How To Get the Most Out Of Your Vacation Rental Property
Warming weather is a usually a sign that summer is right around the corner. For many real estate investors this signals the start of their vacation rental property season. Even if they have found tenants the last few months their peak season is typically May to September. How well they do in these few months will often determine their success for the entire year. Your rental may be in a great location and generate demand but there are still a few things you need to do to keep your property booked and your tenants happy. Here are five things you need to do to ensure vacation rental property success.
- Market To The Right People. The best vacation rentals are those that can rent on a weekly basis during peak times. To do this you need to keep your property booked months in advance. Even if you have a great property you need people to know about it. Positive word of mouth is nice but may not be enough to fill vacancies. You need to constantly focus on marketing to the right people. Start by researching the marketing for the local area the property is located in. Get your property in as many local publications and websites as possible. Additionally you should establish a relationship with a local real estate agent, or two, that can help find tenants. This will come at a cost but whatever the cost it is typically better than a vacancy. Once a tenant stays at your property you should put them in your database and send them an email every season. How well you stay on top of finding new tenants directly determines you vacancy factor.
- Get A Good Team In Place. In addition to a good local real estate agent there are a few other people you need on your team. Most vacation rentals are not in close proximity of where you live. Even if they are relatively close it is not worth it for you to travel 30 minutes each way a few times a week. This underscores the importance of having a good team around you. Start by hiring the best possible property manager. They will be responsible for running the day to day operations of your property. They will handle any questions that your tenants have and take care of minor issues that always pop up. Along with a good property manager you should also find a good local handyman. You never know when a toilet will clog or a lock needs to be changed. Your tenant only has a week or two in the property and it is essential that things are fixed quickly. The final team member is a good cleaning company. Your vacation rental needs to be turned over much quicker than regular annual rentals. These properties may only have a few hours before the next tenant enter. A reliable cleaning company can help make your property presentable and your tenants happy.
- Furnishings And Updates. A good vacation rental is often judged more on the location than the amenities. That being said you can’t ignore the interior. Your property should be treated like the investment that it is. If you spend money on certain furnishings and updates you will see a return on your investment. You don’t need to break the bank with your updates but your tenants should open the door and feel comfortable living there for a few weeks. You want to have a balance between quality, practicality and luxury. Look at other rental properties in the area and make your updates accordingly. If your rental is just a little nicer than your competition at roughly the same price you will have an easier time finding tenants.
- Screen & Security. Every property owner wants to find tenants as easily as possible. As a vacation property owner you fall victim to this as well. Even though you may need to fill a vacancy it doesn’t mean you have to lower your standards. One bad tenant can do significant damage to your property. You need to spend as much time in screening tenants as you would for any other property you own. Take the time to review the application and call any references listed. If you have some doubts you should not hesitate in finding someone else. Once you settle on a tenant you have every right to ask for a security deposit. If your tenant causes damage this is the only recourse you have as protection. As long as this is clearly disclosed this should not be a problem with your tenants.
- Understand Local Market. Your rental will be compared to every other one in the market. Because of this it is important to understand your competition. Look at publications and websites and see what else is out there. Rental prices may have shifted one way or another. There may be an influx of properties that are well below your asking price. Certain properties may offer certain amenities that make them appealing. The better you understand your market the easier it is to price your rental accordingly and make any necessarily changes to attract tenants. Even if you have a property manager you can’t rely on them for everything. It is still your property and you still impact the bottom line. Your market may change every few months. It is up to you to stay on top of these changes.
A well performing rental property can be a great addition to any investment portfolio. There are times when they require a little more work on your end. By doing just a few little things you can keep your property full and increase your bottom line.