Should you be your own host or hire a professional property manager?
One of the biggest considerations a vacation rental host has is whether or not to manage your own property. While the DIY-approach may make sense if you have the technical know-how, free time, and local connections, sometimes hosts are better off outsourcing property management to an expert. This much is true: there isn’t a one-size-fits-all answer. In order to help you make the right choice, here’s a rundown on the reasons for and against hiring a property manager.
Reasons to Hire a Property Manager
Marketing and Advertising Your Property
The first area in which a property manager can help is the marketing and advertising of a property. Creating a website, distributing the listing on various channels, targeting demographics with strategic ad campaigns, and developing a social media strategy are all within the domain of a property manager. The best property managers help create a cohesive brand around your vacation rental business (whether you have one rental or dozens of them) and help you attract clients to book directly.
Managing Guest Communication
Responding to every guest inquiry can take its toll, especially when guests tend to have similar questions. Fielding concerns before arrivals, during stays, and writing and responding to reviews is much more intensive than many hosts imagine. For this reason, managing guest communication is one task traditionally handled by property managers. That said, before agreeing to terms with a management company, be sure to establish if communication will be automated or if a real person will be in communication (many larger companies use software that automate replies).
You Live Far Away From the Property
Perhaps the most practical reason to hire a property manager is that you live far away from your property. Handling maintenance requests, welcoming guests at the door, and generally being on-call is difficult to do from a distance. Especially if the house or apartment is in a foreign location, it’s best to hire a local who knows the surrounding area and has connections. If distance is the only real reason for hiring a property manager, consider going with a co-host – you take care of all the marketing, communication, and administration, but your co-host handles guest check-ins and cleaning.
Help Setting the Rates
Pricing — along with amenities, location, and guest experience — is one of the most important considerations when managing a vacation rental. There are competing theories on which strategies work best, but the truth is that pricing should be set on a case-by-case basis. Hiring a property manager helps hosts dynamically price their listings. Property managers use a slew of market research and data intelligence from companies like AllTheRooms Analytics to help optimize the price of each listing. Take full advantage of peak seasons and make the most of the off-season by hiring a property manager.
Reasons to be Your Own Host
Property management fees are undoubtedly the primary reason people opt to handle the work themselves. Depending on the services provided, fees can range anywhere from 10% to 40% of the total revenues earned. So, if you have the time and the skills, managing a property yourself can make the investment much more lucrative.
Finding a Reputable Manager
Vacation rentals have ballooned into a $60 billion industry with over 115,000 rental companies around the world. The once-niche market has now become commonplace in all major (and many non-major) cities around the world. As a result, there are tons of offshoot companies. At first glance this seems to be positive for the industry – but it also means there’s a relatively low barrier to enter the marketplace.
Many people advertise themselves as credible co-hosts, marketers, managers, and cleaners with little experience. As a result, hosts may get caught working with a manager who is less qualified than they appear.
Being Out of the Loop
Another potential disadvantage of not managing a property yourself is the fact that you’ll be quite removed from the daily operations. If you’re more of a hands-on host, contracting a property manager may give you more anxiety than relief. While communication is paramount between hosts and managers, some things are bound to get lost in the commotion.
Consider it a Hobby
For hosts new to the industry, this may be the most compelling reason to learn as you go. People who invest in vacation homes do so in places they love, which often means they love to host. For someone passionate about the culture, weather, lifestyle, food, and nearby attractions, property management becomes more of a hobby than a chore.
There are Many Free Resources
Finally, the internet. Free, valuable vacation rental content is extremely easy to come by on the internet and there are plenty of vacation rental blogs offering advice and insider tips. These resources produce consistent content on how to be a great property manager without spending too much time or money.
The real key to deciding whether or not hiring a property manager makes sense is to ask yourself the right questions. Are you comfortable and capable of keeping good records? Do you have the knowledge to handle minor repairs? How savvy are you with digital marketing? Have you worked in customer service — and if so, did you get frustrated easily? Starting with these questions is a great way to determine whether or not a property manager is right for you and your rental portfolio. Good luck!