By Alfred and Emily Glossbrenner
RISMEDIA, Nov. 10, 2008-You remember the news stories: People buying condos in Florida, Nevada, California, and other hot markets and “flipping” them for a fat profit before even a single spade of earth had been turned. Then everything went crazy, and hundreds of thousands of investors were stuck with new bricks-and-mortar properties that no one would buy.
Fortunately, for many, there’s a very palatable alternative: offering those properties as vacation rentals or “VRs.”
As hard as it is to believe, there may be a silver lining to the current turmoil. First, people will always take vacations. But now they’re more likely to stay on U.S. soil. Second, with their full kitchens, washer/dryer laundry rooms, swimming pools, and other amenities, vacation rentals not only offer much more space than a hotel, they are much more economical. There’s no need to ever take the family out for an expensive restaurant meal, for example.
And there’s more good news. General awareness of the vacation-rental lodging option is growing. The leading Internet VR advertising sites were set up around 1995. Ten years later, in 2005, venture capitalists raised over $200 million to buy them all up. They established a company called HomeAway, and began a major campaign to promote public awareness of the vacation-rental option.
So, how can you catch this wave and ride it to pay your mortgage and expenses while you wait for the real estate market to come back, as it always does?
Here are five tips to get you started:
Study the competition. Two of the best places to do this are HomeAway (www.homeaway.com) and VRBO (www.vrbo.com). Look at listings for VRs in your area to get an idea of what they offer and how much they charge.
Take lots of great photos of your property. Note: No people in the pix, please! Make it easy for your prospective renters to visualize themselves in the scene. And be sure to “dress the set” the way professional photographers do, with an arrangement of colorful flowers on the coffee table, or a dining table set up for a family dinner.
List your property on the leading VR advertising sites. For starters, we recommend HomeAway and VRBO, because they’re the most popular and get the most Web traffic. Total cost: less than $600 a year.
Run your VR like a business. Build a team of reliable cleaning and service people, collect and pay local and state sales tax, get set up to accept credit cards, maintain an online availability calendar, and always respond quickly to inquiries from prospective renters.
Remember: You’re in the hospitality business. Think of yourself as a host and your prospective renters as guests. With this mindset, you’re sure to be successful as a vacation-rental owner.
4 comments:
Wow you make it sound so easy in your five tips. It is one thing to add your VR to one of the VR sites, but if a property owner really wants to do business and to be part of a professional business, I would offer tip #6: Check out a Property Management Company. While a professional management company may take some of the profits, the revenues will still be coming in and the property owner will have a peace of mind knowing that their investment is well cared for as well as advertised beyond what an individual is able to do. Do you really think that a cleaning person will hop out of bed at 1 am when a guest cannot find the key or the guest has a broken toilet? As a guest, I rather do business with a professional company, who is licensed, well staffed, has high cleaning standards and can work well with the public. There is far more issues than just listing your own property on a VR site and hoping the guest will flock to your property.
another tip: create a personal website for your vacation rental with an own domain. this will make it much easier to tell new and existing customers about how to find you on the web. it's easier to remember e.g. www.myvacationrental.com than www.homeaway.com/34353347
there are 3 ways to build a website:
1) build it yourself (google pages or geocities.com) if you have html knowhow
+ cheap
- low quality or even not feasible due to lack of know-how
2) use a local professional webdesign studio
+ most professional
- very expensive
3) use a content management system (e.g. http://www.domegos.com/Vacation-Rental-Home-Website-Design or http://www.choice1.com/web_development.htm)
+ cheap
+ professional look
+ quick
- difficult to customize
hope this helped
Another common mistake and IMO not a good use of funds. Your own website is only part of the equation. How will visitors find your site? How will they know www.yourvr.com? Again, using a Property Management Company has more resources to get recognized on the web and on a google or yahoo search.
Hi,
Great tips. As a property owner myself I can tell you that these tips are a great start. However competition is getting more fierce and as time passes you definitely have to take the extra step to attract guests to your home. What I did is I try to advertise in the biggest websites to have most of the market in the US covered. Of course homeaway, which is also vrbo, and Rentalo.com which is their biggest competition at this point. Besides that an important thing is Customer Service. This will help in word of mouth advertising. If guests feel good in your home they will probably recommend your place to others. I found a really good article related to this here: http://blog.rentalo.com/owners/2008/09/how-to-make-your-guests-come-back-to-your-vacation-rental-key-points-of-unrivalled-customer-service/
I hope this really helps those who are planning to invest in a vacation rental property.
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