5 Questions to Ask To Choose a Vacation Rental Management Company
Finding the Right Property Manager Isn't Easy
The last few years have seen a surge in the number of short-term rentals available–by AirBnB’s latest estimate, there are over 6 million listings from around the world on the platform, and that number is growing every day. The short-term rental market saw a huge shift post-pandemic, with demand, occupancy, and revenues soaring for owners, and more and more investors are looking to get a piece of the market.
But starting a vacation rental business, especially on your own, can be an onerous and overwhelming task without the right management company behind you to support you and your real estate investment. If you’re thinking about hiring a property manager for your short-term rental, there are a few questions that you should ask yourself first.
#1: What Are Your Property Management Needs?
The first and most important question you should ask yourself before choosing a property management company is: what services do you need? Owners who are not local and want to have only minimal oversight into their properties will need a different service than those who are local, hands-on and want to manage every aspect themselves.
While you’re doing your research into property managers, decide on the basic services that you want covered and narrow your results down from there. A full-service management company might be appropriate for you, but for someone else, they may end up paying extra for services that they don’t need if they go that route.
#2: What Are My Goals and Expectations?
Another important question to take stock of is, what are my goals and expectations for my property and its performance under a property management company? There are a few layers to this question, including what type of revenue you’re hoping to make, how often you expect to be informed of the goings-on of your property, how often cleaning and maintenance services will take place, etc.
To answer this question, jot down two lists, one titled “Goals”, and the other “Expectations”. Under “Goals”, list both your revenue and relationship goals with your prospective property manager. Under “Expectations”, write down the minimum services you’re hoping for. Laying out your hopes for your property management company in this way will allow you to firmly understand what you’re looking for as well as give you a way to measure if your service is performing adequately in the future.
#3: Which Fee and Commission Structure Are You Looking For?
The next vital consideration that you should think about is what type of fee and commission structure would work best for you. There are typically two different types of fee structures you will see in the short-term rental world: commission-based or a fixed-rate.
With a commission-based model, owners pay a percentage of each guest booking to their property management company. A fixed-rate fee, on the other hand, means that owners will have to pay one flat rate for the management of their rental. Depending upon your goals for booking and occupancy, it’s important to figure out which of these types of fee models will work best for you.
If you’re hoping to stay fully-booked every night, for instance, working with a commission-based company would be more beneficial to your goals, as they have the commission incentive to keep your rental as booked up as possible.
#4: How Do You Want to Handle Guest Communication?
Guest communication is one of the most essential concerns for short-term rental owners, and everyone prefers for it to be handled in different ways. Do you like to give your guests that personal touch and reply to all communications yourself, or would you prefer to have your property management company take care of that part of the guest experience?
To find a property manager for your short-term rental that’ll fit you like a glove, research how your prospective companies deal with guest communications. While some owners might prefer to personally connect with their guests, providing faster communication is important, and a property manager with the right resources will be able to respond quickly, especially during emergencies or when you may be unavailable.
#5: What Will Happen with Maintenance and Repairs?
One of the most essential parts of property management is ensuring that the property itself is in great condition, so for your last consideration, take into account how you’d like maintenance and repairs to be handled. Are you handy and want to make sure it is all taken care of yourself, or would you rather allow everything to be hired out through your property manager?
Owners who want to ensure the care of their property themselves, for instance, will probably want to go with a different property management service than owners who only rarely set foot in the rental and need everything by local contractors and providers hired by their management company.
Select a Vacation Rental Property Manager With Expert Service
Choosing the right property management company for your vacation rental is no simple task–it’s something that should be done after careful deliberation and consideration has been made into the topics we went into above. With these five questions in mind, you’ll be able to more easily nail down what you’re looking for in a property manager, and choose with a bit more comfort. Outside of the above questions, it's also imperative that you select a company that operates in the region of your vacation rental. Fortunately, LocalVR operates property management services in Telluride, Breckenridge, Lake Tahoe and Park City.
When you go with a full-service property management company like LocalVR, your hopes and expectations will be taken into full account by our expert teams. And best of all, you won’t have to lift a finger to ensure that your property is kept in great condition and that the bookings are rolling in–we take care of everything for you. And for more tips and tricks on becoming a top-rated short term rental owner, check out our blog.