Hundreds of investors and second-home owners enter the Okanagan vacation rental industry every year. Running a second home or investment property like a business may seem like a daunting task for first-timers, however, armed with the right know-how, you can create a passive income stream that’s both scalable and lucrative. That’s why we’re sharing what we wish we knew when we were just getting our rental properties off the ground. Here, you’ll find our comprehensive list of strategic tips for first-time vacation rental owners to reduce stress levels while maximizing returns. A win-win right?!
Do Your Research
You’re off to a great start… because you’re here!
From developing a pricing strategy and figuring out which listing platforms are best, to stay in the know on provincial and local regulations, there’s a wealth of knowledge first-time vacation rental owners need to absorb to increase their chances of success.
When we first started in the business, there wasn’t as much information about vacation rentals readily available. We would read everything we could get our hands-on, and study other rentals in our area. We paved the way to our own profitability by doing our homework. We were committed to avoiding first-time mistakes by leveraging hospitality recommendations from experienced sources. We still made mistakes, but we kept our review streams solid through it all by pivoting to improve our hospitality and space to suit what our guests needed- 5-star service.
Luckily, owners no longer have to look as hard as we did. A simple Google search pulls up a ton of valuable info for first-timers. The Roam blog is a great place to start! Pour over reputable articles, be a sponge, and use this knowledge to empower your next steps for short-term rental success. Don’t have time? Contact us and we can assist you! *(shameless plug)
Leverage What You Have & Don’t Skimp Upfront
When you’re just getting started with an STR, it’s tempting to cut corners in an effort to maximize your returns. Once you’ve done your homework, you should have a better idea about what you need to compete in your market. Leveraging what you have with what upgrades you need, is essential.
Cutting corners often takes two common forms:
- Doing everything yourself so you reap 100% of the profits (which, if you take this route, will be lower in the long run due to time constraints and the resulting inability to grow your portfolio).
- Skipping household upgrades and staging instead of investing in a refresh before guests lay eyes on your rental property.
Frugality might seem like a responsible driving principle, but it more often than not forces owners to work tirelessly to generate rental income results. Ultimately, investing in your vacation rental upfront and releasing the reins of absolute control, means a simpler path to success—and more money in your pocket in the long term.
You might be thinking, “Okay. I’m on board. But what exactly will that entail?” Here’s the short of it: upgrade your vacation rental with simple luxuries and onboard services that can take your business venture to the next level. Our next two tips will help you navigate these recommendations in more detail.
Welcome Guests with Simple Luxury to Suit a Variety of Tastes
When decorating your vacation rental, it’s important to create a comfortable and convenient space for any guest to enjoy. To achieve this goal, start with a base canvas of classic, crisp lines and color palettes. Exercise design discretion and prioritize neutrality to appeal to a wide array of tastes. For example: skip the cheap colored linens, themed heavy comforters, and the mountain of worn throw pillows. Go straight to commercial white linens with extra pillowcases and the triple sheet method of making the bed. Don’t use overly bold colors on walls. Instead, add more color with wall art and accents (as these can be changed out much easier when trends shift).
Similarly, make an investment in new, high-quality furniture. The scuffed living room set you’ve had for years might be perfectly comfortable for you and your family, but it looks like a low effort to guests. For long-lasting durable furniture, source commercial grade. Sites such as Wayfair and furniture retailers can assist you with this. Commercial grade furniture is built to stand higher wear and tear than your average set. Roam has access to industry pricing on commercial grade furniture should you need help! Make sure to furnish for comfort as well as to accommodate the number of guests you intend to host. A four-person table isn’t very useful in a vacation rental that hosts groups of 6 or more.
And while choosing furniture and unbusy prints are sure to suit a variety of design tastes, remember, guests have also selected their vacation destinations intentionally. Incorporate subtle accents that evoke the feel of the area to position your vacation rental as an idyllic extension of the destination. Ski condos outfitted with mountain touches and beach houses with coastal decorations tend to get more bookings than those with no nod to the charm of the locale.
The final step in capturing understated luxury? Keep each room well-stocked with simple amenities. Offer spices in the pantry, toiletries in every bathroom, and throw blankets in living spaces. Your guests should have the comforts of home at their fingertips for that kick-back-and-relax feel. It’s amazing how much of a difference the right amenities and local decor can make to your reviews. Want to take it a step further? Add little touches to accommodate specific guest needs, such as local craft beer in the fridge for a corporate men’s getaway, or upscale champagne for that wedding party. The opportunities to please a group are endless, and building positive reviews is key to maximizing bookings.
Last but not least, use a professional real estate photographer to take listing photos, and instruct them to skip the expanding wide-angle shots. These can make a property look much bigger than it really is, and disappointment is not the first feeling you want your guests to experience when arriving. Ensure your property never overpromises and under delivers (it’s always better the other way around).
Let The Pro’s Handle the Brass Tacks
While running your own vacation rental is a great endeavor to take on if you are passionate about it, love hosting, and you’re up for the task of learning the ropes (possibly making costly mistakes along the way), it’s not for everyone. Attempting to own every aspect of their vacation rental endeavor can be stressful and lead many investors to abandon the business altogether. If you’re part of the latter group, recruiting a short-term rental management company to assist you is a great choice! If the cost is an issue, crunching some numbers may sway you otherwise. You’d be surprised how the hours of work you put in add up, and many find a management firm is comparable. Revenue can also be maximized when a firm is handling your pricing strategy, and often results in higher ROI. And the best part? It frees you up to spend more time growing your investment portfolio.
By outsourcing rental marketing and management, you can achieve polished professionalism right out of the gate — and avoid setbacks that often accompany inexperience. After hiring a vacation rental management service to help, homeowners often realize that their revenue results can significantly outweigh the rental income they’d give up in the process. Imagine seeing a return on investment faster, while doing a lot less work!
Price your home for year-round success
All too often, vacation rental owners make mistakes when establishing daily rates for guests. Some apply a flat rate to an entire calendar year, only to find their listings struggling when peak season ends and competition dwindles. Others price too high year-round, and consistently lose out to cheaper rentals nearby. For owners who come out of the gate with the lowest prices on the market, occupancy soars—but when returns are tallied, they’ve ultimately undercut themselves and lost out on revenue opportunities.
There are a number of pricing strategies worth considering when you’re first starting out in vacation rentals. The key across every option is to pay attention to market data, seasonal fluctuation, and your direct competition. Be sure to measure your home against others with equivalent amenities and conveniences. And stay away from applying personal value to certain luxuries. Just because you would pay $100 extra per night for a 3-car garage doesn’t mean your guests will see it that way.
Bottom line: a dynamic pricing strategy is crucial for achieving solid net occupancy and making top dollar on every booking. At Roam, we leverage technology. Our algorithms analyze billions of ever-changing data points. We track overall demand, seasonality, similar properties, and current trends. This helps us outperform the competition, earning more for our clients, compared to those using traditional pricing methods.
We hope these tips help you on your way to building a successful vacation rental business! With the right resources and strategies under your belt, you can leave mistakes at the door—and join the ranks of the Okanagan’s high-performing vacation rental owners.
Interested in learning more? Roam’s fresh approach to vacation rental management gives you total marketing, booking, and guest service. Our network is made up of trusted cleaning, property maintenance, and support partners to ensure professionalism at all times. We leverage technology-based solutions to ensure your listing performs, guests have everything they need, and bookings are maximized. It’s our job to drive more guests to your property for maximum income while providing an incredible guest experience, and we would love to help you! Feel free to contact us below!