Do you own a vacation rental property? Maybe you’re considering getting your first one. Here are some tips for managing your vacation rental property. Many people hire property managers handle the day-to-day operations of their rentals. But others may be new to the idea and not sure if they should take on this responsibility themselves or hire a professional property management company. Many times, property management companies charge a sizable monthly fee. Here are some things to consider when deciding which route to go.
Rates vary widely from a co-hosting arrangement in the 10-15% of the nightly rate range upwards of 30% or more for full-service management. The more the owner participates in the process the less necessary a full service property manager is and the more of the nightly rate the owner should be entitled to.
Ideally a full service property manager should inspect the rental property for damage after each guest’s stay. There is a limited time available to withhold a portion of the damage deposit. However, we are finding that most management companies are overwhelmed with the number of properties they deal with and push down inspections to the cleaning companies. Given the fact that we are in the home after each guest stay it makes sense, but the homeowner should not have to pay the management company if they state they inspect homes if they don’t have the capacity to actually do it.
This usually begins with a Google search. The important thing is to understand the fee structure, what is promised, what is actually delivered, what the reviews are for both the company and from the guests in each local market, and who owns the property listing. Doing your own research can’t be stressed enough.
That depends on how involved the owner wishes to be. About 75%of our cleaning clients are able to manage the process directly and not pay a management fee at all. In this case the owner is the point person in communicating with guests before, during, and after stays.
Property managers can do some or all of the following:
Partnering with proven local companies who know the local market, keep the property booked at the highest nightly rate while keeping overall costs to a minimum.
There are two ways to make more money from your vacation rental property.
1. Increase revenue and/or
2. Decrease expenses
Increasing revenue is accomplished by working towards the goal of having your property rented out the greatest number of days at the highest rate the market will bear. In order to accomplish this pricing must be correct and your property must be the most attractive relatively to the other properties in the market. Online marketing, professional photography, and a high number of excellent reviews are some of the more important things that help a vacation property become more attractive. Decreasing expenses will help net more income as well. The largest expense most rental property owners have outside of their mortgage is the management fee charged by management companies. If an owner is willing to help out a little managing their property, they can cut this expense dramatically. Managing the property themselves or hiring a Cohost to help with some of the management tasks can dramatically decrease the overall expenses.
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