Launching Your Vacation Rental Business
Starting your own business is always exciting, and when you know that your venture is going to bring you big bucks, it is double more exciting. One of the viable ways to make money without painful efforts and huge initial investments is to lease out your property for short-term vacations.
Becoming a short-stay vacation rental entrepreneur is a wonderful opportunity to enjoy passive income along with meeting new people from all corners of the world, learning new cultures, and improving your personal soft skills (which are must-haves nowadays). In this guide, you will learn what it essentially takes to launch your vacation rental startup and make it successful.
Is the short-term vacation rental business profitable?
When you get into a new business, the first question to come to your mind is “Is it profitable?” or “How much will I gain?” Till very recently, short-term vacation rental business was tremendously profitable, for instance, the revenue of the Airbnb rental marketplace was nearly $5B in 2019!
Surely, due to a pandemic, rental prices fell in most regions because people fear to travel and because many international borders are closed. But this will not last for long. Very soon, the pandemic will subside, and globe-trotters will make up for the lost time, rushing to every city and throwing their cash around on thrills and, surely, stays. So, it makes sense to start sprucing your property up right now, so it shines and welcomes when adventure-hungry travellers come to your place.
On average, each Airbnb homeowner makes $100,000 annually, which is very inspiring. Of course, the overall income will depend on several factors, including the type and condition of the accommodation, the level of service you provide, your managerial efficiency, and an ability to shoot troubles (which will certainly arise because not all the guests are made equal, some of them may be slightly or hugely inadequate).
No matter the kind of lodging you are listing, one of the best strategies to maximize your profits is to implement an auto-pricing model that adjusts your rates per stay based on the market situation, thus, allowing you to make the most money from your lodging according to the seasonality and demand. Learn more about the advantages of a dynamic pricing model here.
Who can benefit from the vacation rental business?
Almost anyone can become a short-term vacation rental host. Even if you do not have a property or shared space to advertise, you still can have a side income on platforms like Airbnb if you, for example, can arrange adventures and experiences for tourists. Online rental brokerages like Airbnb and others of its ilk give you an opportunity to list literally any dwelling where holidaymakers can spend a night with comfort and safety, be it a condo, a summer house, or even a hunter's lodge in a thick wild forest.
Sometimes individual hosts join efforts to manage a property together, such an approach is called co-hosting. Real estate agents, multiple-property owners, and hoteliers form a group of professional, large-scale hosts who exploit Airbnb to target a larger audience and increase their business coverage.
Experience providers are local craftsmen and experts who are marketing their services on Airbnb. Though such people do not list their properties, they, still, can brighten up your holidays by arranging your leisure during your stay by, for example, taking you to the most interesting (or secret) places in town, offering unusual master-classes, or showing you other things-to-do.
In general, everyone, who has a spare room to sleep in or knows an interesting activity to do, can benefit from advertising on short-term rental sites like Airbnb.
Where can you advertise your short-term rental property?
When you decide to run such a business, another troubling question to occupy your mind may be “Where can I promote my short-stay vacation rental space?” Luckily, your options here are pretty Large and cheap.
- Airbnb. Thanks to its mega-expensive, creative marketing campaigns, Airbnb firmly sets on the top of the competition in the vacation rentals industry.
- VRBO. With over one million listings worldwide, this platform is a good choice to start advertising your property.
- TripAdvisor poses itself to be the largest travel community, so why not capitalize on its abundant audience?
- Booking.com allows you to list virtually any type of accommodation in any spot on the globe.
- Expedia is a comprehensive travel site for those who seek accommodation and those who offer it.
- HomeAway is another industry giant to publish your longing with a minimal fee.
Quick Yet Powerful Tips To Start Your Vacation Rental Business
Investigate your local laws and regulations to make sure short-term rental business is allowed in your locality.
Create your business plan: outline your goals and think of how you will achieve them.
Make your rental property comfortable, lovely, and secure. Your guests come from another place and expect to feel good and safe in your home, so provide this.
Set a competitive price. Do not charge too low to avoid missing revenues and avoid the wrong crowd, as surely as do not raise the bar too high to scare potential guests away.
Manage bookings and inquiries properly. Keep your reservation calendar updated to avoid frustration and prevent schedule conflicts. If you cannot boast of excellent managerial skills, you can apply to dedicated Airbnb automation management software such as. Such software saves your time and efforts by automating everyday business operations, including managing bookings and client reviews, automating guest communication, accepting payments, arranging cleaning and upkeep, adjusting your rates based on demand, and much more robust features.
Think of how you will maintain and repair your property. Decide whether you will take all the cleaning/repairing tasks on yourself or would hire professional cleaners to do that nasty job for you. Decide how your quests will get the keys (will you welcome them in person or use smart devices like Lock Box?). Do you want to solve all the questions by yourself or employ a professional short-term property manager to save you from this headache? Remember that outsourcing help may significantly affect your rates per night.