How to Manage Successful Vacation Rental Investment Properties

Managing vacation rental investment properties, a key aspect of real estate investing, is by far not the easiest thing in the world for real estate investors. But it can certainly be made simpler by making a few small changes to your management process, especially when dealing with your first rental property.

As a dynamic pricing engine and revenue management tool, we’re in the business of optimization, aimed at enhancing the rental income potential of your rental properties. We’ve got you covered on ways to make your management process, whether as a property manager or a direct investor, easier than it has ever been!

Let’s start at the beginning. You, as a real estate investor, identify a profitable market for your real estate investments, check the property tax consideration, which are crucial in managing property taxes and understanding the impact on your property value. Then, you choose a property, perhaps considering an investment property loan if it’s not a primary residence, and then you get down to the nitty-gritty of how to run it effectively.

We’ve developed what we call the ‘Smart Way‘ to handle the investment process behind an Airbnb investment property. This approach is particularly beneficial for those venturing into their first rental property or looking to expand their portfolio in the real estate market. The previously mentioned post focuses more on starting your business in vacation rental investment properties, a subset of real estate investments. This post focuses on how to effectively manage them and keep them profitable. This is the ultimate goal for real estate investors. We’ll look at technologies you can use, things you need to do, and ways to make money in the off-season, ensuring a steady stream of rental income year-round.

Here’s how to successfully manage vacation rental investment properties…

Step One: Keep That Listing Updated

Going through your account setup is not a one-time process. An updated listing is a prioritized listing. Airbnb likes new listings, it likes listings that are kept updated and fresh. Regularly updating your vacation rental investment properties is crucial for staying visible and appealing in Airbnb search results, and it’s a smart strategy in real estate investing.

By ‘updated’, we mean more than just aesthetics; it’s about keeping your information current and attractive to potential renters. This includes updating your property’s description to reflect recent improvements or highlighting unique features that distinguish your rental property from others. Consider collaborating with a local real estate agent to gain insights on market trends. Also, ensure your listing aligns with what travelers seek. Frequent updates, ideally monthly, not only maintain interest but may also boost your annual rental income by attracting more guests.

Step Two: Build a Trustworthy Team

The value of a reliable team in property management cannot be overstated, especially when managing an investment property. This team should include skilled cleaners, efficient plumbers, and knowledgeable electricians, all essential for maintaining the high standards expected in commercial real estate and rental properties.

Establishing a rapport with a property management company or other real estate investors can also provide a support network, offering advice and solutions based on shared experiences. Even if you are a hands-on property manager, having a list of reliable contacts is indispensable. This becomes particularly crucial during guest stays, ensuring any issues are promptly addressed. Thus maintaining the integrity and reputation of your rental property.

Additionally, consider the benefits of partnering with a co-host, a service that companies like CohostMarket can facilitate, to enhance your property management strategy.

Step Three: Modernize Operations

Embracing technology is a cornerstone of modern real estate investment strategies. In our comprehensive list, we detail essential technologies for remote hosts to enhance their vacation rental investment properties. This includes the adoption of apps, self-check-in technologies, smart locks, and advanced property management systems.

The integration of these technologies is not just a convenience; it’s a necessity in today’s competitive real estate market. They streamline operations, improve guest experiences, and ultimately contribute to maximizing rental income. Airbnb automation is the way of the future.

Use as many optimization technologies as you can in the management of your vacation rental investment properties. Adopting these innovations can be particularly beneficial for those managing their first investment property, offering a solid foundation for successful property management and investment growth.

Step Four: Dynamic Pricing

If you want your short-term rental investment properties to succeed, then examine your pricing. You could have the perfect listing with the best service anywhere in the world, however, if your pricing strategy is not upgraded, you won’t reach your full earning potential. 

There are lots of dynamic pricing vendors on the market. All of them offer data-driven pricing recommendations, but none analyze more data than DPGO. Our smart pricing engine collects data every minute of every day, analyzes it, and pushes new, optimized prices to your listing every 24 hours. 

By basing your prices on market trends like booking surges, you’re giving yourself the best chance at winning more bookings. As we know, price is most often the determining factor for Airbnb guests, after they determine the location that they wish to visit.

Step Five: Offer Occasional Discounts

Offering discounts to make more money might sound like a misnomer. Trust us, you make more money in the end. Don’t discount your most popular nights. Instead, offer a less popular night at a reduced rate. This means you get an additional night booked when it was unlikely that night was going to be booked anyway. 

It depends on your pricing strategy but another great way to use discounts is to market your listing as a longer rental option in the off-season and offer a discount for stays longer than 28 days. The psychology behind discounts and how they are perceived by the consumer is complicated. However, the bottom line is, that people love spending less money than they expected to spend. 

We have an entire blog post dedicated to discounts and you can view it here.

How Can DPGO Help My Vacation Rental Investment Property Succeed?

Most hosts are forever on the lookout for the all-round short-term rental solution. It is necessary to make their lives that much easier and more manageable. Sadly, there isn’t one solution, one software, or one thing you can do to take your vacation rental investment properties from zero to hero. Not all software is created equal.

If you were to ask any successful short-term rental host, we’re willing to bet that a fair percentage would cite pricing as one of the most critical aspects of any successful vacation rental investment property. Instead of stumbling around in the dark with pricing, let data-driven insights determine them for you! We base our pricing recommendations on data that we are collecting every minute of every day. Our pricing engine detects the slightest change in demand, booking pace, competitor health score, available local listings, and more. This ensures that we give you the most informed pricing recommendations available anywhere on the market.

To start your free trial with DPGO, simply click the banner above and begin your journey to optimized pricing! Make 2022 your most profitable year ever and take your vacation rental investment properties to new heights with DPGO. If you have any questions, please feel free to contact us via the Support Chat on the homepage. One of our Success Managers will get back to you!