You’ve decided that turning your second home into a vacation rental is the right move for you.
Getting your first reservation on the calendar is an exciting time, but — as you probably figured out while you were deciding to rent your property — there are things you need to do before you can throw your doors open.
Dot your i’s and cross your t’s
Most cities have regulations for vacation rentals — often called “short-term rentals” or detailed under “transient occupancy tax” — so do your research so you know what you’re getting into.
Beyond understanding local policies, be aware of any taxes you’ll need to collect and file any necessary paperwork.
Once you’ve worked through all the regulatory stuff, make sure you have the right insurance for your property. You never know when natural disaster or an unruly guest might come your way, so make sure you’re covered.
Finally, make sure you have your own rental contract and a set of policies and procedures that meet your needs, as well as anything else the bureaucrats or insurance reps may have flagged. Have a lawyer review your documents — or write them — to ensure that what you’ve put together is legal and doesn’t overlook anything.
A space that looks great and is well-equipped
If you like decorating, this step can be a lot of fun! If you’re less design inclined, or your property is already essentially prepared for guests, make sure you at least have the basics on hand; some things are “nice to have” but there are essential items that your guests will miss if you forget about them.
For ongoing care and monitoring, now is a good time to decide whether you want to hire a property manager or do it yourself. Depending on your circumstances, there may be a clear solution. Your proximity to the rental property, for example, may make the decision for you; some cities require that a contact person be within quick driving distance to the property in case of emergency.
Even if you need to hire a property manager to be close at hand and available if your guests need anything, there are a wide range of services available — from full-service management to task-specific support. Find out what’s available in your area and hire the type of help you need.
Setting your rates
Once you know what your hard expenses are (i.e. property management, insurance, cleaning services) you’ll need to determine your rates.
This is something that is intimidating for a lot of owners. Follow our four-step guide to setting your rates so you have a starting point, then monitor how things go and review your rates regularly.
Get the marketing party started
Marketing your vacation rental is an interesting challenge. Some people find that their home — or the location — all but sell themselves from Day One, while others struggle to find the right people to attract.
We write about marketing on this blog a lot; effective marketing is the key way to get more renters with less work and it can take a lot of experimentation just to find tactics that work for you. Here is some advice we think applies to all owners:
- If you’re new to marketing, familiarize yourself with some of the lingo you’ll see as you start reading more about it.
- Find out why listing sites alone don’t cut it; having your own website can make a measurable difference when it comes to getting and increasing your bookings.
- That said, listing sites are an important part of vacation rental marketing. Once you choose a site, make sure you create an eye-catching listing that will attract and hold attention.
- You have a website, and you have an awesome listing. Make sure the two are connected! Link to your website from HomeAway, VRBO & FlipKey.
The vacation rental industry is growing — and so is your competition. Listen to advice from other owners and follow news from sites like MyVR to stay on top of what’s going on.
What questions do you have about starting a vacation rental? Share them in the comments below!