- Make a financial plan.
- Set a rental rate.
- Have a property management plan.
- Learn landlord tenant law.
- Set rental policies and write a lease.
- Create a marketing plan to rent your house.
- Meet and screen potential tenants.
- Document your rental and protect their security deposit.
How to Start a Vacation Rental Business
It’s always exciting to start new endeavour that provide you with a way to make money and enjoy what you’re doing. If you own (or have recently purchased) a property and want to use it for investment, starting a vacation rental business is one way to do it. Investing in a short term rental property is an exciting venture that gives you the opportunity to meet new people, learn new things, and make money! If this is something you’re interested in, keep reading our article to learn how to start a short term rental business.
Step 1. Create a real estate business plan
Before you get your vacation rental business started, it’s important to know what you’re going to do and how you’re going to get there. One of the most common mistakes beginner real estate investors do is jump in and get in over their heads. In addition, one reason that they fail is that they don’t treat their investment like a business. A vacation home investment is more than just listing your rental property on Airbnb and waiting for the money to roll in. It’s a business and, just like any other business, you can’t expect to succeed without a business plan. Therefore, the first step to starting a vacation rental business is putting together a real estate business plan that outlines your goals and keeps you on track.
Step 2. Get the propertyready for guests
It’s important to keep in mind the comfort and convenience of your guests when preparing your home. If you’re working room by room to upgrade your home, focus on kitchens and bathrooms first. These are the rooms where guests expect cleanliness and functionality. Whether you’re going for a luxury vacation rental or something more fundamental, guests expect certain amenities in their home to ensure a comfortable stay. Make sure you equip your home in a way that allows guests to feel at home.
Step 3. Set the prices
One of the hardest parts of marketing your vacation rental business is to find the sweet spot for your nightly rates. Too high and it’ll scare guests away, too low and you may attract the wrong crowd or lose money on your bookings. One mistake many business owners make is setting their rental rates based on their own economic situation or emotional ties to the home. Check with comparable properties in the are to find a competitive price that guests will pay and that will make you a profit.
Step 4. Start advertising
Once the investment property is ready and prices are set, it’s time for the next step which is advertising. You need to get guests. You need to get your home in front of people looking to rent a vacation rental. Big vacation rental listing sites charge fees to list your home, but you’re bound to reach more people that way. Creating your own vacation rental business website is another way to advertise, and you don’t have to pay the commission as you do on more prominent listing sites. However, for the beginners it it is the best to advertise with popular Rental websites, as it saves a lot of your time and brings you the customers you need. The most popular vacation rental websites are: AirBnB, Expedia, VRBO, Booking.com, Tripadvisor,…
Step 5. Write captivating property descriptions that attract guests
When it’s time to write your vacation rental description, attention to detail is critical. A thoughtful description is crucial in getting potential guests to pick your home over the thousands of others they are seeing. Get creative, be honest, and really let the highlights of your home(s) shine. But don’t stop at the home description. Make sure to mention your commitment to excellence, your focus on the guest’s satisfaction, and your willingness to help.
Step 6. Use outstanding photographs of your house (and many of them!)
It is very easy – eye-catching visuals sell. Of course, a catchy description is also important, but you NEED totake amazing photos. If you can get professional pictures of the property done, by all means, spend the money to do it. Guests will click through 2-3 images before deciding to move on to another house. Some people won’t even waste their time looking at a property if there are less than ten photos. The more the better, but when it comes to photos, it’s quality over quantity.
Step 7. Importance of reviews and How to get them
Reviews are important for 2 reasons:
a. They help you rent out your property: Prospective guests read reviews carefully. Therefore, properties with positive reviews will enjoy higher demand.
b. Reviews can get you more exposure on the vacation rental websites: Because reviews result in higher demand, vacation rental websites will give higher priority to properties that have more positive reviews. And more exposure means that more people will see your listing.
And how do you get reviews for your vacation rental? First option is to ask for it. When guests leave, email them with a thank you and ask them to leave a review. Or you simply stand out and make the clients WANT to leave you a positive review. Have a fruit basket available (for free) for guests upon arrival. Or send them a thank you card/gift basket after their stay. The point is little touches can make a big impression. Also, be kind and polite and professional throughout the entire process. Make the entire booking process and stay as enjoyable for your guests as possible. When you do this, they will want to leave a positive review.
Now you’re ready for starting your vacation rental business!
It’s time to go for it! Not only is it fun, but it’s also a profitable property investment that brings a lot of rewards. After reading our article, now you have the knowledge of how to start a short term rental business. Good luck! 🙂