You have a home that is lying unused. This motivates you to set up your property as a vacation rental for those who are looking for an alternative to hotels and are taking a vacation with family in your region. As a prospective vacation rental owner, you are excited and nervous about crucial aspects that you can’t afford to ignore in terms of legality, operational and financial matters of your investment in the rental.
Let us briefly view each of them.
8 Important Tips to Run Vacation Rental Business Smoothly
1. Organize for home insurance
Arranging for a home insurance should be the first priority for a vacation rental owner. Talk with an insurance professional about an appropriate insurance that covers your vacation rental in terms of damages, fire, thefts, injuries and other unforeseen events that may occur before, during and after a guest’s stay.
2. Have your property inspected
Before you proceed to list your vacation rental or purchase one, it is always recommended by the industry experts to have your property inspected. A property inspection can discover pest infestations, potential fire hazards and technical issues that are often overlooked. It can assist you to make necessary renovation, minor changes and place safety precautions and tools at the short term rental.
3. Be prepared to pay taxes
It is advised to know about the local laws and rules related to a vacation rental. Do not proceed ahead if the local laws prohibit short term rentals. If your vacation rental is registered, you may have to pay the regulatory taxes. Your regular tax-compliant efforts can assist you to stay away from any legal trouble. Inquire with your financial expert about the taxes that you are required to pay as a vacation rental owner.
4. Be committed to your vacation rental
Prospective vacation rental owners should always be committed to their vacation rentals and customer service. Be ready to offer time, money and customer service skills for your vacation rental. Even if a professional management firm will manage your rental, keep a close watch on any changes, operations and how your guests are treated in the rental.
5. Evaluate your expected costs
Before diving into the vacation rental industry, one should analyze the total costs and expenses that will occur per annum or bi-yearly versus the expected income from the property. The expenses can include taxes, advertising costs, maintenance costs, vacancy loss costs, utilities, repairs, etc.
Calculate the expected income based on the local rental trends, the rental property size, class and amenities, expected guests per week/fortnight/month and special deals that you may offer.
If you choose to convert your property to a customized vacation rental, your costs may increase and it may take time to cover these costs. You may also have to bear the costs in case of zero bookings in the off-season.
6. Research Your Local Competitors
A vacation rental management will mean some financial investment from your end. Will the local competition in the area make it easy for you? Every rental owner is here to make profits and that can give birth to local competition in terms of guest luring, price war, deals and amenities offered.
You will have to make sure regularly that your rental is priced competitively and that you have not underpriced your home, resulting in lost income.
7. Arrange for extra help
A vacation rental owner may not be available always for an emergency call from a guest or during a check-in and check-out. It is recommended that you as a rental owner arrange for a professional small team who can look into the operational issues, emergencies and queries related to your rental in your absence from the guests. This saves time and effort of the home owner without any discomfort to the guests. Affordable and reliant team for your short term rental can be of great service to you and your future guests.
8. Keep an attractive description of your rental
Properties sell and rent based on how you portray them. A brief but effective description of your vacation rental can convince people to spend their vacation in your compatible property. Describe your home in terms of size, location, landmarks, price, amenities, etc. with several quality pictures that support your claim.
Be in the shoes of a traveler and imagine what questions a traveler might have when choosing a rental and place the answers in the description. Choose your words carefully and use specific and attractive keywords in the description.
If you are confident enough to survive in the market on a regular basis, welcome to the vacation rental industry.