Homes and Rooms was set up expressly to support independent vacation rental owners, facilitating them to keep control of their own properties and rental incomes. Here are 6 reasons why you should not hand over vacation rental management – and why you don’t need to.Keeping your independence is becoming even more important as the big industry players look to expand at your expense. Two recent reports, one from from industry analysts Evercore, and the other on Skift, both point to moves in this direction. Readers of the Homes and Rooms blog may have seen our recent comments on ‘pesky owners’ and the big vacation rentals ‘collision’.
6 strong reasons to stay independentIndependence is something we passionately support. Here’s why, in our view, independent vacation rental owners should think it through before handing over their vacation rental management to any large agency:
- You will earn less money. The agency makes its money by renting out a property at a rate they think that property will achieve. Their profit comes out of that rental, as do the other costs associated with promoting and managing it. Run it yourself and, even if you can’t achieve quite the same level, you won’t be paying a large chunk to an agency for your vacation rental management.
- You will lose control of who stays in your property. Even if you don’t sign up for the full vacation rental management deal, you will often have no say on who rents your home. Agents may not have the same standards that you apply. Results could be extra wear and tear for which you will ultimately have to pay.
- Your payments will go through a third party. Hand over your vacation rental management and they will decide when guest payments are made – and how long you have to wait before you receive payment. With an agency paid in advance, this might be days or even weeks after the guests have left.
- You will have to decide ahead of time when you want to stay in your own property. If you sign over your property on a full vacation rental management deal, you’ll need to decide precisely when you may want to visit your own rental home in the future. You will no longer be able to just take off on the spur of the moment. We have heard of instances where owners have had to book time in their own properties on the insistence of an overbearing manager.
- You may have to bring your property to a standard they dictate. One owner known to us with a newly acquired vacation property to rent was told by the agent that she would have to replace the kitchen and bathroom; carpet throughout; and supply dressing tables and wardrobes for each bedroom. Unless she made these changes to the agency’s satisfaction, they would not have her on their books for vacation rental management. Effectively, she was being asked to make a large, up-front investment on the promise that they would be able to market her property.
- You may face expensive maintenance issues. What happens when things go wrong? Can you control the costs of repair and replacement authorized on your behalf by the agency? Most agencies will use their own maintenance staff and contractors to maintain your property and handle emergency repairs or replacements. They will select what they deem appropriate solutions but are not likely to be as vigilant as you might be in keeping costs down. Also, their priority is the guest and, as we all know, rapid fixes are usually expensive. Often, such charges carry an additional administration or ‘handling’ fee by the agency.