Ten Mistakes Made When Renting out Vacation Properties
If you own a cabin and you plan on renting it out to vacationers, you might be a little freaked out by the amount of work it requires. Now, there are plenty of rental management companies out there that can help you, but if you want to do it yourself, there are things you need to know. It might seem a bit challenging, but there’s no mistaking the fact that you can make some serious bucks off your cabin – enough to cover the mortgage, and probably more. This article will cover some of the mistake people make when they’re trying to rent out their cabins for the first (or hundredth) time. If you’re renting out your cabin yourself, it might be time to take a step back and get an unbiased view of what you’re doing, and what you’re doing wrong. There’s no time like the present to fix those mistakes and start increasing your profit off this lucrative investment.
1. Not screening.
Traditionally, vacation homes are a hot spot for people looking to have a good time. Unfortunately, this also means it’s the perfect for those wild young kids (and sometimes some older ones too) who have decided that your place is the number one party place in town. First of all, you need to set up your restrictions for your cabin. This includes whether or not you want pets, smoking, or young kids. You can also decide how many guests you want in your cabin. After all, if it’s too crowded, there’s more of a chance of things getting dirty, broken, or just well-used. This also means you’ll need to screen your potential vacationers to make sure they meet the criteria you’ve come up with. This means you need to communicate with them! Don’t rely on email only. Make sure you actually talk to them on the phone. It’s a lot easier to lie over text than it is over the phone. Find out what they’re looking for in a vacation home, and decide whether your property is the right place for them, and they’re the right ones for you. If you’re new to renting out your place, you might get so excited by the idea of a renter that you don’t take time to actually screen them, and this can lead to sellers’ remorse when you find out they’re not the sort of guest you want in your home.
2. Listing with too many sites.
There are hundreds, maybe thousands, of listing sites on the Internet. They’re all trying to get your marketing budget, so it’s up to you to figure out where you want to post. There are many sites out there that will try and tempt you with a free listing. Now, there’s nothing inherently wrong with taking advantage of this, but think about it before you sign up with too many of them. You want to make sure you’re able to link back to your own website, first of all. Keep in mind that any time you want to change information (phone number, restrictions, rates, amenities, etch) that you’re going to have to go through each and every one of those sites and edit. This can be time consuming and very frustrating, especially if you miss one!
3. Believing that Craigslist and Kijiji are the Holy Grail.
It’s up for debate and definitely personal opinion on whether it’s worth it to post to these sites. Some people have had success using these sites, but other people have had only bad experiences. Remember that you need to be comfortable with the people who are renting your vacation home. Wouldn’t you rather know that they are looking at legitimate sites for vacation homes instead of browsing through the classifieds? A lot of people use Craigslist and Kijiji as a last-ditch effort to find the right spot. Maybe this is because they started looking too late and are down to the last minute, or maybe there’s another reason they’re not going through professional sites. Perhaps they’re searching for discounts or maybe their rental history isn’t too great, or their credit score is low, or they’ve got a problem with previous evictions. It’s a hit-or-miss game, and you don’t want to score the misses. Besides all of this, a lot of scam artists make their killing off sites like this.
4. Accepting a Booking Without a Rental Agreement.
It’s absolutely vital for both your sake and the sake of your renter that you get some kind of rental agreement in place before booking. You need to have written documentation about the length of time they’re renting for, the check-in/check-out times, the amount of guests who are allowed to stay in the vacation home, pet policies, and any other restrictions you might have decided you need. Having something in print will allow you the peace of mind you need to avoid misunderstandings. In case of a dispute, you’ll be able to refer back to the written agreement to make sure who is in the ‘right’. You can also save your ‘small print’ that can go in a Terms and Condition of Rental document that you can get signed alongside your written rental agreement.
5. Your Pricing is Off.
You need to take time to consider everything about your property before you decide how much to charge. You might have noticed that your neighbor is charging a lot for their rental and that your place is much nicer than theirs… but take time to truly evaluate what the competition has to offer. It could be that your neighbor is accepting everyone and has no problem getting money from a bunch of college kids looking to party who don’t mind the extra cost that’s being slapped on to cover any damage they might do. You might be alright with this for your property… or you might want to limit your cabin to someone who is going to respect your place and the things inside it. Before setting your price, take a look at the agencies you’re booking through and see what the other cabin owners are offering and compare this to the cost of their cabin. Maybe they allow pets and you don’t. Maybe you have motorcycle accessibility and they don’t. It’s very important to compare amenities to cost. On the flip-side, make sure that you’re charging enough. If you’re charging something that’s very low, you might end up with people who aren’t very interested in keeping your place nice because they’re not very worried about something that’s “cheap”. Keep in mind that you’re selling quality, and people are willing to pay for that.
6. Accepting the Very First Booking.
If you’re just starting off, it can be very exhilarating when you finally get a hit and someone starts inquiring about your place. Of course, it’s important to remember that you don’t have to take the first person who comes along. You have time to look through potential renters and decide who you really want. It’s easy to forget the fact that your cabin only easily sleeps seven and the renter is asking if they can have nine guests or that they have two dogs and you only want one pet. Set your occupancy level and your other restrictions and then stick by them! You set them that way for a reason, and you need to make sure they’re followed. You’ll be grateful in the long run that you decided to turn down that family of ten guests with three dogs and five kids when your cabin doesn’t end up with a huge mess and you don’t have to shell out the big bucks to make sure that it’s clean and ready for your next guests.
7. Ignoring your Instincts.
A lot of people are so thrilled to get an inquiry that they will let anyone skate by. But sometimes, it just isn’t a good fit. If the phone call seems a bit off, it’s important to analyze why. Perhaps they mentioned something that makes you just a little uncomfortable, or they forget to tell you how many children they have until you’re on the phone with the, and then it’s suddenly three young kids instead of one teenager. There are little things you can look out for. An example would be someone asking how many cars can be parked in the drive way. This might be completely innocent. They could just be a small family that’s going to driving up at different times. On the other hand, it could be that they’re planning a family reunion and just conveniently forgot to mention that to you. If something just doesn’t feel right, you are under no obligation to make that booking. Pass it by and wait for one that feels right.
8. Asking for Payment When they Arrive.
If you’re not charging a deposit and are only asking for payment when your guests arrive, you might be making a huge mistake. You have no certainty that they’ll show up. This can be a real hassle and can completely undermine your ability to make sure you’re renting out to enough people to make the profit that you’re looking for. Also keep in mind that if you wait for them to arrive, they could pay with a check – a check that may not even clear with the bank till after they leave! Remember. It’s easier to ask for payment upfront than in person, when they arrive. It can be difficult to turn back guests who conveniently forgot to bring cash and promise to have it by the end of their stay. Ask for 25% upon booking and ask for the rest with plenty of time for a check to clear. If it’s very last minute, ask for a money order that can be sent through expedited mail. Remember that this is absolute the standard in the industry. So if they don’t want to pay upfront, then you’re probably better off finding other renters anyway!
9. Sending Keys Through the Mail.
You might be tempted to send your keys through the mail. This was the standard way of getting them to guests after all. Times change, though, and with the new technology available, it just isn’t worth the security risk anymore. Remember what happens if they have your key: they can make copies, they can pass it among friends, they can forget to return it… by the end of renting season, you might have a dozen keys in circulation! Instead of giving out keys, why not just get a keyless entry system? Or you can use a lock box and change the code for each guest. This way, you can just change the code when they leave, and not have to worry about a thing! Forget about the keys. Codes are where it’s at these days.
10. Supplying Very Little to your Guests.
The secret to getting the most money out of your property is high ratings and return customers. This means that you have to get ahead of your competition. Now how do you do that? Amenities, amenities, amenities. If you supply the very bare bones for your guests, than your guests are going to give you the bare minimum when it comes to reviews and stars. They might complain while they’re there, or after they’ve left, and this can discourage future guests, and you can rest assured that they won’t be returning any time soon. Expectations have risen a lot in the last few years, and things that were once considered luxurious are now considered to be the standard. So you’re going to have to work a little to make sure that you’re now hitting the high points. You want to be on the cutting edge, not playing in the bargain bottom.
Remember. If you’re renting out your cabin, you’re going to have a unique experience with your own trials and tribulations. However, you can minimize some of those difficult things by avoiding the above mistakes and learning what to provide, what to discourage, and how to follow your own gut when it’s telling you whether or not you want to list with that sketchy agency or rent out to that guest who makes you feel uncomfortable.
Keep in mind, as well, that you are not obligated by any means to do this by yourself. There are a thousand articles out there that explain how to rent out your cabin yourself. You can make use of those, or you can rent out cabins using a property management company. It might cut into your profit a little, but if you’re having problems doing it alone, sometimes professional help might not be that bad. There are plenty of reasons to use a management company, so check them out sometime. Until then, remember: it’s your home. Find people who are going to treat it with the same respect that you do!