14 Tips to Maximize Your Vacation Rental
If you’re new to renting out your vacation home then you’re one of the many homeowners aiming to take advantage of the growing global short-term rental market, which is currently worth an astounding $100 billion and projected to hit $170 billion by the end of 2019. With the rise of AirBnB, HomeAway, VRBO, Booking.com, TripAdvisor and other online platforms, homeowners are increasingly seeing the benefits of vacation rentals as a way to earn extra income. A matter of fact, there more than 660,000 U.S. vacation homes currently listed on AirBnB alone and guests are continuing to move away from hotels and into vacation rentals, with one Goldman Sachs study showing that people who stayed in a vacation rental in the five years are now half as likely to prefer a traditional hotel in the future. Furthermore, in 2012, global room sales in short-term rentals amounted to $45.6 billion and by 2022, those sales are projected to rise to $132.5 billion globally, according to Euromonitor International.
This dramatic growth however, brings many challenges to the short-term rental owners. More vacation rentals leads to increased supply, increased competition and a much lower tolerance for mediocre guest experiences. Guests now expect hotel-like quality with the uniqueness, exclusivity and charm of a short-term vacation rental.
So how can you maximize the potential of your vacation home? Here are 14 tips guaranteed to help your vacation rental succeed:
List your property on the right online platforms – With so many online platforms to choose from, it can be overwhelming. You certainly want to list your property on more than just one platform to maximize your listing’s exposure, but the right platforms depend on the market in which you’re located in. Managing more than one online platform can be time consuming. The most popular online travel platforms are AirBnB, VRBO/HomeAway and Booking.com. If your property tends to attract families or groups looking for vacation stays than VRBO is a must. AirBnB on the other hand, is the largest and fastest growing online travel platform and tends to attract travelers looking for short-term stays, last-minute bookings, and city accommodations. Be sure to also research Booking.com, TripAdvisor and others to see if it makes sense to list your property on those sites as well.
Use Professional photos – First impressions matter. Listings with professional photos earn 40% more on average, get 24% more bookings and earn 26% more on their nightly rate. Spend the $100-$200 on a professional photographer because high quality photos are a must if you want your listing to stand out from the competition. Be sure to have at least 30 photos of your listing, set the order of the photos so it tells an appealing story and showcase your property’s unique characteristics and amenities. Be sure to include photos of the inside and outside of your property and use drone shots of the location of your property if the location is an appealing factor for travelers. If you really want to go the extra mile, which I suggest you do, then include photos of what makes your neighborhood fun and unique (shops, dining, cafes, the ocean etc.).
Create an appealing & accurate description – It’s important that your listing’s description is both appealing and accurate. Include the obvious details like number of bedrooms, number of beds, how many people your listing accommodates, number of bathrooms, square footage, whether or not there is multiple levels etc. But also be sure to promote what makes your property unique – is it the location, special amenities like a hot tub, pool, or large yard? In addition to an appealing description, it’s essential that it’s accurate because you never want guests to arrive at an accommodation that does not meet their expectations. When in doubt, under promise and over deliver ;)
Focus on the guest experience – One of the many reasons short-term rentals are taking market share away from tradition hotels is due to the unique experiences that they offer. Homeowners who rent out their vacation rentals used to be able to get away with simply providing a clean property. Nowadays, it’s much more than that. Not only do guests expect pristine properties, but more and more expect hotel-like amenities like towels, linens, wash cloths, soaps, paper towels, toilet paper and more. The properties that excel in the short-term rental market maniacally focus on the guest experience. They offer all the expected amenities in addition to providing welcome books with details on their home and neighborhood. They provide car services, bikes, kayaks, beach chairs, a thoughtful welcome gift and more. Top-class guest experiences translate to 5-star reviews which equates to more bookings, repeat guests and more income. Always keep the guest top of mind.
Don’t try to appeal to everyone – One of the most successful marketers, Seth Godin, believes that the way to win is to compete in the smallest possible niche. This certainly holds true for short-term rentals. If you try to appeal to every type of traveler, not only will you be unable to satisfy them all, but you’ll never be among the best accommodations options. If you focus on a specific type of guest however – families, couples, business travelers, surfers, yogis, gamers, sports fans, whatever it may be – you have an increased chance of becoming the best accommodation option for them. Overtime you’ll gain a reputation of the accommodation best known for “XX” type of traveler.
Dynamic pricing – When you first list and promote your vacation rental you’re tasked with choosing a price per day, price per week or price per month. This may seem simple at first as many homeowners simply research comparable rentals in their area and decide on a price that seems fair and competitive before setting their price. The truth is, those who keep their rental rates stagnant will be overtaken by the competition. Price optimization takes ongoing oversight, market knowledge and consistency. So what does this mean exactly? First of all, it’s ideal to price and promote your property at least 12 months in advance. The more time you allow potential guests to view and book your property the better. Secondly, be sure to price your property differently depending on your market’s high-season, mid-season and low-season. Those who maximize occupancy in the mid-season and low-season often outperform their competition vastly. Be aware of big events in your market (eg. Festivals, concerts, shows, holidays etc.) as these events often create more demand for rentals. Lastly, never keep your prices stagnant. As vacant days/weeks/months approach it’s important to change your prices in order to maximize occupancy. A week rented at $2,000 is better than a vacant week priced at $2,5000. In addition to consistently optimizing your pricing, be sure to optimize your “minimum stay”. If you’re minimum stay is 7 nights, but you have several weeks approaching that remain vacant, then it may be wise to reduce your 7-night stay to a 2-night stay, while simultaneously revising the nightly rate, in an effort to increase your number of bookings.
Communication – Timely communication to all inquiries is massively important when it comes to a successful rental operation. The sooner you’re able to respond to inquiries the higher the chance that inquiry will result in a booking. Waiting 24+ hours to respond to inquiries will not only decrease your chances of attaining a booking but it may also hurt your property’s ranking on sites like AirBnB and VRBO. Also be sure respond in a timely manner to any guest communications. Guests expect hotel-like service and if they have a question or need while staying at your property they expect to get a response ASAP. This will heighten their experience which may led to better reviews which then may lead to repeat bookings year after year.
Maximize occupancy during mid-season and low-season – during peak season its easer to attain bookings (duh). Owners who maximize occupancy during mid-and-low seasons are the ones who outperform their competition when it comes to annual revenue. How are you attaining tenants during your mid-and-low seasons? Are you tweaking the price? Are you altering your minimum stay requirements? Are you modifying your listing’s title and description to remain timely and to take advantage of the appeal to staying in your property during off-peak seasons? Are you working with a real estate agent to attain a 4-6 month tenant while you wait for the next peak-season?
Regularly update your listings – It’s important to keep your listing updated. Especially when you add upgrades, amenities, furniture etc. Not only update the description but also update your photos. Listings that are updated on a regular basis often rank higher on sites like AirBnB and VRBO.
Keep calendars up to date – Nothing is more detrimental to your listing’s ranking than having to cancel someone who’s booked your property. This is why it’s essential to keep your calendars up to date with prices and properly blocked off days. If you’re listed on more than one online website (which you should be!) then be sure your calendars are synced. That way, for example, when someone books a week at your property on VRBO it automatically blocks this week off in your AirBnB listing.
Hire the right resources – One of the most important factors in a smooth rental operation is having the right people in place. The key players are your cleaner(s), maintenance men and woman, electricians and plumbers. Take the time to interview these people, get references and ensure they are reliable and their work is solid.
Attain 5-star reviews and respond to all – One of the biggest contributors to your online ranking is guest reviews. It is of paramount importance that you attain 5-star reviews after every check out. Many guests won’t leave a review at all so be sure to send a friendly reminder after every stay asking them if they would be willing to leave you a 5-star review. On the contrary bad reviews can dramatically hurt your listings ranking.
Maximize occupancy – More beds = more heads and more heads = more income. The more people your rental can accommodate comfortably the more you can charge. If possible, be sure to buy a comfortable queen size pullout sofa. This will allow your rental to accommodate an extra 2 people in beds. The difference in revenue potential between a rental that sleeps 4 people and a rental that sleeps 6 people is huge.
Hire a property manager who specializes in short term vacation rentals – As you can see, there are numerous time-consuming, yet necessary, factors that are needed to run a successful and profitable short-term vacation rental - skillful marketing, listing on the proper online channels, channel management, regularly optimizing rates, top-class guest experiences, repeat and loyal renters, timely communication, reliable cleaners and much more! Hiring an expert short-term vacation rental manager can help you earn more income, stress less & maximize the potential of your vacation home. The majority of vacation rentals leave thousands of dollars on the table every year. Seacoast Vacation Rentals provides full-service vacation rental management with no sign-up fee, contract commitments or cancellation fees. We own vacation rentals ourselves and understand how overwhelming and time-consuming managing a vacation rental can be. We know how important your home is which is why we treat every home under management as if it’s our own. We only make money when you make money which keeps us 100% motivated to maximize your rental income while keeping your property well maintained. Call us today if you’d like to learn more! (603) 560-5357