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I am a regular lurker here, but haven’t posted much. After reading all the complaints about dealing with Air BnB, I wanted to post about our experience using a management company to deal with the rental platforms. We bought a short term rental unit on Chincoteague Island three years ago. It’s about 3 hours from our home. We purchased it to avoid paying capital gains after selling another rental unit out of state when we moved. Our hope is to have this new unit nearly paid for when we retire and then live there during low season and rent it during high season and use the income to possibly rent overseas for 4-5 months/year. We debated and researched the best way to manage it being too far away to do it ourselves. The first company we used did a terrible job both on managing pricing and making sure the unit kept in good condition. Our current company is fantastic. They have promoted the heck out of our unit and it is now rented 100% from June-September. We’ve already exceeded last year’s NET by over $10k and we’re not even seeing the fall and holiday reservations yet (those tend to be made within 30 days of arrival).
The company has us on multiple platforms including Air BnB and VRBO. They require all guests to purchase rental insurance. They have no problem with locking out guests who violate rules (like partiers, underage renters or excess/undeclared guests). They take care of making sure that items that are stolen or damaged are replaced. They are also great on making sure that the cleaning folks are doing their jobs and that our place always looks great. They also keep a list of guests (thankfully only 3 names) of guests who are not welcome to return. They also do an analysis every year and reprice each week for maximum occupancy and income.
I know this may not be an option for every owner, but if you are considering getting into the STR market as an investment and want to avoid dealing directly with difficult guests or Air BnB, it’s a great solution . We check the unit every couple of months and the management company knows we are picky owners. We pay a 7% fee which has been absolutely worth every cent. The increase in business over last year alone has been worth the fees.
If you are considering a management company, I would recommend reading not only owner reviews, but also reviews from guests. Ask what the company will do to advertise your property and what other services they offer to increase your income each year. Our agency meets with us each year to go over the numbers and discuss the rental goals for the next year. They also recommend what price we should charge for each week of the year.
That is fantastic. Thanks for contributing this information.
I took a look at your listing, nice place and I admire your retirement plan.
I only have one negative comment and it’s that all those capitalization errors drive me nuts. I don’t understand why and how that started. I wish I weren’t “one of those kind of people.” I don’t know if it’s the kind of thing that would keep me from renting that listing but it really throws up a mental block for me.
The only thing that should be capitalized are the first words of sentences, proper names and “Family Dog.”
Thank you for sharing. I’m glad it has worked well for you. I think your future plan of renting while you travel is a fun one.
I considered using a management company but the 3 companies I investigated wanted 25%-35% fees. I couldn’t make the numbers work.
Added later: in my snooping of the new listings in my neighborhood today, a 4/15/21 new listing with a property management group is asking 170% of my nightly rate & is already booked to 11/1 with only a few open dates!!! Maybe I could make the numbers work….
I was wrong, we pay 16%, not 7%. I apologize for the mistake. Even at 16%, it’s worth every penny. The 7% was what we paid for long term rental mgmt in NC. My bad. My husband deals with the money stuff. But, If you are thinking of changing, I highly recommend Lance and Elaine at Seaside. We used CRV previously (if you are in the area, you know who I’m referring to) and were really unhappy. We switched to Seaside two years ago and we cannot say enough great things about them. If you look at the bookings on our unit, we have the last weekend in October blocked for our use. Everything else is paying customers. Ladt year we booked probably 80-90% of September, 60% of October and a week at Thanksgiving and a week at Christmas plus other various weekends in Nov and Dec.