While some may consider vacation house rental to be more of a hobby, smart owners know that their rentals have the potential to act just like a small business. If you’re renting out a spare room for extra pocket money, you likely aren’t too worried about growing your investment. On the other hand, if you are serious about making your rental a success, you need to get real about how you go about making a profit.
There is no doubt that Airbnb has changed the short term accommodation market in cities all over the world. In Cape Town, short term rentals make up a growing percentage of all properties purchased in areas such as the Atlantic Seaboard and CBD. Many apartment and villa owners are keen to take advantage of this growth. But, while some will reap the rewards, others may only see a small return on their investment. The trick to succeeding in this industry is to treat your vacation house rental much as you would any other small business.
Running Your Vacation House Rental as a Small Business
You likely would not ‘wing it’ if you opened a small cafe or started an online shop. Why then is vacation house rental still seen as a side-line venture? Even if you are only renting out one property, you have the potential to make a living if you approach things in the right way. Some of the ways that you can start treating your vacation house rental as a small business rather than a some-time hobby include the following:
- Have a solid plan in place. How will you grow if you do not have a plan? Whether you work with a dedicated vacation rental manager to work out a rough projection, or develop your own unique plan, this should be the very first step before you begin promoting your rental. Create a basic business plan that outlines your target audience, threats, opportunities, strengths, weaknesses and strategies that you will use to grow your rental’s success.
- Invest in professional management services. Without fail, a professional short term property rental manager will ensure that your rental is managed at every step of the way. From marketing to day to day management, guest concierge and bookings management, a manager will help you get a competitive edge. This leaves you free to focus on the many other things you have to do, knowing that an expert is taking care of your rental.
- Get smart about marketing. Marketing is vital for vacation rental. Your property will need to be featured on major listing sites, so that guests can easily find you online. If you are not listed, it will become impossible to maintain a decent booking rate. This in turn will make it far harder to succeed in the highly competitive short term rental space. You can be 100% sure that if you are not listing, your direct competitors certainly are.
- Put your customers first. Like any other business, customers should be the most important thing. Taking a customer-centric approach will ensure that you always deliver the very best level of service to your guests. It will also motivate you to constantly evaluate your processes to find new areas for improvement. A rental that puts guests fist will always succeed over one that fails to value their guests.
- Stay ahead of market trends. You will have to continually monitor industry reports and trends to stay ahead of the competition. Whether it is new technology such as keyless entry, Fibre internet, automated home systems or something as simple as a new marketing outlet, you can never afford to ignore trends.
Every single business requires a great deal of investment in time, strategy, money and effort. To ensure that your vacation house rental gets the best possible returns, be sure to partner with a short term property management service that truly understands your vision and goals.