If you own a short-term vacation rental property, you’ll want to do everything you can to maximize your profitability. Here are 10 simple tips we recommend to help you improve your ROI and increase your vacation rental income:
It’s a good idea to update your listing description(s) and photos at least a couple times of year. This is how you make the best first impression with potential guests browsing through dozens of available vacation rental listings on AirBnB, Vrbo or whatever other booking site(s) you are using to promote your property. Make your descriptions appealing, yet accurate. In other words, don’t lie or exaggerate too much because that can come back to bite you later. Include high-quality photos that will help your listing stand out. Don’t be afraid to hire a professional photographer, home stager/interior designer and copywriter to make your rental look and sound as appealing as possible. These are investments worth making!
You are never just limited to posting your vacation rental on one listing service. Sure, it will cost more to post your property on multiple sites, but it will increase your marketing exposure dramatically. More exposure means more potential renters seeing your listing. More renters mean more demand and, eventually, the opportunity to potentially raise your prices for better profitability.
Most vacation homes are seasonal. Beach homes will do better in the summer. Mountain homes might do better in the winter if near a ski resort. You should utilize a variable pricing model to determine when your rental will be in highest demand. Look at similar rentals, study the market patterns and price yourself strategically throughout the different seasons for maximum profits.
Short-term rental listing services allow you to automate more than ever. Your bookings, check-ins/outs, payments and just about everything can be done digitally. You can pre-schedule and manage cleaning services. Use a lock box to minimize interaction with guests. There are many third-party apps and services that will help you streamline your rental business.
Study your competition, research your particular vacation home/resort market and listen to your guests. Over time, you should be able to understand which amenities will make your vacation rental as desirable as possible. Make upgrades and add little touches as necessary. A more appealing listing means more rental bookings and potentially higher rental prices.
In addition to the amenities of the rental space, don’t forget to focus on customer service. You want to make your guest feel at home in your vacation rental. Don’t force yourself upon them because some people won’t like too much attention, but always make yourself available. Leave welcome notes and clear instructions. Let them know you are just a phone call or text away if they need anything. This is how you build a stronger reputation.
Another way to win over your guests is to add special perks. You might allow for later checkout times or provide mid-stay cleanings if they are there longer than a couple days. Learn from the hotel/resort industry and apply some extra perks to make sure your guests enjoy everything about their stay. This is how you generate repeat guests and positive referrals/reviews/ratings.
Periodically, you should review all your processes and the property itself. Read your reviews carefully and go over the books regularly. This will allow you to see what is working and what isn’t. Then, you can continually adjust your investment plan approach to improve processes and maximize profitability.
Remember you are paying for utilities when you own and manage a short-term vacation rental property. Install smart thermostats, improve insulation and door/window seals, and look for ways to reduce your carbon footprint. Most guests will appreciate a modern, eco-friendly space while you will be able to save money on your utility bills over time.
Always remember that your short-term rental is a business. Whether you rent it out all year round or only a few times a year, it is a source of vacation rental income. It should be treated as a business. Take the time to develop a solid business plan and also a strategic marketing plan.
These are just a few helpful tips to help you maximize your profits when running a vacation rental. For help with developing your rental business plan and managing your finances, contact Illumination Wealth today.