The following post is by MPFJ staff writer, Marie. You can read more of Marie’s articles over at her own blog, Family Money Values. Enjoy!
If you own a vacation home, you may have considered renting it out to help cover the costs. Many resort area area complexes have their own on site rental management companies to manage the short term vacation rentals.
Using these types of rental services can make the job of renting easier, but there can be issues with professional rental management.
They have control over which of the complex’s units are rented for example. If there isn’t an equitable process in place to distribute the rentals among all of the unit owners, your unit may not get rented enough to pay many of the operating costs. This happened to me with our vacation rental. The professional property management service owner also owned units in the complex herself. Guess which ones were always rented out first?
They charge management fees, re-stock fees, maintenance fees and more. The base rate for our old management firm was 38% of our gross rent! Onto that, were added $10 per stay to buy supplies to restock (no matter how many of the items stocked were or weren’t used), $25 per maintenance item – which were done without consulting the owner (items such as cleaning the furnace filter); $85 for each cleaning up after guest stays and on and on.
They write terms into their contracts that dictate what you can and cannot do with your own property. Ours reserved the right to inspect the quality and condition of the interior decor and furnishings and not rent out our unit if they decided the inspection failed.
Property managers in our state are supposed to be real estate professionals. Ours wasn’t, but somehow was ‘exempted’.
You never get to know who is staying in your property and have no say over who does stay.
You typically don’t get to set the rental rates for your unit.
You have to rely on your rental management to relay any guest comments about your property.
After several years of paying exorbitant fees and suffering from non-rental of our unit, I decided to try self management of the property. Although many resort rentals are in condo, hotel or apartment complexes, some are stand alone homes. Finding a local property management company may be challenging in that situation.
We found the benefits to be satisfying. Not only do we get the full rental amount (not having to fork over 38% of the gross rental), but we have also saved on maintenance and supplies as well as being able to deduct some of the expenses off our passive and regular income.
There is a cost, however, and that cost is my time.
Each year I do a top down cleaning and re-painting of the unit. I wash all linens, windows, rugs, fans, closets and etc. I visit the property (which is located some 200 miles from our home) several times a year to check in on it, perform needed maintenance and purchase and organize supplies. I spend time answering rental inquiries, keeping books, sending payment invoices, answering calls, updating web sites, rental agreements and more. I find that I enjoy the activities and over the years have become more efficient in handling them.
Here are some of the ways I have found to make self management of our vacation rental easier.
Market to generate rental inquiries
By far most of my inquiries come from Vacation Rental by Owner (VRBO), which the only commercial site I use. I chose VRBO because my property is smack dab in the middle of the USA and this site markets to that audience. It also has so far allowed me to control most aspects of pricing, booking, describing and etc for my property. I recommend that you do use a popular commercial site to market your rental, but pick one that matches your style as well as the type and location of your rental.
I also have built my own website, using Word Press as the content management system. Word Press is a free and easy to use tool to build a website and comes with many free ‘themes’ – or designs – which you can use to build out your site. No coding expertise is required.
In addition, I’ve listed the property on our state’s main visitor web portal.
Pricing is key as well. Most commercial sites will use your rates as one of their sort criteria, to determine how far to the top (or bottom) of the search results your property lands. Typically you set multiple rates, depending on what season you are renting. Higher prices for the popular seasons.
Hire a reliable cleaning/maintenance service
You have to have a good cleaning service if you are not local or if you don’t want to do the cleaning your self. In addition you have to have yard maintenance, snow removal and the like services.
Since my property is included in a condo association, the association handles all of the outdoor maintenance.
Cleaning services should have the following characteristics to be considered reliable:
- Someone local who can handle the workload and clean between same day renters.
During the high season, you are likely to have someone checking out of the unit the same morning that someone else is checking into it. Your cleaner has to have enough resources to get your unit cleaned, checked and resupplied in that short window or your afternoon renters will be hanging out waiting to get into the unit while the cleaners finish up.
- Be willing to clean/do laundry/perform minor routine maintenance light battery & light bulb changes; supply replenishing and repurchasing.
In addition to cleaning, your housekeeping service would do well to make sure the beds are changed and the linens washed and stored for the next guest set (you want enough linens to have two sets for each bed so that one set can go back to the cleaner to get washed while the guest is using the other set). Ask them also to check batteries (in remotes, clocks, door locks, etc) and light bulbs and change them out when needed. They also will be responsible for replenishing any thing you stock for your renters (such as coffees, teas, toilet tissue and more) – and a reliable cleaner may even provide an extra service (at an extra charge) to go to the store and buy anything that you run out of.
Have a local emergency contact
In addition to (or as part of cleaning services) you need someone local who will come in emergency situations on an as needed fee based service.
Things happen. Renters want to know that there is someone in the area who can come when they do. I’ve had situations where the renter can’t get in the door, or where they wanted someone to come over with a metal detector and check for fish hooks in the carpet – as examples. Your emergency contact should also be (or have on call) a handyman service that do things such as unclog a toilet. My cleaning service has a handyman on call for these things. Besides those types of services, you need to have a method to handle bigger maintenance issues, such as replacement of faucets or ceiling fans. For these I currently rely on big box subcontractors – such as those that work for Home Depot or Lowes.
Make entry possible without needing on site help
Folks used to mail keys back and forth when they managed their own remote rentals. Thank heavens that isn’t needed anymore! Instead of paying someone to check in your guests, you can now install a key-less door lock so the guest can let themselves in.
At first I used a Kwikset lock – which allowed the guest to enter a 4 digit code to unlock the rental, but each code had to be set at the physical door lock. I had my cleaning crew reset the code each time the renter changed, but they forgot to do so multiple times, resulting in a late night scramble to get the next renter into the condo when they tried to use the new code. This type of lock only allowed 2 active entrance codes at one time. It presented an issue for me when I needed to allow someone access for the day, to say, let the exterminator in to spray or allow the association manager to enter the unit. Once given, the code was active until changed at the door, which I didn’t particularly want to do.
This year I am trying a lock which allows the entry code to be set remotely.
There are multiple types of locks now which allow new entry codes to be set remotely. I picked one that did not require wifi to be up and running, since we have frequent electrical storms which can knock it out at times. I can sit on my couch 200 miles away and generate a code for someone to use for one day, multiple days, long term or for just a few hours. It cuts out the need for anyone to be at the door setting the code.
However, it still uses batteries. So, just in case, I do have a key on premises, outside, locked up in a key save. I had to use this method to allow guests to enter last year when the codes didn’t get set for them.
Remotely manage as much of the home environment as you can
Although our unit is not yet equipped for it, I would recommend that if you self manage and are not close to your rental, that you set it up so that you can turn the thermostat up and down, turn out the lights or lockup the unit remotely.
Just one light left on during the long winter vacant period cost money in utility bills.
Make extra supplies accessible when needed
You probably stock certain things for your guests to use during their vacation. I’ve found that leaving extra supplies out in easy reach is too tempting and they disappear. One thing I have to have available however, are parking permits. Without them, the renter’s car could get towed. In the past I relied on my cleaner to put them out, and they often forgot. Although I have a printable version of them, emailing that to a vacationer doesn’t do much good. Therefore, I have learned to leave extra passes in a hidden, but guest accessible place. Then if they call saying there aren’t any passes, I can tell them where to go to find them.
I have lock out closets where the other extra supplies are kept and keep keys hidden inside the condo to get at them (mainly so the cleaners have access). I could, if needed, also allow guest to access the keys on an honor basis to get into the supplies. However, to date, I have not done that. After all, the store is only 15 minutes away for them.
How about you all? What tips do you have for easier self management of vacation rentals?
Share your experiences by commenting below!
***Photo courtesy https://www.flickr.com/photos/7493568@N02/1368668021/
