If you own a luxury vacation home and are thinking about hiring a vacation rental manager for the first time, how are you comparing them? Do you know what questions to ask to determine if they’re the best fit?
Here are five questions you can use to compare property managers and find the right one for you. Below we go into more detail about why each of these questions is so important, and follow up questions for you to ask.
1. What’s your retention rate?
Losing homes isn’t uncommon, but be sure to ask them why they lost those homes.
2. What percentage of your projections turn out to be accurate?
A majority of their homes hitting projections is a better indicator of success than a few homes exceeding them.
3. How do you plan to hit my rental projection?
Identify which company has the highest projection, then ask them what they'll do differently from the competition to hit that number.
4. What is the onboarding process like?
Some companies require heavy involvement from owners that can take as long as 6-8 weeks.
5. How much will I need to pay for maintenance?
Ask what home care costs will be over the next 6,12, and 24 months, so you know upfront.
The goal here is to learn how many homes the property manager has lost due to service issues. Property managers can part ways with homeowners for any number of forgivable reasons, but if they have a track record of losing homeowners to bad service, repeated mistakes, deception, or anything related to these, avoid them.
Important note: Property managers most likely won’t outright admit this, but if they can’t answer the question clearly and in a straightforward way, that should be your red flag.
While shopping around you’ll probably be shown stellar case studies of homes that exceeded their rental projections by a staggering amount.
What’s more important is to ask about the consistency with which they hit their projections, which gives insight into how experienced they are in setting nightly rates within the community.
Something else to consider about projections: How much do they differ between companies? If several companies are giving you projections within $15K-$20K of each other, then it’s more important to go with the property manager with a better track record of long-term care, for both you and the home, than the higher projection.
As you’re shopping for a property manager, keep track of the fluctuation in rental revenue projections you receive from different companies. Identify who offers the highest revenue projection, and ask them pointedly how they’re going to get that much more than all the others. If they don’t say anything unique from the others you’re speaking to, there’s little guarantee they can hit that projection.
With this question you want to gauge a few things:
We’ve noticed that before signing up with a vacation rental manager, a homeowner's biggest concern tends to be rental revenue. However, the moment they sign, that concern shifts toward how much annual maintenance will cost due to wear and tear, preventative maintenance, and adding amenities to stay competitive. Ask what you'll need to pay over the next 6, 12, and 24 months for home care. A good property manager will have this information, and it’s better to know upfront the costs of running a vacation rental than to be surprised by them later on.
What to expect: We’ve found homeowners should plan to spend between 1% and 5% of their annual revenue on preventative maintenance and home improvements over time, which can result in higher nightly rates and better long-term care for the home.
In just five questions, you can get a good sense of how your property manager will treat you and your home, maximize your rental revenue, and preserve your home’s value for decades of both use and rental income. Want to see how InvitedHome handles these questions? Get in touch with us by calling 970-289-4833 or filling out the form below.