How Much Money Can You Make from A Vacation Rental?
The travel industry is bursting at its seams with more travelers exploring the world than before. Whether it is continent-hopping or a weekend beach getaway, travelers are beginning to explore more in terms of accommodation options and are also willing to pay handsomely for a comfortable and memorable stay. This has made the travel markets somewhat disruptive with respect to innovation in terms of accommodation.
Hotels, B&B as well as home-stays have found the need to constantly innovate and stay updated with market trends to provide quality services. So what does this mean for a vacation home owner who would like to list their property for vacation rentals?
You have a huge audience willing to pay well for a vacation rental if your home offers them with a lasting experience. This means that your second home can become a source of steady income if you market it properly and offer quality hospitality to your guests. The money you end up making from your vacation rental will greatly depend on the following factors:
Is your home located to a popular tourist spot? Homes
near tourist spots earn more, especially if the tourist spots are open round the year. But homes away from tourist spots require a strong marketing campaign to place the vacation home as an enticing spot in the minds of your audience.
Homes that are set in quiet spaces are likely to attract a lot of guests provided that it is not too far away from a city area and where users can easily drive down. Accessibility plays an important role because some guests are not in the position to travel too far into quiet country homes if they are traveling with kids or elderly family members.
2. Outdoor scenery
If you were to read online reviews of vacation rentals, then you would notice that a lot of attention is paid to the outdoor scenery. Scenic views increase the beauty of the place and improve your guest experience too. Attractive photos of the outdoor scenery left by past guests in their reviews can drive a lot of customers to your vacation rentals
3. Access to amenities
Vacation rentals may end up being in areas where facilities and amenities are important because your guests may not find any of it close-by. For example, coffee machines should be fully functional as your guests may not be living near coffee shops.
Your kitchen should be well-stocked, the television should be working, and the water fittings should be in place. These are basic amenities that drive guest experience, poor maintenance of these amenities, or their unavailability can lead to a negative experience for your guests.
4. Taxes, insurance and maintenance
A generous part of your income will go towards the taxes, insurance and the maintenance of your vacation home. If you do not consider these, the price set for your vacation rental may not be adequate to cover the working costs and to create a steady income flow for you. Talk to the experts to understand taxes and how these can affect your annual income from your vacation rental. The taxes will depend on how long your vacation home is kept for personal use and how long it is on rent in a year.
Even regular home insurance may not be enough to properly cover any losses. An insurance agent will be able to identify the best insurance for your vacation rental.
Lastly, maintenance is going to run up big bills. You will be employing a cleaning crew for all the time that your vacation rental is being used. Additionally, the electricity and water bills will also depend on the occupancy. Regular wear and tear must be considered as well before deciding a suitable rental.
Income is generated from your vacation home only when it is occupied. So vacancies are a source of problem for any person who rents vacation homes. Vacancies can be caused because of bad reviews, competition, inaccessibility of your property, and off-season. You must deep dive into identifying the root cause and finding an effective solution for it.
For example, work towards improving your guest experience if you have bad reviews. Respond to the reviews by positively reinforcing trust in your guests. To deal with the competition or to handle off-season sales, marketing is an important tool. As for inaccessible property, make it your home’s unique feature and sell the inaccessibility positively as a way of enjoying quietude and peacefulness.
If you choose to manage the property yourself, then your vacation rental will save the management costs, which can otherwise be anywhere between 20% and 50% of your rental rates. You can either save time and the hassle of running it yourself or you can manage the property and enjoy higher financial gains.
An important factor of earning a substantial income from vacation rentals is marketing. The internet and social media platforms have lots of eager travelers looking for a good vacation home. But at the same time, there are lots of vacation home owners offering quality services and beautiful homes at decent rates.
To attract customers, you must market your vacation home. You can either depend on us to do it for you, or you can use social media platforms to share photos of your vacation home and positive reviews of your customers to expand your audience reach.
These factors will determine the price you set and the income you receive from your rental. Additionally, here are a few ways in which you can improve customer experience, which can, in turn, affect your reviews and also attract more customers to your vacation rental.
1. Maintain a spectacular first impression
Shabby homes won’t fetch high rentals. People are more likely to choose vacation homes which are clean and have a beautiful view. Whether it is your own photographs or customer photos, your house should always look beautiful on the internet. More people will click to check more pictures of your home if they see a beautiful view of your house from a review or from your own photos shared on social media platforms. Hire a professional photographer to click spectacular photos which will get more views.
Also, invest in creating beautiful outdoor spaces. Your guests won’t be sitting inside the whole day. They want to know that they can roam around a beautiful farm or walk down a jetty or sit in a beautiful patio to spend their vacation time.
2. Be courteous online
Many vacation home owners find it difficult to handle negative reviews left by guests. But it is important not to spew your anger on the internet because everyone else is watching. Your courteous replies will garner a more positive impression of you when someone tries to go through reviews of your vacation home. Also, make it a habit to respond quickly and positively to all customers.
3. Keep an updated calendar
It is easy to forget updating your room availability calendar when you are handling a rush of customers but imagine your reputation being hampered when you have to turn down new guests because your calendar was not updated. This calendar helps you check if a room is available on a certain day or not. Updated calendars will make sure that your customers get the right information and will help you create better guest experiences.
4. Invest in building quality living spaces
The hospitality industry is very competitive. This is why your guests will come to your home with very high expectations. You can’t just use beautiful photos of your home from five years ago to create a good online impression and then welcome your guests to a neglected living space.
Careful thought should be given to keeping up quality living spaces so that your customers can thoroughly enjoy their stay without having to constantly overlook the condition of their rooms or the kitchen or the living area.
5. Keep a manual and a list of local attractions available for all your guests
Customers appreciate attention from their hosts. One way to increase their satisfaction from staying at your home is by providing manuals for using appliances and also offering them a list of local attractions that they can explore during their stay. This will get them to enjoy their vacation even better and it will also reduce the chances of appliances being misused during the stay.
In a nutshell
Vacation rentals are not for everyone because they require market acumen and they require you to have an affinity for the hospitality industry. As a host, you may be dealing with people from several walks of life. These interactions would eventually become lasting memories for many of your guests. In the end, it may not even be as much about the money you make as about the experiences and lasting guest relationships that you create as well.