can always negotiate, especially if it’s last minute or your stay perfectly fits into an opening (e.g. they have 6 nights free and you’ll take all 6 vs. book 4). Just email and ask for an offer. I just did this for an upcoming trip and got 15% off both our bookings.

🏠↔️🏡 Home exchanges 

Home exchanges differ from rentals because instead of spending money, you’re paying for your stay by letting someone else stay at your home. And some platforms have their own “currency” so you don’t need to stay in the home of the person staying in yours (or even exchange over the same dates). The variety and flexibility of exchange options are the true unlock to staying all over the world affordably and comfortably. And the personal experience can go beyond just access to someone’s home – sometimes you can use their transit passes, vehicles or they might even ask you to watch their pets. 

• Pros

  • The cheapest way to stay in vacation homes around the world.

  • When your home is empty, you can capture value and save money on future travel.

• Cons

  • Someone is staying in your house, room, and bed.

  • May need an extra insurance policy to cover your belongings.

• Options

  • Some of the most popular exchange sites are Home Exchange (← my referral link), Love Home Swap and People Like Us. They all offer multiple types of stays (see below), including non-reciprocal (my favorite)

  • If you already have a second home (including fractionals), there’s an exchange site exclusively focused on that called Third Home (← my referral link).

  • Amy and I have spent countless nights staying with hosts on Couchsurfing, a platform for locals wishing to meet and host travelers for free. We hosted a bunch of people to build up a great profile with a ton of reviews and then spent >100 nights couchsurfing on our trip around the world. It was truly the best experience getting to meet so many locals everywhere we went. We aren’t doing it anymore now that we’re traveling with the whole family, but if we were in our 20s again we’d be doing it all the time.

  • Finally, I recently joined My Place, which is like Airbnb, but you can only host or stay with friends and friends of friends. It’s like couchsurfing in that you don’t pay for the stay, but you can ask people to either cover basic costs (e.g. utilities) or pay for cleaning. However, since it’s not a rental service, they don't offer hosts any insurance policies like other sites might.

• How it works

  • Home exchanges come in a bunch of forms, but none of them have any nightly costs associated with them. However, some exchange sites have fees to support the service.

  • Simultaneous means you stay at someone’s house while they stay at yours. If you've seen the movie, The Holiday, you'll know exactly what this is. I had always assumed this was the only option for a home exchange. And in my head this required a lot of things to align (including finding someone who had a home in a place you wanted to go and agree to swap it at the same time you were traveling, and they also wanted to go wherever you lived). But fortunately it’s not the only option.

  • Non-simultaneous means that someone stays at your home while you are traveling, and then you can stay at their home at some future date. In essence, it's the same process as simultaneous, but the schedules don’t have to align. 

  • Non-reciprocal means you earn “currency” from an exchange site by having someone stay at your home, and you can then use that currency at another home in the program. This option is my favorite and most exchange sites now offer their own “currency” to make it possible.

  • Hospitality exchange is when you stay with someone else (while they are there), and then they stay with you (while you are there). In this option you're not getting the house to yourself, but you are getting to spend time with a local. It’s similar to Couchsurfing.

Pet/House Sitting

Thanks to one of our followers, Becky, for sharing this option. She’s used it for 7 different trips (44 nights total) and has had a great experience. For a modest fee, assuming you get through an application you can become a vetted house sitter to stay in homes around the world and often watch their pets as well.

• Pros

  • Can stay free around the world

  • Can stay during peak travel seasons when homeowners often take vacations.

• Cons

  • You often need to watch the owners’ pets (could be a plus for a lot of people).

  • You have to apply and be selected by the platform

  • It can be hard to get your first sit with no reviews (maybe you could get a friend to join the platform, pick you and leave a 5-star review)

• Options

  • The option Becky shared was Trusted Housesitters (← her referral link) and it’s $129/year (or 30% off with her link). She said that there are currently 5,500 sitting opportunities listed, with about 3,000 of those being in North America, 2,000 in Europe, and the rest all over the world. 

• How it works

  • It’s pretty straightforward. After being approved for the platform, you can browse the sitting opportunities (which include photos of the homes) and apply for ones you’re interested in.

Vacation rentals with "upfront costs"

With this category, you might lose some flexibility, but you usually get some type of ownership and future upside. Some of these programs can save you a ton in the long run (especially if it's the right fit for what you're looking for), while others might be a bad investment. I’ve decided to give all the options below one of two labels: equity represents the options where you benefit from the appreciation of the property and non-equity describes options where you don’t own the property and don’t benefit from its appreciation. 

➗ Fractional ownership (Equity)

Fractional ownership is a true deeded part-ownership in real estate.

• Pros 

  • Taking out a mortgage is an option.

  • A reliable schedule with a consistent place to go.

  • Can often store your belongings.

• Cons 

  • You will need to budget for annual dues to cover maintenance, property taxes, and utilities (roughly $5,000 to $25,000).

  • You only have access to one place unless it has an exchange pool.

• Options 

  • A do-it-yourself method in which you and a few family members or friends buy a home together and manage it together. 

  • In managed properties, a company handles the transaction, operates, and manages the property. 

    • This is the option that we chose. We worked with a company called Pacaso, and because I liked their product so much, I later asked them to partner with the podcast. In their model Pacaso will buy a home, furnish it, put it into an LLC with eight member interests, and sell those to buyers. Since you hold equity in the home, you can get a loan from the purchase and benefit from any appreciation (Pacaso resales have sold in an average of 12 days with a 12% annualized gain). Then they manage all aspects of the property, including cleaning, paying utilities and property taxes, landscaping, maintenance, and repairs. They usually have a system for scheduling and try to keep everything equitable between owners. And more importantly, you could leave things in on-site storage.

    • Another option I found interesting was My 5 Homes. It’s more expensive, but you end up owning a fraction of 5 different properties instead of just one. To make that possible the company pairs you with 20 other families who all buy those five properties together.

  • A private residence club is generally operated by a luxury hotel chain (such as the Four Seasons or Ritz Carlton) and offers amenities normally found in high-end hotels and resorts. Typically, you will also have access to partner resorts in the hospitality chain's portfolio. One example we looked at is The Orchard at Carneros which is related to Timber Resorts. While this is a real equity ownership, looking at historical real estate data, I didn’t see the property values appreciate much over the past few years.

    • One other perk is that you can usually rent out your stays through the resort management company if you won’t be using it. This lets you earn some extra money to offset any annual dues you pay for management or maintenance. 

    • Also, while I mentioned you can usually swap your weeks with their partner resorts, friends who’ve tried this have told me the availability is extremely limited, and it fills quickly.

• How it works

  • The big advantage of fractional ownership is that you qualify for a mortgage as it is a real estate purchase. The level of investment varies according to the size and location of the property. The range of options is anywhere from $50,000 at the low end to >$1 million at the high end.

📊Vacation Investment Real Estate Fund (Equity)

A vacation investment real estate fund is similar to investing in a private real estate deal, but you can stay in the properties. A company creates an investment fund to acquire properties and allows its investors to use those properties at a rate proportional to their investment. 

• Pros

  • You’re making an investment in a fund that expects to give a return to its investors.

  • When properties in the funds aren’t in use, they rent them out to cover all the ongoing costs or list them on Third Home (so you can exchange your time for other properties outside theirs).

  • You get access to 10-20 high-end properties around the world

• Cons

  • The upfront cost is high and because it’s a fund investment, you can't get a loan/mortgage like can with fractional ownership.

  • One of the significant differences in the fund approach is liquidity. Due to the 10-year investment term, you are locked in for a fixed period. You can still benefit from the appreciation of the portfolio but cannot easily sell your “investment”.

• Options

  • Equity Residences was the one that caught my attention during my research. Getting involved costs $200,000 for one to three weeks of use and an annual fee of a few thousand dollars. 

• How it works

  • Since this is an investment fund (and not a real estate purchase), you'll need cash to invest (sorry, no mortgage here).

🏠 Buying a second home (Equity)

You can’t be in two places at once, so unless you want to rent your second home out, I don’t think this option is the most financially optimal, so I won’t dive into it here.

🏝️ Destination Clubs (Non-equity)

Destination clubs offer members to pay a fee upfront to access a portfolio of residences (typically multi-bedroom, luxury homes with high-end concierge and hospitality services). 

• Pros

  • Unique homes you won't find anywhere else, usually with space for a large family (or two)

  • Many destination clubs offer concierge services with a turnkey nature.

• Cons

  • To get your value, you might need to be spending at least 4-8 weeks traveling a year and wanting to stay at very high-end properties.

  • Limited (if any) financing options for programs with up-front costs (though some of these options have little or no up front fees).

• Options

  • Fees plus pay-as-you-go. The biggest example here is Inspirato, which starts at $600 a month, and then you pay as you go for properties (which aren’t cheap). They also offer the Inspirato Pass, which they describe as the "first luxury travel subscription" worldwide. For $2,500 a month, you can book any of their properties and depending on how big/nice it is, they lock” your pass for a fixed number of days (e.g. their best properties can lock up the pass for >200 nights. Then, once unlocked, you can book another place.

  • Fee and dues only. There are a lot of options in this category, but one example is Exclusive Resorts. They charge $275,000 upfront and $36,000 a year in annual dues. It comes with 25 nights a year at their properties for the next 30 years.

• How it works

  • For destination clubs it varies between a low membership fee plus "pay as you use it" and a high membership fee with a limited number of uses. You can do more research using the Sherpa Report, which provides a comprehensive list of all destination clubs. 

  • Unfortunately, I don’t think we travel around the country/world enough (or need to stay at ridiculously nice properties) to get our value here.

⏱️🧳 Timeshares (Non-equity)

Timeshares are the most well-known of all these options (outside of home rentals). A timeshare is a right to use a property unit a set number of times each year or, in some cases, every week. Some variants include a vacation club, where you get a set number of points in a program each year.

• Pros

  • Lifetime use value (if you're willing to prepare well in advance and you want to come back for decades).

  • Exchange opportunities around the world (especially in programs like Hilton’s Grand Vacation Club that lets you earn Hilton points each year). One listener named Joel emailed me that he’s been able to use the Hilton points from his timeshare to stay all over the world (e.g. South Africa, Hong Kong, Bali, Maldives), often at high-end Hilton properties like the Conrad or Waldorf.

• Cons

  • Poor resale values (my parents inherited one, and it wasn't easy to get rid of it. When they couldn't sell or give it away, they had to pay the timeshare companies a few thousand dollars to take it back).

  • Many (but definitely not all) timeshare resort properties are a bit dated. 

• Options

  • You could buy new ones. The sales pitches are excellent. They usually offer a gift certificate, spa treatment, or something else of value to attend a presentation. But the advice online is consistent: if you're interested in a timeshare, you should rent it from owners who aren't using it or buy one for resale at a reasonable price.

  • You can use a site to rent from owners. They might make a profit, but if nothing else, they'll be able to cover their annual dues. Red Week, Tug2 and Koala are all rental sites.

  • Buy resale. You'd be amazed how many people are trying to sell their timeshares on those sites for as low as $1. Some will even pay you to take over the timeshare by covering a year or two in maintenance fees. Another listener named Bill shared that he was able to pick up three weeks in Hawaii as a resale for ~$2k (including annual maintenance dues and exchange fees), which worked out to less than $100 a night!

    • Note: when you buy a resale, some of the benefits (e.g., extended advanced booking window) that were offered to original owners might not transfer to the new owner.

• How it Works

  • For a timeshare it is an upfront investment package plus annual maintenance fees. They can vary widely depending on location, but the US average is $21,455, plus $1,000+ in maintenance fees per year.

  • For programs like Hilton’s Grand Vacation Club, you can effectively buy a Hilton Point annuity at a cost of $5-10 / point (e.g. $150k upfront might get you 1 million Hilton points each year). If this is interesting, you should check out this episode on the Geobreeze Travel podcast.

• Additional Thoughts

  • When it comes to sales pitches, be careful. If you’re confident you can walk away, I recommend checking them out and seeing how they work (and get a free dinner, spa treatment or whatever incentive they offer). But just know the deal sounds great, and they will put a lot of pressure on you to sign immediately. 

  • Despite having many exchange partners, they all tend to prioritize bookings to the properties' owners. It has been nearly impossible for my parents to book a property with the dates we want in the unit size we want if we don’t log into the website 13 months in advance at exactly 12:01 AM. However, I think if I dedicated more time to understanding the systems, this might be a different story.

  • Before buying any timeshares, do a lot of research. Joining the user forums and Facebook groups or finding other owners can help you make sure you’re going to get the full value you want.

  • It's best to try before you buy. If you're considering a timeshare, I recommend renting it first (or taking a subsidized trip that requires you to attend a timeshare pitch). Websites like Koala and Red Week make renting other people's timeshares so easy. You might realize that you could keep doing that every year and not need to buy one yourself

🏊 Non-home rental options (Non-equity)

I found two other interesting companies during this research that aren’t a perfect fit for this newsletter, but I thought were worth sharing. 

• Resort Pass lets you use all the amenities of a resort hotel (e.g. pool, cabanas, etc.) for a daily fee, without having to staying there.

• Swimply is like Airbnb for pools. Their marketing targets people who want to host parties for their kids or events. Besides pools, tennis courts, home gyms, and backyards, they're planning on expanding into other areas. 

😌 The feeling of validation

As I mentioned above, I purchased a fractional home through Pacaso, but I feared that I might end up second guessing the decision after doing all this. Thankfully, after 15 pages of research, I am now more confident in our decision to buy a Pacaso and excited for our next trip up there!

The content on this page is accurate as of the posting date; however, some of our partner offers may have expired.

Editor’s Note: Today, I’m grateful for the support of our partners Daffy, Vuori, DeleteMe, Inside Tracker and Pacaso. Opinions expressed here are the author's alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.