The vacation rental market is booming, with more guests choosing vacation properties over traditional hotels. After the COVID-19 outbreak, the market has witnessed a 30% growth, which is undoubtedly a staggering figure. Moreover, many vacation property owners make over $1 million a year by renting their properties.
So, after reading the statistics, you might also be interested in buying and renting a property. However, the process is easier said than done.
Before entering the market, you must create a robust vacation home management plan. This management plan will ensure everything is on track without significant roadblocks.
This article will discuss everything you should know about vacation rental property management. Make sure you read this article to the end to know more.
We believe you’ve heard of Airbnb and probably used it at some point. Other short-term rental sites, like Airbnb, too provide excellent opportunities for rental property owners.
They help vacation rental property owners rent out their apartments, condos, homes, and even land. They provide their services to people looking for a place to stay. The rentals can last anywhere between a day and a couple of weeks.
Renting out vacation properties can prove to be an excellent passive income. Thanks to the remote managing facility, you won’t face any problems managing your property. However, there’s a catch.
You cannot handle the whole vacation rental property management process alone. Who will collect the rent, consider maintenance, and handle customer queries? This is where hiring a third-party company comes into the picture.
Remember that everything depends on your specific needs and the time you plan to devote. This is an important thing you need to consider before hiring a property manager. Determine if you’re capable of handling tasks on your own or require professional help.
If you need help handling the maintenance, rent collection, documentation, and customer support, we strongly recommend hiring a vacation rental property management company. They will streamline various aspects of your rental business.
However, don’t back off thinking about the additional payment. You may think that paying a property management company will affect your revenue. But in reality, the results are quite the opposite.
They will help you save time, money, and effort in the long run. They will manage everything, reducing your hassle. This way, you can enjoy passive rental income from your investment effortlessly.
When planning to manage a vacation rental property, you must focus on a strategic approach. Despite your strategy, your ultimate goal is to ensure you receive positive reviews. This will improve your return on investment.
There are some key strategies to manage your vacation rental properties. Following them will help you avoid any roadblocks. Let’s take a look at them.
Research the local rental regulations before you purchase a vacation rental property. This is one of the most critical steps you need to remember. Many people neglect the legal and tax implications, ultimately facing hefty fines.
Depending on the state, some rental policies don’t have any ROI limitations. For example, some states allow vacation rentals to be occupied for 30 days, while others don’t.
In terms of taxation, things get complicated. If your vacation rental property is rented for more than 14 days a year, you need to report the revenue you generated. However, the operational and management costs are deductible.
When planning vacation rental property management, you must calculate the overall costs. Generally, the initial costs are more expensive. You need to consider security, furnishing, aesthetics, and many more. We recommend comparing costs before you run your rental property.
After you plan the initial costs, you need to pay close attention to the ongoing costs. Remember that vacation rental properties aren’t a one-time investment. They will need maintenance and repair throughout the entire year.
Moreover, property management fees may also be high. The combined maintenance and utilities can easily cost you thousands of dollars annually. Planning this step will prevent you from facing any financial problems later on.
Your clients will judge your vacation rental property based on its cleanliness. No one wants to spend their vacation in a filthy rental property, and if they don’t like the cleanliness, they will immediately move on.
Remember to hire a cleaning company to handle this task. Schedule cleaning services between the bookings. This way, you can make the space look well-maintained and healthy for the guests.
If you want to boost the guest experience, smart home appliances are the key. They can undoubtedly streamline your vacation rental property management price, making your property more eye-catching to the guests.
For example, you can install a smart thermostat. While it may be slightly expensive, it can cost energy to a great extent. Your guests also don’t need to control the temperature manually.
Apart from that, we suggest you install smart locks. These locks can automate the check-in and check-out process. Your guests will have a unique code to enter your property, which can be exchanged during the booking.
This is another important step in vacation rental property management that you must remember. Failing to create a pricing strategy will cause many problems. You may end up overcharging or allowing the rental to be too cheap.
Pricing will depend on location, property size, convenience, amenities, facilities, etc. With the right vacation rental property data, you can choose the perfect initial rates and revise them according to demand and seasons.
But how can you choose the perfect vacation rental property rate? Simple – research the market. Understand how much similar properties near your location are charging. But don’t compare properties in other states.
Also, close attention should be paid to operational costs and occupancy rates. Your rental property should generate enough revenue, but higher rents will do more damage. With seasonal demands, you can justify the pricing.
No matter how well-managed your property is, marketing is essential. You cannot get enough guests if they don’t know about your property. This is why marketing should be one of your biggest priorities.
You can use booking sites like VRBO or Airbnb to boost visibility. These platforms attract worldwide audiences, allowing your property to receive exposure. But, you need to stand apart from the crowd.
This is where online listing gets a little competitive. We suggest you upload high-quality photos of your vacation rental property. From the bedroom to the terrace, photograph everything. You also need to write a compelling description.
Managing your vacation rental property all alone will be tough. Sometimes, you will face various problems juggling between different things. And if you’re a beginner, completing the tasks without making mistakes is impossible.
Thus, you need to use a vacation rental property management platform. These platforms are highly effective at automating various tasks. For example, you can automate the customer support and document management process.
However, you need to ensure you’re choosing the right platform. They often deal with sensitive data, so having a reliable and credible partner is a must.
As mentioned, managing vacation rental properties will be extremely tiring and time-consuming. You must also handle various responsibilities, from collecting rent to marketing your property.
So, why not let a professional handle such complicated tasks? A vacation rental property management company can easily handle operational tasks. A vacation rental property manager has extensive experience ensuring your property runs smoothly.
As the owner of the vacation rental property, your primary goal might be keeping your property booked all the time. You want a healthy flow of guests who will help you generate solid revenue. However, attracting guests is not easy.
You need to consider various marketing strategies. For example, you can use digital marketing to spread the word and distribute across channels. But when you contact a property management company, they will easily handle the tasks.
They can easily list your vacation rental properties and boost your exposure across various targeted locations and networks, ultimately enhancing occupancy rates.
Moreover, they will use dynamic pricing algorithms. They will pay close attention to the market data so that you can set the perfect pricing structure for your rental properties. With exposure and pricing adjustments, your occupancy rates will become higher.
You must ensure your rental property is well-maintained between guest stays. Failing to do that will cause huge problems. The maintenance list includes various factors, and a property management company can take care of them.
For example, property management companies provide dedicated personnel to restore your property to its optimal condition. They ensure faster turnaround times, which will help you easily process the next bookings.
They can do everything from maintaining the overall aesthetics to repairing the HVAC systems. You don’t need to worry about these things with a reputed vacation rental property management company.
On top of that, the vacation rental managers will provide 24/7 customer service. Whether your guests call you at night or day, the professionals will handle them and solve their queries.
Apart from property maintenance, rental property management companies can also improve the overall guest experience. They will focus on the guests' overall satisfaction, from check-in to stay.
Moreover, they will answer all the questions swiftly. Your guests won't be disappointed if they have any special requests. As a result, this will improve their staying experience.
So, what’s the benefit of that? Firstly, they will choose your rental property over others, given their experience. Second, they will give feedback about your property to other people. This will lead to word-of-mouth marketing.
Self-managing vacation rental properties is undoubtedly a hassle. There are too many headaches, especially rent collection, document collection, verification, etc. Constant property monitoring will add another headache.
Soon, your rental property management will become a full-time job. It will lead to burnout, as managing various properties is highly challenging.
When you hire vacation rental management services, they will ease your burden. Their skills in handling various property management tasks will prove super beneficial. Thus, you can sit back and enjoy the passive income.
Now that you know the benefits, you may be eager to choose the best vacation rental property management company. But, you cannot just jump into this process hastily.
While searching for the right company, pay close attention to several things. Considering those facts will help ensure you’re partnering with the right one.
The property management company you choose should have expertise in your local and other areas. The company should have enough experience in handling the specific type of booking you get.
Remember that experience and reputation will play a key role. They will become the deciding factor when looking for a vacation rental management company. Thus, you need to contact a company with a proven track record.
The market is saturated with various rental property management companies. They vary in terms of their services and pricing, which is important to consider.
Make sure you determine what services you want from the property management company. Moreover, you also need to ensure they can fulfill your needs. Do you want 24/7 customer service and rent collection services? Don’t forget to let them know beforehand.
You also need to see if the company communicates with you properly. We have seen many property owners facing problems with their chosen company due to improper communication. So, make sure the company has dedicated communication channels and customer support.
Just because you’re hiring a property management company doesn’t mean you spend vaguely. Of course, they will help you save money in the long run. But it’s possible to find better deals.
Before you sign the contract, look for other options. Do some competitive research and know if they are providing you with a fair deal. Also, look beyond the initial cost.
Additionally, make sure the company has a transparent pricing structure. If not, document everything legally. This way, you can prevent the surprise of hidden costs.
A successful vacation rental property consists of many things. While there are others, vacation rental property management is undoubtedly one of the most important. With the right company and strategy, you can ensure your property stays occupied most of the time.
However, finding the right property management company takes time and effort. Even if you know the tips and factors, sometimes you can still fail to find the perfect company. This is where Sofia comes into the picture.
Sofia comes with various property management services that can cater to your needs. With a successful record in property management, Sofia can automate various tasks such as customer support, maintenance coordination, document management, and many more.
Sofia will ensure high property value and smooth operation. This way, you can generate higher revenue from your vacation rental property.
We believe you found this article informative. Are you looking for a professional vacation property management company? Hire Sofia today and watch the professional grow your business.