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VACATION REN TAL
OW N ERSHIP 2019
PREVIEW COPY
NOT FOR
REDISTRIBUTION
HOW TO B E RE N T A L RE A DY IN 30 S IM P L E ST E P S
This eBook is licensed for your personal enjoyment only. This eBook may not be re-sold or given away to other people. If you would like to share this eBook with another person, please click https://vacationrentalstrategist.com/shop/ to purchase a gift card. The recipient will receive your electronic card and notification about how to download the eBook. If you’re reading this eBook and did not purchase it, nor receive a gift card, kindly purchase your own copy. Thank you for respecting the hard work of this author.
table of CONTENTS Chapter 1 EVERY SO OFTEN ONE EVENT CHANGES THE WORLD . . 4 Chapter 16 ONLINE TRUST . . . . . . . . . . . . . . . . . . . . . . . . 48 Chapter 2 SMART START . . . . . . . . . . . . . . . . . . . . . . . . . 6 Chapter 17 SECURITY . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 Chapter 3 GUEST EXPERIENCE . . . . . . . . . . . . . . . . . . . . . . 8 Chapter 18 COMMUNICATION . . . . . . . . . . . . . . . . . . . . . . 53 Chapter 4 ACCELERATED RETURN ON INVESTMENT . . . . . . . . .11 Chapter 19 REVIEWS . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 Chapter 5 GOOD NEIGHBOR POLICY . . . . . . . . . . . . . . . . . 14 Chapter 20 PERSONAL TOUCHES AND GIFTS . . . . . . . . . . . . . .61 Chapter 6 MANAGING THE PROPERTY . . . . . . . . . . . . . . . . 16 Chapter 21 CLEANING . . . . . . . . . . . . . . . . . . . . . . . . . . 63 Chapter 7 INTERIOR DESIGN . . . . . . . . . . . . . . . . . . . . . . 20 Chapter 22 SOFTWARE . . . . . . . . . . . . . . . . . . . . . . . . . 66 Chapter 8 SUPPLIES AND FURNISHINGS . . . . . . . . . . . . . . . 23 Chapter 23 REMOTE MANAGEMENT AND MAINTANENCE . . . . . . 73 Chapter 9 BRANDING . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Chapter 24 CONSIDER A NICHE . . . . . . . . . . . . . . . . . . . . . 76 Chapter 10 PROPERTY DESCRIPTION . . . . . . . . . . . . . . . . . . 27 Chapter 25 WHAT HAPPENS NEXT? . . . . . . . . . . . . . . . . . . . 78 Chapter 11 PHOTOGRAPHY . . . . . . . . . . . . . . . . . . . . . . . 29 Appendix A A 30 STEP VACATION RENTAL READY CHECKLIST . . . . 82 Chapter 12 ONLINE TRAVEL AGENCIES (OTA) . . . . . . . . . . . . . 34 Appendix B SUPPLY AND INVENTORY LIST . . . . . . . . . . . . . . . 83 Chapter 13 SETTING RATES AND FEES . . . . . . . . . . . . . . . . . 39 Appendix C PROPERTY MAINTENANCE INSPECTION . . . . . . . . . 85 Chapter 14 RENTAL RULES . . . . . . . . . . . . . . . . . . . . . . . . 42 Appendix D FURTHER RESOURCES . . . . . . . . . . . . . . . . . . . 86 Chapter 15 LOW SEASON . . . . . . . . . . . . . . . . . . . . . . . . 46 About the Author . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88 3
chapter one
EVERY SO OFTEN ONE EVENT
CHANGES THE WORLD
Brian Chesky and Joe Gebbia moved from New York to San Francisco in late The shift began. Technology now provided a new vehicle for hosts to connect
2007. Jobless, they struggled to pay rent and their mounting credit card debt. directly, cheaply, and effectively with travelers. Hotels could never compete
with warm, personalized owner hospitality. Brian and Joe changed the name
One day they noticed all the hotel rooms were sold out due to a big Industrial
to Airbnb. They expanded to add more hosts and worked hard to make
Design Conference. They bought a few boxes of cereal, some air mattresses
them feel comfortable and supported with this radical new idea. Although
and flung open their door to strangers by way of their new online website
not yet mainstream, other companies could see where this was going and
called “airbedandbreakfast.”
jumped on the bandwagon to adopt the Airbnb model.
Three guests booked an “airbed” for the upcoming conference. Amol Surve
Eventually, the phenomenon amplified, sending shock waves throughout
was one of them. Years later, Amol recalls that the lack of a proper bed or
the tourism industry. Why was this change so disruptive? Because of
breakfast didn’t matter so much. What was memorable, however, was Joe’s
increasing consumer demand for this new choice in accommodation. By
warm welcome and his insider tour of San Francisco.
2016, Goldman Sachs noted in a survey that almost half of all first time
Airbnb guests did not go back to hotels.
4
Why do travelers choose a Why do hosts open their doors
vacation rental over a hotel? to strangers?
Travelers enjoy: Hosts enjoy:
• more space • the opportunity to offer hospitality and meet travelers from all
• greater convenience corners of the globe
• an experience that is often more comfortable, especially for families • creating a welcoming space and anticipating guests needs
• bringing along a pet, when permitted • showcasing their location and offering tips on the best experiences
• meeting hosts • the chance to earn extra income!
• exploring the area like a local
The explosive rate of growth resulted in some definite growing pains, and
• saving money!
there were big holes and inefficiencies. Over the last decade, host support
services have skyrocketed to fill the gaps. Many offer innovative and brilliant
solutions to address host challenges. No one saw this new career path or
business opportunity coming. Almost every industry leader describes their
entry into Vacation Rentals as “accidental,” in the footsteps of Brian and Joe.
5
chapter two FACTORS TO CONSIDER
BEFORE LAUNCHING A VACATION
SMART START RENTAL
Location: If purchasing specifically for a vacation rental, choose the location
Build a wildly profitable vacation carefully. It is the hardest thing to change.
rental on a rock-solid platform. Data and Analytics; Leverage Sophisticated Technology
AirDNA mines information in real time and generates reports to support
Poor decisions at this stage can be costly, frustrating, time-consuming, solid decision-making. Vacation Rental information is available from over
and occasionally even impossible to fix. 80,000 cities worldwide. Enter any address and view anticipated occupancy
rates and annual returns based on similar vacation rentals in the area. Gain
valuable insight by:
• “test-driving” a rental to confirm viability before investing
• measuring existing rental performance against peers
• studying future demands to set prices.
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Rates: Accurate estimations of potential revenue involves some research. Initial Costs: A landlord “this-will-do” attitude is a huge mistake. A fumbled
The goal is to achieve the highest return with the lowest vacancy. See related vacation rental launch into the “hospitality orbit” will be one rough ride. Build
Chapter 13 SETTING RATES AND FEES. necessary startup costs into the business plan. Prepare to weather the first
year until you build positive reviews, gain booking momentum and can consider
Stakeholders: Clarify who is involved in the business and how decisions
increasing rates. See Appendix A VACATION RENTAL READY CHECKLIST.
are made. Do you have a silent investment partner? For family cottages or
spare rooms, is the whole family onboard? Seek consensus, define Roles Design and Decor: Mismatched towels faded floral linens and the bumpy
and Responsibilities. pull-out couch will not WOW paying guests. Don’t trust past feedback from
friends who have crashed for the weekend. They generally give fabulous
Regulations, Laws, and Bylaws: Owners can be unaware of regulatory
reviews. Invest in good design. See related Chapter 7 INTERIOR DESIGN
issues. Find out if there are existing laws or bylaws addressing short term
rentals within your city, municipality, county or Home Owner Association Who will Manage Operations? See related Chapter 6 MANAGING THE
(HOA)? The industry is moving faster than scrambling regulators can keep up. PROPERTY
• no rules yet, an unknown risk factor. Get out in front of this issue, Identity: Who are you? How will you stand out against the growing
learn about Short Term Rental (STR) advocacy and get involved in competition? See related Chapter 9 BRANDING.
lobbying efforts. Good suggestions for reasonable bylaws are often
A VR Business has Value: Identify what adds value for potential investors
welcome.
beyond the real property assets. Capture this information from Day One
• STR allowed, what are the restrictions?
regardless of whether the plan is a short or long term investment e.g. guest
• STR prohibited HOT TIP: This can quickly fall into the “no fun at all”
names, real emails, phone numbers and reviews. See related Chapter 22
category. Neighbors can be cranky; fines can be expensive.
Software
7
appendix A
A 30 STEP VACATION RENTAL READY
CHECKLIST
10. Add exciting design elements 20. Establish a hospitality cleaning
1. Estimate the occupancy rate and
returns to determine the viability of that will meet guest satisfaction/ checklist with staging photos, hire
Vacation Rental (VR) in your market. comfort and inject some style housekeeping staff if applicable.
to stand out from the crowd of 21. Establish maintenance list,
2. Identify stakeholders; confirm property listings.
goals, roles, and responsibilities. schedule or perform routine
11. Purchase required inventory. maintenance.
3. Review local regulatory position
on VR and the proposed or estab- 12. Write a property description. 22. Select Online Travel Agencies.
lished applicable rules. Consider the cost/benefit of hiring 23. List property on OTA and use your
a professional writer. “info@” email for all correspondence.
4. Decide who will manage the VR.
13. Sparkle shine and stage for 24. Connect all calendars by ical links.
5. Create a budget that includes photography. Consider the cost/
realistic start-up costs. 25. Purchase a supply of thank you
benefit of hiring a professional
6. Meet the neighbors. Discuss your photographer. gifts.
VR plan, provide reassurance and 26. Choose a Property Management
14. Set rates manually or by a dynamic
your contact information. pricing tool. Software System.
7. Confirm your home insurance 27. Consider additional software
15. Draw up a Rental Rule Agreement.
covers VR use. integration to meet operational
16. Compose a set of standardized needs.
8. Develop a brand concept and communication for each guest
identify a target market 28. Schedule a review of metrics on a
touch point.
9. Choose a name for your property, regular basis.
17. Compile and create a guidebook.
purchase the corresponding 29. Build a website that can accept
domain and email. Example info@” 18. Write a bio, select a pleasant photo direct payments.
your property name”.com that clearly shows your face.
30. Create a marketing plan, use social
19. Define the guest arrive process, media.
how do they get, by a greeter, lock
box or keyless entry?
81
about the author
Susanne Young is a Vacation Rental Strategist, even became possible when she and her husband
photographer, and author of the eBook Vacation were out of town. Susanne suspected this viable
Rental Ownership 2019. business component would boost the value and
expand opportunities to attract out-of-town
She purchased a condo and launched a vacation
purchasers. A quick sale for a premium price
rental with the primary goal to create an enhanced
despite a cooling market confirmed her theory.
guest experience. The business quickly outper-
formed the competition in the first year. In a Susanne believes that none of the above was
seasonal rental market, a new bar was set with 90% random good luck. “When all aspects of a vacation
year-round occupancy, glowing five-star reviews, rental are optimized, success can be predicted
no damage reports nor neighbor complaints. with near mathematical certainty.”
She discovered that concepts from a former She lives in the vacation mecca of the Okanagan
career in health care leadership such as with Dennis, her skiing, golfing, sailing partner
efficiency, automated operations, and continuous and husband of 31 years. Time spent with family,
improvement, were transferable to vacation rentals. close friends, and especially her granddaughters
Remote management with confidence and ease fill her with gratitude.
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