Whenever we start to work with any new owner we start the conversation to define the relationship at a basic level. As a property owner who wants to rent their property for profit, you are essentially getting into the hotel business. Yes, we know that your vacation home is not a hotel, but you have the same obligations and risks of any real hotel property. Being an owner of a hotel comes with some basic responsibilities and also risk acceptances.
As the owner of your hotel you are responsible for delivering a hotel that works and has comfortable amenities for guests to use and enjoy. Hotels which fall apart on guests obviously create a poor experience and so it is critical that you maintain your hotel to make sure that all of the systems work, that it is maintained and that it has the supplies necessary for the guests to use. Do you have a propane barbeque? The tank needs to be full. Do you have a hot tub? That tub needs to work well and be clean. Do you have a wood burning fireplace? There needs to be soft and hardwood available in the garage.
As a vacation rental management company our job is to make sure your hotel has these items but they are still costs that are born by the hotel owner. We market your hotel, stock it, take care of the transaction, do pre-arrival checks, get guests in and out of the property, co-ordinate the departure cleans and remit tax. If your hotel isn’t working and guests complain, we handle those complaints immediately but that will result in maintenance charges as well as credits to the guest on your statement. Investing money to keep your hotel working is critical to success and while it is money out of your pocket it translates into fewer guest credits, more positive reviews and repeat guests. A repeat guest means another $1K in your pocket. If your hotel is working well, that means fewer guest credits, more repeat revenue and better listing quality with positive guest reviews. For success it’s critical that you re-invest into your hotel.
Just like the Hotel business, owners must accept there is an increased level of risk. You are renting out your home to strangers who have booked your property online without even speaking with you. Per California and Federal Law you cannot discriminate in who you can and cannot rent to. If your property isn’t dog friendly and a guest has a valid service animal, guess what, you must allow the guest and their service animal to stay at your property. We go through great lengths to educate all of our owners of the various risks that come with vacation renting their property; everything from the simple wear and tear to the accidental damage that occurs, to the occasional party that will happen, as well as missing little items. This are risks and costs that hotel owners must bear. The most serious risks that are least likely to happen is risk of liability and for catastrophic damage. While these risks are very low, they are still there and you need to be protected with adequate insurance coverage.
Welcome to the Hotel Business! The rewards are more money and profit, but just like every other business there are obligations, expenses and increased risk.