Have you ever dealt with a difficult or shady property management company while running an Airbnb or Vrbo, or perhaps you are newer to the industry and learning how to operate a successful airbnb or vrbo for the first time.
Set Clear Boundaries & Goals from the Get-go
If you choose to take a hands off approach, then you will have to rely on a good property manager to deal with the day to day operations at your short term rental.
If you plan on being a long distance owner, you will have to place your trust in their ability to execute on your goals of being cash flow positive. Setting clear goals and boundaries is important when dealing with your property manager.
You don’t want to come across as a “push over” while also making sure you are assertive enough while balancing being friendly and approachable with your property manager. If you discourage communication or come off unfriendly, property managers may become apprehensive about bringing up necessary maintenance items to you. Being too much of a “push over” and then property managers may realize that they can take advantage of you in different ways (overcharging you for house calls, adding extraneous items to your monthly expenses bill, or in worse cases cooking the books or making fictional expenses out of no where.)
A short term vacation rental on Airbnb or VRBO is really like running your own business, and you must treat it as such. Larger homes can also be like mini-hotels, in the sense that you will be in charge of managing your property the way you would run a hotel business in terms of logistics, handling staff and of course maintenance plus much more.
Setting expectations at the beginning, how often you expect your property manager to communicate with you, what issues must be approved by you (a set dollar amount for a broken pool heater >$1000 for example), or even certain financial goals for the year
Do You Want A la Carte or Full Hands Off?
Not all property managers are built the same, some property management companies offer full service, meaning that they provide everything from handling bookings, to communicating with guests and all the logistics of cleaning and hiring maintenance staff to handle your property. Typically, these services will set you back about 30% of your gross profits per year, so you must account for these fees
A full service property management company will handle everything including the finances and revenue associated with the bookings, so you must be able to trust them with your bookings.
Other owners prefer to take on a more active “a la carte” role meaning they may designate only certain tasks to their property managers such as outsourcing the cleaning staff, certain maintenance items or whichever items the owner doesn’t want to do.
Unless you want to handle 100% of the management, it is very difficult to do so unless you live in close proximity to your short term vacation rental and have experience dealing with maintenance issues as well as a network of contractors and handymen. If you are handy yourself that helps a lot and can save yourself a ton of money on emergency service calls that would otherwise run you hundreds of dollars for that 2am service call (from a guest that clogged the toilet from throwing too many toilet papers in.)
Clear Communications, Contracts and Paperwork
In running with my previous point above, you must treat your short term rental like a business and not a side hustle. Having clear communications, expectations and legal documents and paperwork is key to minimize misunderstandings while running your short term vacation rental.
There should be a clear management contract drafted up from the very beginning detailing the terms of the agreement, the fees, stipulations and responsibilities and most importantly, the exit clause in case you need to back out of the contract.
Things like under what terms the property manager must do, and what things they need to contact you for are super key. Also, specific examples of when they need permission to contact you for certain things are important.
Don’t Trust, Verify
For large repairs, it can be helpful to have your property manager provide you proof of paid invoices, photos of any damages or repairs needed, before & after etc.
A good relationship with your property manager takes time, and my old realtor told me “you want to make it seem like he’s a friend, while also keeping it business professional.” This serves to lower their guard down, allow them to exercise their independent judgement but also knowing their limitations so they can perform well for you.