Property owners who own multiple properties may be considering renting out their building to guests when they aren’t using the property. If you are exploring the benefits of managing your property yourself versus hiring a vacation rental property management company, you’ve come to the right place.
In this blog post, we understand the benefits of working with a professional vacation rental property management company. We also consider how you can select a partner whose professional expertise supports your long term property management goals. Let’s get started.
What’s wrong with managing your property yourself?
One of the first questions you may have as a vacation rental owner, is why you can’t just manage the property yourself. Well, the truth is, while owning a getaway vacation property is delightful, vacation rental property management is not so much.
Vacation rental property management is a lot more than just good housekeeping. When you have a vacation rental, you’ll need to don many hats, some of which include being a –
- Great host
- Property marketer
- Expert in building & vacation rental safety regulations.
- Rent collector
- Tenant manager
- Insurance provider
- Empathetic neighbor
- And a lot more.
You may not have the time or the resources at your disposal to be so actively involved in vacation rental property management yourself. Additionally, not being able to choose the right tenants or even attract a steady stream of renters to your property, can cause the expenses to rake up. Ultimately, your goal is to make sure your vacation rental is bringing in the bucks, when you’re not using it.
There’s also the need to take care of day-to-day maintenance, serious repairs and property upgrades. You may not have the expertise necessary to navigate the compliance requirements to keep your vacation rental in the right manner. Any rent collection and eviction related concerns will need to be managed by you alone – which can sometimes be really challenging.
It pays to have the support, expertise and services of a professional vacation rental property management company in these circumstances. The experts working there will be able to proactively manage your vacation rental in your absence and ensure your property gets all the care it needs to thrive.
Benefits of hiring a vacation rental property management company
Hiring a vacation rental property management company to care for your vacation rental has multiple benefits. Some of the advantages are –
- The vacation rental property management has specialist knowledge about managing vacation rentals. They will be able to advise you on how best to monetize on your property.
- They’ll be able to get your vacation property listed on multiple rental services websites and other platforms. You’ll be able to get more visibility through the vacation rental property management company, than on your own.
- They will know how to vet and qualify renters. The company can ensure only those people who fit your preferred renter profile get access to your property.
- They have the resources needed to manage all vacation rental payments and can ensure you receive your rent on time.
- They can find reputed housekeeping companies, repair services providers and property security managers that fit your needs and budgets.
- They have the expertise to handle evictions with sensitivity, without drawing negative attention to your property.
- They excel at neighbor relations and can make sure you don’t receive complaints from neighbors about your renters and rental property.
- They can make sure your vacation rental property is up to date with all building regulations and safety certifications.
- They can advise you about the vacation rental trends in your geography and help you grow your vacation rental earnings with the right investments, renovations and property upgrades.
How to choose and hire a vacation rental property management company for your property?
Now that you know why you need to choose a vacation rental property management company to take care of your property, let’s look at how you can select the right partner.
1. Consult other landlords/owners or join a real estate association
Start the process of vetting vacation rental property management companies by speaking to other landlords/owners. They may have recently chosen a vacation rental property management provider and will be able to advise you on hiring one for yourself.
If you don’t know any rental property owner or landlord, consider joining your local real estate association. Usually, such bodies work closely with other real estate service providers. They may be able to help you find a qualified vacation rental property management company.
2. Research and shortlist vacation rental property management companies by doing your research
Once you have a list of vacation rental property management companies you can contact, you need to do independent research to learn about them.
There are a few key things that you need to learn about when selecting your vacation rental property management company. When you wish to shortlist your chosen property management companies, ask them about the following:
Number of years of experience in vacation rental property management
The longer a vacation rental property management company has worked in the field, the more exposure they will have to diverse clients and rental scenarios. Plus, they will have a robust system that has processes and procedures to manage any challenges that your rental property may experience.
Even if your vacation rental property management company is relatively new on the market, check if the individual employees/owners have prior experience in the field. Sometimes, a new company started by a highly-experienced property manager can give you better support and individualized attention than a larger company with hundreds of clients.
Nature of their client portfolio
Another factor you need to consider is the type of clients a vacation rental property management company works with. This will help you understand if the shortlisted company has experience managing a rental property like yours.
- Does the company handle independent properties or apartment complexes?
- Do they have experience managing short term rentals or can they handle long term vacation rental properties as well?
- How many clients do they have?
- What renter profile do they normally work with?
- What is the revenue they generate on properties that are located in the same geography as yours?
All of these questions can help you better-understand whether your needs fit the vacation rental property management company’s specialization.
Services they offer
Another very important factor you need to consider before hiring a vacation rental property management company, is the type of services they offer. The common services that most vacation rental property management companies provide are –
- Pre-rental and post-rental property inspections.
- Writing the listing and putting it up on various listing websites/platforms.
- Updating the rental property listing whenever you make any changes to the property or rent.
- Property photography and drone videography.
- Real estate marketing and vacation rental promotion across online and offline channels.
- Vetting of rental applications, interviews and documentation verification.
- Pre-rental property walkthroughs for guests.
- Guest welcome and check-in management.
- Rent setting, expense management and profit planning.
- Rent collection and payment management.
- Property security.
- In-person visits to help/support guest needs.
- Hiring and managing third-party service providers (such as gardeners, repair services providers, security agencies, chefs, chauffeurs etc.)
- Property cleaning, maintenance and repairs (daily, weekly, monthly, quarterly, half yearly or annually).
- Eviction handling (when necessary).
- Neighbor relations.
- Rental property market trends analysis for real estate advisory.
- Post-rental clean-up.
- Property compliance check-ups and regulatory fulfillment.
While some vacation rental property management companies offer all of these services, others may offer only some. It’s important to check what exclusions are there, so you can decide if you’re okay working with a company that offers only select services. For example, not all companies offer out-of-office-hours property visits as part of the guest support service. Knowing this will help you decide whether you need to hire multiple vacation rental property management providers to take care of different aspects of your company.
Contract terms and fees of vacation rental property management services
Another factor to consider is the terms of the contract and the fees the vacation rental property management company will charge you for its services.
First off, check if the company has a specific lock-in period (it’s usually 1 year). There should also be information about a contract termination period with details about penalties for late termination.
Next to check is the return versus fee charges. Some companies claim to offer really high returns for a very low vacation rental property management fee. But this may be too good to be true, since usually, such low fees indicate a smaller selection of services. You may need to pay a premium to avail of other services – and this can rake up your expenses tremendously in the long run.
Another contract term to verify is hidden fees and charges. For example, do your fees include payment for property listings on all the promised channels and platforms? Will you need to pay a premium for certain maintenance or guest services?
Associated with this is the assurance by the company to get your vacation rental a certain number of bookings. It doesn’t make sense if you end up paying more in terms of additional fees/charges when the vacation rental property management company offers to get you bookings only for certain months. Your property may incur more expenses for remaining empty for extended periods of time.
Finally, you also need to check whether the contract terms and fees offered are the same or different for the peak holiday season and other seasons. Some companies tend to have differentiated terms and fees for peak tourist season and off-season times. It helps to know what you may be agreeing to and gives you the opportunity to negotiate a more personalized deal for your vacation rental property management needs.
Availability of business insurance
This is a really important aspect that you need to check before hiring a vacation rental property management company. Your property manager may hire employees from their own company or even third party service providers for property upkeep. As with anything, there are chances for on-site injuries, property damage and other problems. Your vacation rental property management provider needs to have adequate business insurance to cover any losses or expenses that arise out of on-site work. Typically, your vacation rental property management company needs to have –
- General liability insurance
- Professional liability insurance
- Business personal property insurance
- Workers’ compensation insurance
- Cyber liability insurance
Additionally, you need to find out from your vacation rental property management company if you need to purchase Property Insurance or if they will do it for you.
Marketing knowledge
Vacation rental marketing is integral to ensure your property receives a steady supply of renters. This is why you need to find out if your chosen vacation rental property management company has the knowledge and experience to run promotional campaigns to market your listing.
You need to find out what platforms they promote on, what their typical promotional budget is and what analytics tools they use to check the effectiveness of their campaigns.
Property updates reporting system
Vacation rental property management companies do provide reports to the owner about their property’s rental performance. You need to check what type of updates your shortlisted company offers. Plus, how frequently they update you about your property.
Some companies only share a monthly, quarterly, half yearly or annual performance report. Others share detailed information about each renter, any concerns they faced and their feedback. It’s important to work with a vacation rental property management company that gives you the information you want to know.
Additional vacation rental property management advisory services
Continuing from the previous point, some vacation rental property management companies also track market trends in your locality. They will be able to tell you about –
- Any property renovations, refurbishments and upgrades that can help you earn better.
- Investments to make nearby to grow your real estate portfolio.
- Changing renter profile in the region, so you can change your services offered and marketing message.
- Best ways to minimize your expenses and maximize your revenue generation with increased competition.
Once you have all of the information we have listed above, you will be in a good position to shortlist 2-3 vacation rental property management providers for final evaluation.
3. Discuss your long term plans about the property
It’s important to discuss your long term goals about your rental property with the shortlisted companies. This will help you know if they are in a good position to support your needs or not.
Take the property manager on a property tour. Discuss your potential plans for the property. Share your investment budget for any marketing, maintenance and other expenses that the company expects you to bear. Let them know about your expected returns and find out how they can help you.
4. Choose a vacation rental property management company who fits your needs the best.
Typically, you will receive a contract offer from the rental property manager after all discussions are complete. You can negotiate the terms of this contract until both you and the vacation rental property management company are happy with the listed terms and fees.
Work With Haustay Today!
Once you find a company whose contract matches your budget, needs and long term goals, you can lock in the contract and get started. The vacation rental property management company will take over for you and will ensure your property gets a steady stream of renters. At Haustay, we are a reputed vacation rental property management company with years of experience helping property owners maximize the value of their properties. We are based in Carlsbad, California and specialize in beach side rentals. With our help, you’ll be able to make your vacation rental property profitable in no time. Contact us today to discuss your needs.
