Lexington, KY - In recent weeks signs enticing Central Kentuckians to rent their homes "For up to $5,000 per day" during the 2010 Alltech FEI World Equestrian Games began springing up like weeds in rights-of-way around this city.
"At least 500," have been confiscated by Lexington's Division of Code Enforcement according to its director David Jarvis. "We did some research and found out who they are and we've turned them over to the Attorney General's Office," he said.
The company Jarvis forwarded to Kentucky law enforcement for what appears to be at the very least a case of wide scale littering, is Arizona-based MajorEventRental.com. The company has a bevy of area homes listed for lease during the Games. Some of the homes listed on the site are modest homes in subdivisions and near the center of town that can be rented for thousands a day, and for a third to half of the home's mortgage for the run of the Games' 16-days.
"If you put in the work, the results will come," reads the header on MajorEventRental.com's listings for the Central Kentucky area. But the work is the job of your broker, according to Dana Martin, broker and owner of Event Home Leasing, the official home leasing partner of the WEG.
Event Home Leasing charges a $199 administration fee to the owners of all of their listed houses, Martin said. That fee covers the costs of licensed realtors composing home profiles for display online at http://www.eventhomeleasing.com/.
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In addition, when a home is rented a quarter of the rent is charged to the homeowner as a commission fee. According to a contract sent to from a person who dealt with MajorEventRental.com, an up-front charge of $1,195 was required, and if the house was rented, 17 percent of the cost would be sent to the Arizona company.
While it may seem like a deal to pay $1,195 to rent a home for thousands a day, Martin said the price points listed on MajorEventRental.com far exceed the reality she's found in the market.
"We've talked to hundreds and hundreds of people over the last year-and-a-half preparing for the World Equestrian Games and a lot of the people from all over the world, they are very budget conscious. It's a lot of money to come to the games, and if they can't fit it in their budget, then they may opt not to come," Martin said. "I just know from our perspective what that market will bear."
And what the market is bearing, Martin said, is on the high-end between $225 and $250 per bedroom, per night.
That means a five bedroom house, if rented at $250 per bedroom per night for all 16 days of the Games, would bring in $20,000. MajorEventRental.com, however, has a modest three bedroom, 1,500 square foot home in the 40511 zip code listed at $3,000 a night, more than twice the $1,250 per night Martin has rented five bedroom "luxury" homes for. The same house can be rented for the run of the Games for $48,000, according to the site.
A scan of MajorEventRental.com's listings does show some properties in the same price range of the current market, though not quite on the same scale. One listing, for a 1990s Class-C Motorhome parked in Versailles, is asking $21,000 for the run of the games. No daily price was listed.
"It's unrealistic to expect those numbers from anybody," Martin said. "What we try to give the home owners is the real perspective of what to expect financially."
Part of the management of expectations is that Martin's company, Event Home Leasing, stopped accepting applications for home listings in early May. "We just really need to focus right now on our tenants, our guests coming in. So that's our primary focus right now."
The company had around 800 listings, and so far has booked renters for about 100 of those homes. Those 100 range from one bedroom condos to large houses, similar to what Ryan Hardesty of WEG Home Rentals has managed to rent for his clients.
With a $295 listing fee and no commission, Hardesty said he's managed to rent around 25 of the 110 or so homes he has listed. "It's a fairly saturated market at this point," he said.
Homes he's successfully rented lately, he said, fall in the $500 a night range. But he too has rented everything from one bedroom condos to farms for the games.
A call to MajorEventRental.com asking about their process was not returned. The company's website boasts a "B" rating from the Central-Northern-Western-Arizona Better Business Bureau, though the BBB site states it is not an accredited company.
Both Martin and Hardesty said the original expectations of price and demand were higher than reality, as they have discovered in the process of renting homes. But they both want to make sure people that are looking to rent their homes in the last full month leading up to the games don't give away money because they have dollar signs in their eyes.
"Some people think this is going to be their silver bullet and they're going to make all of this money at the very end," Hardesty said. "They're kind of getting scammed, in my opinion."