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A Guide for Cabin Owners

A Guide for Cabin Owners

Thinking about investing in a cabin, or have you invested in one already? Turn your investment into a strong passive income generator. To help you get started, we've compiled a list of frequently asked questions from new cabin owners in the Smoky Mountains looking to sign with prospective Vacation Rental Management Companies.

Generating Revenue

Earning income from your investments is one of the greatest feelings in the world! When working with a property management company, know that they're doing everything they can to maximize the profit you get at the end of the day.

Q: Do I have a say in the amount of the nightly rental rate charged? 

A: No, management companies make this decision based upon their experience and many factors such as location, size, condition, amenities, etc. 

Q: If I allow my property to be pet friendly do I get a cut of the pet fee? 

A: No, this fee is mainly used for the extra cleaning. 

Q: Do you provide vacation insurance to guests and if so, do I get a cut of that? 

A: Not all management companies offer vacation insurance, so you should ask any perspective company you may be talking to what their policy is. 

Charges, Fees and Expenses

There are many charges, fees and expenses that are accrued when running any type of business. Renting a cabin is no different. You should be aware of any expenses you are charged and stay informed about what deductions are made from your payments.

Q: Am I responsible for the city and state taxes? 

A: Your management company will collect and pay the lodging and sales taxes. 

Q: Will I be charged Credit Card transaction fees? 

A: Most companies do pass those fees along to you or at least a certain percentage. 

Q: Are maintenance or repair services billed to me monthly or at the time of service? 

A: Most companies will pay the vendors and deduct that expense from you on your monthly statement. 

Entering Into a Contract

Once you've decided on the company you'd like to sign with, make sure to thoroughly review the documents you receive with your attorney prior to signing.

Q: Can I rent my property myself as well as have you rent it? 

A: Most management companies prefer that you do not rent the property yourself.  You would need to get clarification on this before signing a rental management agreement. 

Q: Is the management percentage negotiable? 

A: Most of the time yes, however there are some companies that prefer to keep things straight across the board for everyone. But you never know until you ask. 

Q: What is the length of most rental management agreements? 

A: This can vary from 1 to 3 years. 

Protecting Your Property

Peace of mind is important when you're allowing others to stay in your cabin. There are inherent risks that unfortunatelly can't be avoided. Make sure to work with your Management Company to have a plan on how best to protect your investment.

Q:  Do I have to carry a certain dollar amount of homeowner insurance? 

A: Individual management companies may have certain limits they require, definitely ask when discussing your agreement terms. 

Q: Are security checks done routinely on my property? 

A: Most companies do perform routine checks on the properties, especially during the winter months, after storms and after each guest leaves. 

Q: Does the management company take care of scheduling all the maintenance on my property? 

A: Yes, it’s their responsibility to maintain your property for repairs. Some owners will add to their agreement that any repairs over a certain amount must be approved first.  

Q: If I have a hot tub, will it be drained and cleaned after each guest’s departure? 

A: Yes, all management companies should be performing this task diligently. 

Q: If damage occurs in my property how am I compensated? 

A: Most companies will charge the offending guest and replace or repair the item or items. Ask what the individual companies’ procedures are. 

Miscellaneous Questions

Q: Can I stay in my property? 

A: Yes, but it’s usually limited to the off season, and only a certain percentage annually. The management companies’ goal is the rent your property for you, so get clarification from the management company. 

Q: If I stay in my own property am I charged any fees? 

A: Everyone is charged a cleaning fee upon departure. 

Q: Can I clean my house before departure and avoid the cleaning fee? 

A: Most companies prefer having a cleaning crew perform those duties so everything is ready for the next arrival. 

Q: Can my family or friends stay for free or discounted rate? 

A: This is a question that varies widely with each management company and is definitely something you would need to have clarified up front. 

Q: My property has a wood burning fireplace. Does the management company provide wood for the guest? 

A: Most companies do not provide firewood, but direct the guests to local areas to purchase it themselves. Check with your management company to find out their preference. 

Q: Do I have to supply my own bed, bath and kitchen linens? 

A: Some companies require you to use their bed and bath linens while others will allow you to provide your own. The individual companies will usually have their requirements in their management agreements. 

Any Other Questions?

We hope this list has helped you out. If you have any other questions or you'd like some help picking a cabin management company, feel free to reach out to us, and we'll do our best to help answer any questions and find you a company that can suit your needs.

And finally, the most important advice we can give: be sure to consult with an attorney prior to signing any agreements!


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