Starting a vacation rental business is a huge undertaking. Streamline property management software has a comprehensive understanding of industry leaders to give you all the tools you need at your fingertips. Without proper knowledge of how to make your vacation rentals profitable, you risk losing your investment.
Luckily, we’ve seen our fair share of vacation rental businesses come and go. Between the property managers who just bought their first rental and pros who run hundreds of vacation rentals, some commonalities exist!
Understandably, it can scare new property managers when their listings on Airbnb or Vrbo don’t see bookings in the first few months.
For this reason, we’ve summed up the basics on how to start a vacation rental business that actually makes money.
Do your research
If you’re reading this, you’re completing step one! Good research will prepare you well for your business’ future.
When you first begin your research, start by looking into financing options and potential location. Some property managers buy the properties themselves to manage, while others make offers to existing homeowners to operate their rentals for them.
Moreover, the location of your rentals will determine everything else about your property management brand. Read up on markets you want to enter and consider the different factors that could affect your business.
As an example, some markets, such as beachfront vacation rentals on the East Coast, can stay booked year-round. In contrast, some markets with more remote vacation rentals may have more variability in booking and availability.
One note on markets here: use your best judgement when naming your property management business. If you choose “Coastal Destinations LLC”, you may unintentionally limit yourself if you wanted to expand to mountain cabins or ski resort rentals.
Establish your brand identity and goals
In order to achieve your goals, you must identify them. Setting measurable objectives will help you and your company stay on track to meet your goals.
Ask yourself what your property management business wants to be known for.
Will you offer the most affordable vacation rentals in your area? Or, will you provide the most luxurious add-ons and amenities? Will your unique décor set your boutique rentals apart from the rest, or will your partnerships with local event companies give your guests the most memorable experience?
Think of your new vacation rental business as a person. In this way, you can more accurately depict your company’s personality and values, which will inform your brand identity.
Say your vacation rental business loves adventure and would rather spend money on experiences rather than designer gifts. They prefer the mountains over the beaches and love local cuisine and history.
In this case, ski-in, ski-out vacation rentals in smaller mountain towns may suit your brand identity. Position your rentals in the mountains and partner with local adventure companies to offer guests discounts on outdoor expeditions with them.
Invest in the right tools
As a new property manager, your end goal should be to own your audience. Getting your vacation rental business up to speed will almost certainly involve using distribution channels such as Airbnb and Vrbo. We advise you to view these channels as your training wheels, not your bike!
Once you outgrow these OTAs, you’ll want the right tools that give you full visibility into your customers. Some must-haves include a direct booking website and robust property management software for a seamless management experience.
This will also keep more money in your pocket when guests book directly with you instead of you having to pay OTA booking fees.
Streamline property management software has a comprehensive integration marketplace with industry leaders to give you all the tools you need at your fingertips. Investing in user-friendly tools such as these will help you scale your vacation rental business once you’re ready!
Starting a vacation rental business takes significant effort and investment. Depending on your goals and brand identity, the time it takes to scale your vacation rental business may take longer than others. Having the right property management software and other tools is essential to your growth as a vacation rental business.