With the rise of platforms like Airbnb, VRBO, and HomeAway, short-term rentals have become an increasingly popular way to generate income from residential properties. However, managing a short-term rental can be time-consuming and stressful, which is why many property owners turn to professional property management services. But not all property management styles are created equal, and choosing the right management style for your short-term rental can make a big difference in your success as a host. In this blog post, we’ll compare different property management styles for short-term rentals and help you choose the best one for your needs.
Self-management
Self-management is the simplest and most cost-effective property management style for short-term rentals. As a self-managed host, you would be responsible for all aspects of managing your rental, from marketing and booking to cleaning and maintenance. While this may seem like a daunting task, self-management offers some advantages. You have complete control over your rental, and you can interact directly with guests to build relationships and ensure a positive guest experience. Additionally, you keep 100% of the rental income, which can be a significant advantage.
However, self-management also has its drawbacks. It can be time-consuming, especially if you have multiple properties or a high volume of bookings. You may also need to invest in additional resources, such as cleaning supplies, linens, and decor. Finally, you will be responsible for handling any issues that arise, such as guest complaints, maintenance emergencies, or legal disputes.
Traditional property management
Traditional property management is a popular option for short-term rentals, especially for hosts who have multiple properties or live far away from their rental properties. With traditional property management, you would hire a professional property management company to handle all aspects of managing your rental, including marketing, booking, cleaning, maintenance, and guest communication. The property management company typically charges a percentage of the rental income as their fee.
The main advantage of traditional property management is that it relieves you of the day-to-day responsibilities of managing your rental. You can focus on other aspects of your life or business, knowing that your rental is in good hands. Additionally, property management companies have access to professional resources and expertise that can improve your rental’s performance and profitability.
However, traditional property management also has its drawbacks. You will have less control over your rental and may have limited interaction with guests. Additionally, you will need to pay a significant fee to the property management company, which can eat into your rental income.
One of the biggest companies in the traditional property management space for short-term rentals is Vacasa. Vacasa is a full-service property management company that handles all aspects of managing a short-term rental, including marketing, booking, cleaning, maintenance, and guest communication. They have a team of local property managers who oversee each property and provide personalized support to both guests and hosts. Vacasa is a popular choice for hosts who own multiple properties and want a hands-off approach to managing their rentals.
Another big player in the traditional property management space is TurnKey Vacation Rentals. TurnKey offers a full suite of property management services, including marketing, booking, cleaning, maintenance, and guest communication. They also use technology to streamline the guest experience, such as providing digital check-in and keyless entry. TurnKey is known for their high standards of cleanliness and maintenance, which can help hosts achieve better reviews and higher occupancy rates. Vacasa bought Turnkey in 2021.
Local traditional property management firms
Local property management firms specialize in managing short-term rentals in a specific geographic area. They typically have a small team of local property managers who oversee each property and provide personalized support to both guests and hosts. Local firms may have better knowledge of the local market and be more familiar with local regulations and laws.
National traditional property management firms
National property management firms specialize in managing short-term rentals across multiple geographic areas. They typically have a larger team of property managers who oversee properties in various locations. National firms may have more resources and economies of scale, which can result in better pricing and higher-quality services.
One example of a national traditional property management firm is already mentioned Vacasa. Vacasa manages over 30,000 properties in over 30 countries, with a team of over 6,000 employees. Vacasa offers a full suite of property management services, including marketing, booking, cleaning, maintenance, and guest communication. They also have a proprietary technology platform that helps them optimize pricing, occupancy, and revenue for their hosts.
In conclusion, the choice between local and national traditional property management firms depends on a host’s specific needs and preferences. Local firms may offer more personalized service and better knowledge of the local market, while national firms may offer more resources and economies of scale.
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Hybrid property management
Hybrid property management is a newer style of property management that combines elements of self-management and traditional property management. With hybrid property management, you would handle some aspects of managing your rental, such as guest communication and some maintenance tasks, while outsourcing other tasks, such as cleaning and marketing, to a professional property management company. Hybrid property management typically charges a lower fee than traditional property management.
The main advantage of hybrid property management is that it offers a balance between control and convenience. You can still interact with guests and maintain some level of control over your rental, while outsourcing time-consuming tasks to a professional property management company. Additionally, hybrid property management typically charges a lower fee than traditional property management, which can be a significant advantage.
However, hybrid property management also has its drawbacks. You will still need to invest time and resources into managing your rental, which can be challenging if you have other responsibilities. Additionally, you may need to coordinate with multiple service providers, such as cleaners and maintenance technicians, which can be time-consuming and stressful.
One of the biggest companies in the hybrid property management space is Guesty. Guesty offers a software platform that allows hosts to manage their short-term rentals more efficiently, while also providing access to a network of professional service providers, such as cleaners and maintenance technicians. Hosts can use the Guesty platform to manage bookings, communicate with guests, and automate tasks, such as scheduling cleanings. Guesty charges a percentage of the rental income as their fee.
Another example is Evolve. Hybrid property management companies like Evolve combine the technology and automation of self-management with the support and expertise of traditional property management. Evolve provides a range of services to help hosts manage their short-term rentals, including marketing, booking, cleaning, maintenance, and guest communication. However, unlike traditional property management companies, hosts retain control over certain aspects of their property, such as pricing and guest approval.
Evolve charges a flat fee per booking, which ranges from 10% to 15% depending on the services provided. This is significantly lower than the fees charged by traditional property management companies, which can range from 20% to 35%.
Evolve also provides hosts with a suite of tools and resources to help them manage their properties more effectively. Their proprietary technology platform helps hosts optimize pricing, occupancy, and revenue, while their team of local property managers provides support and advice on a range of issues.
Fees associated with different management models
The fees associated with different management models can vary widely, depending on the provider and services provided. Self-management typically involves the lowest fees, as hosts are responsible for managing their own properties and do not pay a third-party provider. Traditional property management and hybrid property management typically involve higher fees, as hosts pay a percentage of their rental income to the provider.
For example, traditional property management firms like iTrip and Vacasa typically charge a percentage of the rental income, which can range from 20% to 35%, depending on the location and services provided. Hybrid property management firms like Guesty and Evolve, charge around 10%, depending on the services provided.
Conclusion
In conclusion, choosing the right property management style for your short-term rental depends on your goals, preferences, and resources. Self-management offers complete control but can be time-consuming and challenging. Traditional property management relieves you of day-to-day responsibilities but can be expensive
