A recent stay in a short-term rental located in St. George, Utah brings thought to the best vacation rental practices. With consideration to the industry, trends, and renter’s needs, this is a collection of the top five tips to vacation rental ownership.
Know the industry. Although a large part of rental ownership involves real estate management, a successful rental relies on hospitality, first and foremost. There are many buyers hoping toenter the field for the foreseeable cash flow and profit, however this approach does not apply the most renowned business rule: the customer comes first. Rental ownership requires that a service be provided for renters to experience. Seemingly simple, but it can be forgotten in the big picture and when done correctly, will result in satisfied customers who will return and spread the word.
While there is cashflow in this business, that all depends on how the buyer responds to afluctuating market. The difference between excelling and failing is prioritizing the renter’s experience. Much like other industries, customer satisfaction keeps vacation rental properties relevant. Including competitive amenities, thoughtful details, and friendly customer service is just as important as the technical aspect of property management and will elevate guests’ experiences, naturally increasing interest and customer retention.
Location. Location. Location. When purchasing a vacation rental, the location is going to determine factors like how likely and how often renters will want to book the property; both play a critical role in cash flow projection. Choose an area where people will want to vacation,preferably a place with multiple amenities. Areas in Southern Utah are frequented continuously throughout the year due to their favorable weather and varying seasonal attractions. This is something to consider when calculating a financial analysis and whether the results will be comparable with financial expectations and the needs of the property. nests in an ideal location for the sights and local experiences.
It is helpful to identify if there are less popular locations and less popular seasons. Calculate the number of rentals and bookings required per year to identify the presence of peak times and off times. There will be a noticeable increase in bookings during busier times to base your cash flow and analysis on, and less bookings during times that are not so busy.
It is the little things. Lightly touched on in tip #1, but to reiterate its importance, the customer comes first. When purchasing a vacation rental, the vision must reflect consumer desires and expectations. This should affect decisions in every aspect of the bigger picture from the location to those tiny interior details like choosing between Cotton or Egyptian Cotton bath towels. Imagine the person who will use those bath towels to dry off after a long day and rest in those linen sheets hand-selected just for them.
Think ahead about what renters may need during their stay so that they do not have to worry about it. For example, a stay near the beach, must have a cooler for transporting refreshments to spend a day at the ocean. Not providing this basic beach necessity causes more of a hassle for customers. Some may take a flight to their Airbnb, limiting what items eager vacationers can bring for their stay. If this home were near a lake, then the home should have kayaks and life jackets. If the home were near a mountain, then a couple of mountain bikes would be a useful touch. Also look at the items often used in a home, like a spatula, can opener, wine glasses, and provide these so that no one must make a last-minute trip to the store. It is also important to note that purchasing insurance coverage in case of damage or injury to the bigger items is recommended.
Fully preparing the home will set customers up for a care-free trip and will leave them feeling well taken care of, which will be reflected in their reviews. When aligning with the consumer, a successfully curated vacation home is created, and it becomes worth renting.
Quality over Quantity. Foolproof the property from accidents and regular wear and tear by using quality products. Whether purchasing a new showerhead, mixer valve, or a toilet, the quality of these items will not only go a long way with the renter but will hold up over time.
During a recent stay, there were a few things that went awry, starting with the dishwasher that did not work. A couple of nights into the stay, the sink disposal started leaking and water covered the kitchen floor. Then the sink backed up which required outside assistance and really put a damper on this vacation. Let this be a lesson learned: choosing quality is a sustainable choice that will save money overall, and renters will appreciate it.
Hire the right property management. There are two options for successfully operating a vacation rental: solo or using a property management company. Running a vacation rental solo is possible and can be done well if the location is a neighboring home nearby.
If the rental property is not within a reasonable distance, it is vital that a property management company take over to handle the day-to-day details. This is important to maintain excellent care and quality of the cleanliness and lay out the finishing touches before check-in. The right management company will still prioritize their role in creating a hospitable environment for guests. They will be the only people that potential clients may see or hear from when needing direct and swift assistance. When done efficiently, small discrepancies can be avoided and resolved quickly. During the recent trip, the trash was full and surrounded by flies. The pungent scent lingered. Due to a lack of quality property management, the premium vacation rental was unaware that the previous tenants had not taken the trash bags in, or the trash bags may not have been provided previously.
The small stuff does matter, and any good property management company should understandthat. With years of industry knowledge as a real estate investor, purchasing a vacation rental will be incredibly challenging and hopefully the decision has been taken seriously, as it is not recommended. Remember these five tips: a deep understanding of the industry and the importance of hospitality, choosing an attractive location, not skipping on the little things, using quality over quantity, and hiring a good property management company. This knowledge can help make educated decisions from the most minute details to the bigger picture vision, creating a smooth buying and renting experience.
Happy Home Buying,
Sunny Vacation Rentals