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Rent versus Exchanging for Credits through International Vacation Home Exchange:

If you have a holiday villa, cottage, yacht, lodge, cabin or any type of vacation rental and like travelling yourself, then our credits system will give you more value than your vacation rental income, this does not mean you should never rent out your property, it just means that for 1, 2 or more weeks a year, the credits you earn are worth more than the rental income for that time.

For example, see below:
Example assumes 12% deductible running cost, 15% rental management fee and a 25% tax bracket (but not taking into account any local taxes payable):

If you rent out your vacation property for $2,000/week, you will have $1122, to spend on your own travel. For you to rent a $2,000/week property when you travel would therefore cost an additional $878

By hosting an International Vacation Home Exchange member in your $2,000/week property, you will receive 20 credits, and with 20 credits you can stay in a $2,000/week property for a transaction fee of $140.

Example 1Renting your propertyUsing Credits
Weekly rental value $200020 credits
Running costs @ 20%$400$400*
Rental management fee @ 15%$300$0
Tax @ 25%$325$0
Leaves you with$97520 credits
Cost of renting equivalent vacation home$200020 credits
Additional cost to you for your holiday $1025$0
Transaction fee for equivalent property$0$140
Cost of your holiday$1025$540*

That is a saving of $485 or more if you are in a higher tax bracket.
* Probably tax deductible

Example 2Renting your propertyUsing Credits
Weekly rental value $400040 credits
Running costs @ 20% $800$800
Rental management fee @ 15%$600$0
Tax @ 25%$650$0
Leaves you with$195040 credits
Cost of renting equivalent vacation home$400040 credits
Additional cost to you for your holiday $2050$
Transaction fee for equivalent property$0$280
Cost of your holiday$2050$1080

That is a saving of $970 or more if you are in a higher tax bracket.

The above examples are for illustrative purposes only as everyone's outgoing will be different and we recommend you make your own calculations applicable to your property.

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