Property management Archives - Christies Gulf Beach Rentals

9 things to improve your vacation rental income now

Considering buying a house for a full-time short-term property? Think again. The market at the start of 2024 is not producing the income that many expected. If you are thinking of putting your existing vacation home on the short-term rental market, you may be rewarded. Vacation homes are always in demand somewhere. It’s time to consider how to improve your vacation rental income now. Take action while you can by reading our 9 things to do below.

Vacation rentals can work for you if you are prepared to cover the cost of the property and consider the extra income as just that, extra. There was a time not long ago with lower interest rates and lower housing costs when you could acquire a property and rent it for income alone.

Unless you pay cash for a property, don’t expect the short-term rental market to support your property at least in 2023. Yes, it’s true, there is high demand during the peak season but earning a good income for three or four months may not pay the bills. There are at least 9 things you can do to improve your vacation rental income now if you already own a vacation rental property.

Everyone is hoping the high season will help

Rental property managers are doing the best they can to rent owners’ properties but the demand has fallen off. Occupancy rates are much lower than they have been for the past few years. Everyone is hoping that the high season will deliver some great income and help offset miserable first-quarter income. The entire short-term rental industry is trying to determine what has happened to the guests. This is my take on the issue.

Many more properties have come to the market meaning more competition for the same or fewer guests. The number of guests has fallen off as well for two reasons. One is that the pent-up demand during COVID generated outsized income in 2020 and 2021. The second is that because everyone took their vacations and I do mean more than one for lots of people, they all vacationed out. Another key reason is of course the high inflation economy.

The ironic thing is that people who are desperate to make their mortgage payments have lowered their nightly rate to the point where they are in some cases going backward. This has caused a cascade effect on pricing in many markets where even the best properties with high ratings were forced to drop their prices.

The vacancy rate at the end of 2024 is high

The middle of 2024 and the vacancy rate has improved slightly as more vacation homes hit the for sale market. Revenue per night is roughly the same as 2023 but many people with little skills at property management have lowered their prices. A few may have more rentals but total income will probably not be higher than in 2023 without more bookings.

vacation rental property 2023 — Vacation Rental Property

Rentals were brisk this past Spring and going into the summer there are some good indicators. Gone for now are the longer two-week stays at most properties during the summer. Weekend stays and last minute bookings are the norm in 2024.

There was a rush to buy second homes during the past few years and while many thought they could sustain the costs of a second home, the economy changed their financial position. At this writing, I do not see a large number of vacation properties hitting the market. There have been a few in the last several months but not a rush.

Guests will pay about the same as 2023

As mentioned above, guests are paying about the same in 2024 as in 2023. Not raising rates is in effect a discount since inflation has hit vacation property owners hard with higher insurance costs.

The good news for some investment properties is that they are well-located for long-term rentals. Renting to individuals for a longer term e.g. six months to one year can improve revenue streams and help cover costs.

Not all vacation properties are suitable for full-time rental and some are not in areas where people want to rent full-time. Speaking for the Mississippi Gulf Coast, there is a shortage of full-time rentals so converting some will help both the owners and renters.

Hosts are looking for visiting nurses

Our rental management company handles both long and short-term rentals. This means we can rent on a shorter-term basis for one month, six months, or longer. Many short-term rental hosts attempt to attract traveling nurses and other business travelers who stay longer. That’s a good idea however most short-term rental listings already cater to people who stay for multiple weeks and months.

These economic headwinds require significant research about how to attract other than vacationers. This is the right time to determine what you want to do with an existing property, rent on a long-term basis or sell it.

Everyone wants to rent to visiting nurses

Why sell your vacation rental now? New hosts may believe they can do better. The summer travel demand may entice buyers to pay what you are asking for a fully furnished property. Higher interest rates have slowed down the acquisition process but rates have been coming back down slowly.

Home prices are softening which is making potential buyers look again. If you purchased your property a few years ago, you probably have sufficient equity to sell at the market and walk away with a nice income.

Long-term rental rates are still rising

For the rental business owner who wants to retain the property and rent it on a long-term basis, good news. Rental rates in many markets are still going up. They are on the Mississippi Gulf Coast. Rates are beginning to reflect higher operating costs and where once a three-bedroom house would rent for $1,200 per month in this market, they are now going for $2,000 and more per month.

Short-term rentals are in an oversupply situation now which will keep rental rates lower than they should be and reduce income earned by individuals.

To wrap up my discussion about the travel industry, it’s important to note that from what I have been reading, many Airbnb hosts are experiencing the same slowdown. The supply growth may be fueling higher income for Airbnb but it’s killing lots of mom-and-pop hosts. I believe that the supply growth will slow in 2024. Some vacation homes are already being offered for sale fully furnished. This trend should increase through 2024.

We thought that mortgage rates would fall under 6% in 2024, but that has not happened. This has helped keep the supply of short-term rentals from growing. With higher insurance rates plus higher financing rates and too much competition, many potential investors are looking elsewhere.

The housing inventory in 2024 is higher on the Mississippi Gulf Coast than it was in 2023. Part of that inventory are vacation homes being sold fully furnished.

9 things to improve your short-term rental income

Ok, it’s time to get more into what you can do now to improve your situation. I am offering these suggestions, some will apply to you and some will not. You may or may not be in a position to take advantage of one or more.

Property management

Find a property manager. If you have been managing a property from a long distance, it’s time to hire a manager. Why? several reasons but the most important when there are fewer guest bookings is to be sure your property is cared for. Particularly in remote locations, your property may be fair game for those who may want what you have. Someone should be responsible for driving by and periodically checking on the property.

When there is a steady flow of guests security may not be as important an issue. In cities such as San Francisco crime is on the rise and you need to be sure your property is secure.

Another reason to hire a property manager is that they do not charge by the hour, week, day, etc. They earn when you earn. They are still responsible for your property when there are no guests there. During the winter, pipes can break, and AC systems can go down during warmer periods. Stuff happens and having someone there to look at your property is essential. Not to mention that a good property manager has a website that adds some depth to marketing your property.

The Property Management website offers flexibility

Last year, our clients were able to benefit from our current offerings. Christies website does not get the traffic that the third-party sites get but we get direct bookings from past guests. Having our website gives us some flexibility with prices and guest offerings.

A good example is that during the winter we offer firewood for a fee to be used in the firepit. Without going into more detail on this topic, there are many more reasons to use a property manager when there are fewer listings and when there is market demand for your property as well.

Chrisies also markets to groups including nurses but those snowbirds are important, particularly in the winter.

Property managers understand the local market and the average daily rates that your property can get even in this challenging market. The basic business model for short-term rentals is much better understood by a professional staff. There is a fee for property management and that should be calculated as part of your cost of doing business. How much better will you do with a partner who operates a successful vacation rental business? Perhaps they can help you earn additional income.

Facebook/Twitter- Social Media

Use your own Facebook and Twitter accounts to promote your property. Go to your property manager’s website and grab a link to your property. Paste that link into your Facebook and Twitter accounts. Tell your friends what a great place your property is and why they should stay there. Work out a plan with your property manager to give a discount to Twitter and Facebook referrals. This is a good business strategy to help push your property out there.

Don’t stop with a one-time listing, create a plan to push your property out on social media at least once each month in the slow season. Social media is one of the best places where people go to learn about properties that are referred to by others. As people create their travel plans for the year, your property should pop up.

Improve your property

The best way to ensure your property rents for the maximum is to be sure that it is well maintained. It must be inviting. Read past comments from guests to help improve your property. During this slow time, your property manager should be making deferred repairs e.g. replacing the water heater. It’s difficult to make repairs during the busy season so get it done now.

Lower labor rates are typically available in the winter and spring. Contractors who have been working with vacation rental property owners and managers need work now, their business is slow. It’s time to negotiate a better rate for those repairs.

Take a good look at your furnishings and linens. Can you improve them? It may seem silly to spend money when you are not earning it but you must consider that your investment now will reap rewards next year. Domestic travel in 2023 is expected to improve so be ready.

New photos, new listing

Perhaps it’s time to have new photos taken. Rearrange your furniture, and capture all of the new things you have done to the property e.g. new flooring, paint, art, etc. Our professional photographer charges less than $100 for a full house of excellent photos.

Spend the money to get the best lighting and angles for your property. Rewrite your listing. Think about what people want today, not yesterday. Focus on the improvements. If a potential guest has seen your property in the past and gone everywhere, your facelift may catch their attention the next time.

Accept Pets

Consider allowing small pets with rules and large fees and deposits. Airbnb is trying to accommodate people with pets and they are pushing hosts to permit them. Not only can adding pets improve your rental income but the rental pool will increase for your property. If you have a high-end property you may not want pets. Some properties are not viable for pets but others with yards can be accomodating. If you decide you may want to permit pets, do the following:

* Pet fee of $xxx, non-refundable. * Pet deposit of $xxx which is refundable. * Pet can not be larger than xx pounds and must be potty trained. * Pets can not be left unattended inside the building, they can be left in the yard as long as they do not bark. * Your fee to remove pet hair and deep clean is $xxx which will be deducted from the deposit and the balance will be due.

You can add more about pets if you want, the items above are important. We have had good and not-so-good experiences with pets. At this point, there have not been any that have urinated inside. Your pet policy can include full costs of replacing the carpet, flooring, repainting, etc. Airbnb has some protection for hosts but you may have to fight with them to get paid. ChristiesGulfCoastRentals.Com offers damage insurance for about $50 per stay which will cover up to $3,000 in damages.

Amenities

As with allowing pets, you may want to add amenities that are in demand but will not cost a lot. Add a fire pit, horseshoes, bag toss game, and other diversions. Provide a wagon for the beach. Consider providing a golf cart, boat, kayak, and other toys. You can purchase insurance to cover the liability for toys. Some amenities can earn more income, while others improve the experience. You can add more to the bathroom areas e.g. shampoo, soaps, etc.

Read through listings with five stars, and look through the comments. What makes that property stand out? Was it the black facecloth for removing make-up or was it the welcome basket with chips, cookies, etc.? It’s time to improve rental income through some things you can do differently.

Redesign your property

Perhaps your property sleeps four. The community would permit more or they have no requirements. Consider adding bunk beds to accommodate more people. Add a sofa sleeper in the living room. At this point, you can not accommodate five or six so you lose out on those larger parties.

ChristiesGulfBeachRentals.Com suggests accommodating up to 10 or more people depending on the area. Lots of family groups congregate at the beach and need space for multiple families. The more you can accommodate, the greater your opportunity to improve rental income and rent your property in a slow economy.

Consider this. You offer your property for $200 per night. Divide that by four and you arrive for $50 per night. List your property that accommodates 8 for $220 which comes to $27.50 per person. Which property is the best value? Not everyone is looking for value, major cities may attract couples for a weekend for example and they are not concerned about saving a few dollars. Other Urban markets may be similar in that they rent to fewer in a party.

More rural destinations, on the other hand, may cater to large parties such as ski resorts. Also, larger groups may ask for longer stays. This past year, most of ChristiesGulfBeachRentals.com properties were rented to large groups from 8 to 12. Total prices for these larger groups were comparable to properties permitting just four. Larger groups are more focused on price because they know how to do the math.

Rent for the long term

This option was mentioned above. Many properties can break even or earn a profit as full-time rentals and improve rental income. I suggest this to most people who are “stuck” with mortgage payments they can not afford, considering the long-term rental. Rental rates are up which can help improve your rental income. At least on the Mississippi Gulf Coast, rates are continuing to climb. To be fair, they have been under the market for a long time.

house for rent — rent rates are still going up

You may have looked at your financial situation before and determined that a full-time rental would not pay the bills. It’s time to look again. I just sold a property that I purchased three years ago. The rental rate for a duplex unit with four bedrooms went from $900 to $1,300 at that time. The same unit would probably go for $1,400 in a few months. I would call this type of market the kind that can help improve your rental income.

Lease to the short-term rental company

There is another possibility, you can potentially lease your property to a company that rents short-term properties. They will agree to pay you a fixed monthly lease payment and rent your property on their short-term platform. Some of these companies have a large returning guest list and along with the third-party sites may be able to keep your property occupied.

The lease would be very similar to leasing on a long-term basis. Your property would be maintained as if it were rented by your property management company. Some property management companies may also agree to lease the property from you on a long-term basis and rent it on a short-term basis. You may consider a lease-to-purchase contract with them as well.

Selling your short-term rental

The last thing you want is foreclosure. I am not suggesting anyone sell their property if they can afford to retain it. The short-term rental business is here to stay and it will turn around eventually. Don’t wait until the last minute to put your property on the market. Properties are taking longer to sell now. If you are at break even on your property meaning value to mortgage, talk with a real estate agent about options including renting.

Logan-Anderson Gulf Coastal Realtors specializes in working with investors. They often have clients waiting to buy properties that are suitable for short-term and long-term rentals. Perhaps there is a deal to be made if your property is located on the Mississippi Gulf Coast. If it is located elsewhere you can contact them and they can help you connect with an agent in your area.

The economy always rebounds

Don’t lose hope, the economy always rebounds. History and statistics indicate that with every slowdown or recession, there is always a recovery. Remember that there are opportunities in any economy. If you are sitting on cash, look for a good buy, they are available, and more will come along in future months.

If you must sell your vacation rental, so what? Reposition yourself to recover and buy another using all of your experience. Christies Gulf Beach Rentals will work with you to help improve rental income to promote your vacation rental and help you do your best to make it a top pick of guests. We can’t make people take vacations and we can’t cure the flu or colds but one thing is almost as certain as the sun rising, people will want to get away.

We understand what happened with COVID, the vacation rental business exploded. I believe that new demand is now building. Some can’t afford to take a vacation now but they will be better positioned later. If you can weather this downturn, you will come out the other side even stronger. If you can’t make it, don’t stress, check the options above. We will work as hard as possible to help improve rental income at your property but you need to help also.

Please visit our website at ChristiesGulfBeachRentals.com and check out our blog articles and our properties. If you are an owner click on the link above and tell us about yourself. Thank you for visiting Christie’s Gulf Beach Rentals.

William Anderson July 6, 2024July 6, 2024 Property management, Vacation Rentals

Dynamic pricing for short-term rentals: Is this the answer?

Dynamic pricing for short-term rentals is not effective everywhere. Contrary to all of the recent hype about these great computer programs (for a fee) that will help you make loads of money, they may not. Then why is everyone on this kick now or “hack”? Using a dynamic pricing tool will help those who have properties in big travel areas. It does not always work with vacation rentals. Before you spend any money or jump to the conclusion that your current short-term rental pricing tools are inadequate read further.

Dynamic pricing comes from searching booking sites

Dynamic pricing software simply searches Airbnb and VRBO website data to determine what is listed for rent, when, where, and for how much. It looks at a specific area that you are interested in and tells you what you should price your property at for a given day, weekend, week, etc. The theory is that if you adjust pricing frequently you can capture a greater level of profit and obtain more bookings. The concept is great for many areas but not all.

Take San Francisco, Washington D.C., Atlanta, or other large metro area. A large number of travelers during the year are people on business trips. I know I was one of those for decades. Most stays are during the week for what I call “travelers”. Now “travelers” are not the same as “vacationers”. Travelers are moving from one place to another mostly on weekdays. They can stay for a few days or a week depending upon the situation. Others can stay for a few weeks, months, etc.

Travelers vs Vacationers
Both use short-term rentals, areas with lots of travelers can be managed with dynamic pricing

45% of visitors to Atlanta are on business. 56% of travelers to Washington DC are on business while 22% of travelers to New York City are on business. Needless to say, there is a very large market for business travelers to use short-term rental properties.

Vacationers except for major holidays and the summer will stay for two or three-day weekends. Vacationers tend to visit areas that are considered tourist destinations such as beaches. The difference between the patterns of stays between travelers and vacationers is that travelers tend to focus their efforts around big cities and big metro areas that are also vacation areas. The tourist spots such as the beach, receive vacationers during set periods of the year.

Hotels use dynamic pricing for travelers

Using dynamic pricing as hotels do in big cities allows them to charge more when for example a convention is in town and less when it’s over. For this reason alone, using dynamic pricing in these areas is a good tool. Let me try to explain why it is not always an effective tool for earning higher rental income from vacationers.

During the low season, there is little you can do except to reduce the minimum stays from 5 to for example 3 as in a weekend or even two. The problem is that fewer people are visiting. You and everyone like you have the same idea so they all reduce the number of stays for example. The next thing the first-time owners will do is to reduce rental prices. The thinking is that lower prices will attract more people. It’s possible but if everyone does the same thing, where does that leave you? Chasing the prices down. Again, remember fewer people are coming to the area.

Short-Term Rentals vs Vacation Rentals
Both are the same in most cases. Most guests (57%) search for the word “vacation” vS SHORT-TERM

During these low periods which can stretch for months, dynamic pricing will not generate more revenue or higher occupancy. It’s just as easy to determine market rates by going to Airbnb and VRBO listings. You would want to do this anyway to assure yourself that it’s not just your property that is not renting. Of course, negative reviews can have an impact, actually, one that is far greater than using dynamic pricing software.

Use a local property manager

Your best move is to use a local property management company. Good local property management companies know their markets far better than any software located in San Francisco. Short-term rental hosts are good at pricing owners’ property to obtain the best result. Local short-term rental managers have been using the concept of dynamic pricing well before computers have been offering it. Their approach is hands-on.

They know the market, block by block, and understand that some areas are more desirable than others. Computers do not catch the fact that during the height of the season, even a shed will rent. During the critical periods of the year e.g. fall and winter, the better properties will rent more often.

Customer support and return guests are very important. People who have rented a property and like it will be more inclined to return without price shopping. Also, property managers are in a position to offer a last-minute deal when someone calls requesting a stay with one hour’s notice. How about a few examples of how this works:

Last week, a guest booked a stay at the property management website because Airbnb and VRBO cut them off, within one hour of arrival time. They booked on the website and called the property manager. They were fortunate that the property had been cleaned and moved in. In another example, a very large party moved into a property where there was a water leak.

The property manager was able to move the large party to two adjoining condos at another property immediately. If it were not for the quick work by the property manager the 7-day booking would have been lost.

How does a local property manager arrive at pricing?

A discounted rate can be offered by the property manager for returning guests or friends of owners for example. Let’s discuss how a local property manager arrives at a dynamic pricing solution. At Christie’s Gulf Beach Rentals, the managers look at the entire year calendar. They mark out beginning and ending dates for every holiday that brings in more people.

Every event that does the same and any other periods that should be priced higher such as June and July. Prices are adjusted according to the calendar using competitive data that is obtained from third-party platforms and from talking to other property owners.

While this system does not raise and lower rates from Monday through Thursday for example (unless it’s an event or holiday), it does consider all opportunities for higher revenue based on the volume of vacationers coming to the area. When it is busy the prices are higher and when it is not, prices are lower. Pretty simple. As I mentioned above, in big cities when travelers are coming in for events, etc., rates can be adjusted daily.

During the low seasons in tourist areas, raising and lowering prices during the week makes no sense. Often our clients will make price recommendations which more often result in lower revenue. Recently a client asked that we lower their prices because they were not getting what they thought was sufficient rentals. Christies did what they asked.

Prices were increased and they earned more per stay

There were a few short-term rentals during the period but at a lower price than other Christies properties were receiving. They concluded that they needed more revenue and the prices came up. The occupancy rate did not change. What did change was that they earned more money.

Higher prices can affect the number of sales during most of the year. Some clients want higher prices and fewer stays because the theory is by the end of the year the total income would be about the same without the additional wear and tear on their property.

Property management companies understand pricing dynamics and adjust them accordingly. You can play with prices only so much. The key to any successful vacation rental property is guest count and price hitting that sweet spot. In some areas, there are so few rentals during some seasons that reasonable prices should bring in as many guests as any of the competition.

Fewer bookings are a trend in 2023 and will be in 2024

Fewer bookings have been the trend because of the larger number of vacation rentals hitting the market since 2021. Lower prices in this environment are not the best way to increase revenue. Of course the average base rate is lower during the low season, you do not need expensive software to accomplish this.

A great way to entice more people to stay at your property if you are an owner is to help the property manager by advertising to everyone you know. Push your property on Facebook and other social media.

The short-term rental market is in transition. Market demand is about the same but with more properties available, short-term rentals become more of a commodity. Short-term rental properties must be ready for the peak season. You can help your property by having everything repaired and doing preventative maintenance during the off-season.

Short-term rental owners should stay at their properties during the off-season to be sure that everything is ready for the peak season when more extended stays are in high demand. I have had issues with my properties during the peak season e.g. AC and had to move high-paying guests losing the revenue.

Local property managers know their seasons

Your property manager knows how to manage the peak season, this is the one time when even the dynamic pricing is exceeded by “what the market will bear”. There is no need to run numbers during this season as virtually everything is booked in these vacation areas. Getting back to the benefits of dynamic pricing, they fall into the big metro areas on a year-round basis where catering to both vacationers and travelers is the focal point of their efforts.

Beach Biloxi Crowd — Vacation locations receive crowds at the same times of the year every year

Real estate investors must understand the idea of the best price and a competitive price as explained by their property managers. Many look at the high season as the savior where most of the income is earned. This may be true for some real estate investors but not for all. The high-season income is not as great as it has been in past years so using that income to cover gaps in the remainder of the year is no longer a good strategy for many property investors.

Research using the free Bard AI

If you decide that you want to do some research, use Google’s Bard, AI to inquire. I asked the following question of Bard:

”How many 2-bedroom short-term rentals are being offered for rent on Airbnb in Gulfport MS” The answer is as follows:

According to the Airbnb website, there are currently 394 2-bedroom short-term rentals being offered for rent in Gulfport, MS. This number is based on the search results as of August 5, 2023, at 11:31 AM PST.

The average nightly price for a 2-bedroom rental in Gulfport is $129. The most expensive 2 bedroom rental is listed for $212 per night, while the cheapest 2 bedroom rental is listed for $88 per night.

A Bard search also determined that the number of searches for vacation rentals in September 2023 vs. September 2022 was 6.25% higher. Searches for short-term rentals were 9.09% higher for the same period. By itself, this data will not affect a property manager’s decision on pricing short-term rentals but it’s a factor to take into consideration.

If you use an AI, learn to use it first

If you have time, you can continue to dig using various parameters. The data is the same that is used by all of the dynamic pricing software models. Some include VRBO but the trends will be about the same so I stick with Airbnb. There are other service providers but they usually take their data from Airbnb and VRBO. You can obtain market data and market trends from Bard too. Or, you can just talk with your property manager.

A word of caution about using an AI like Bard. The data provided can often be incorrect. As a property manager, I know this when I see it. Many would not. It’s very important to tell the AI Where you want to obtain the data. For example, it may find data at a website that grabbed some from Airbnb and others. Aggregated sites are not always accurate. learn how to use an Air before you rely on its results. Another good reason to ask your property manager.

Property managers use a variety of management systems that help them manage their businesses and short-term rentals. Most property managers that I talk to manage their short-term rental business by doing local research which includes not only data on the web but also speaking to Cities that issue licenses to properties. Sales tax revenue data is also available that can provide indications of the health of the local markets.

short-term rentals price break down — listing on Christies Gulf Beach Rentals Site

Summarize: Dynamic pricing is good for some but not everyone

To summarize, Dynamic pricing is good for large cities and metro areas where travelers and vacationers create an almost year-round market. There are many markets in North America where dynamic pricing will probably not improve profitability. Beach areas away from big cities, mountain areas, and others that have seasonal business don’t need dynamic pricing for the busy season. Nor do they need dynamic pricing for the slow season.

Local property managers fully understand the dynamics of their market including the availability of properties, pricing, and activities that affect pricing e.g. special events.

Visit ChristiesGulfBeachRentals.com and read some of our blog articles about vacation/short-term rental management. Our clients receive access to their client portal which has a wealth of information to help them understand the market and value of their investment.

If you are interested in purchasing a property for use as a short-term rental or vacation rental/second home, click and see what is available on the Mississippi Gulf Coast.

Please stay with us on your next trip to the Mississippi Gulf Coast. Check out our great properties and reserve on this site. Vacation travel insurance is included at no additional charge.

Good reasons NOT to hire tech based vacation property managers

Are you looking on the internet for a property manager for your vacation rental? Stop. Don’t hire an internet-only tech based property management company. Why? They are not local and hands on your property. A San Francisco or Denver-based person in a cubicle has no idea where your property is or what is going there. You need a local, professional, property management company. What to know why?

A new client called and said they were working with a Denver-based company when they learned from a neighbor that the police came to their new property. After the dust settled, the “guests” decided to have a large, loud party. People were parked on neighbors’ lawns and the noise kept on until the police arrived very late.

The owner learned from the cleaner that the property required not only heavy cleaning but many items were broken or damaged. The owner spent $3,000 on repairs.

The internet tech-based manager had no clue

The internet tech-based property manager located many states away in a different time zone had no idea. The police did not know who to call and as it happened, the internet company did not tell the property owner that a permit was required in the city. Fortunately, the permitting department was not informed of the disturbance by the police department. Of course, the Denver-based company had no representative on site to deal with the police.

Later that week the owner called us and we took over the management of the property. One of our tasks is to drive by the property periodically e.g. each week for a view of the outside. We visit during turnovers also.

This is just one example of many that have driven vacation owners to local property managers. We have obtained many clients from the San Francisco tech-based and other internet companies who were very displeased. I have participated on a number of forum sites where I hear the same complaint from others.

It seems that every month a new tech start up thinks they can manage property from a basement or high rise.
People require attention and the best guest experiences are gong to come from personalized attention. This means human beings making contact with guests on site.

New investors are looking for a low-priced manager

What I have found is that new investors are trying to save money in most cases so they look for rates first. Some will contact local property managers and decide to go with the internet people because it’s easy, they just open an app.

The idea of managing property from afar is interesting. Your investment rental properties are the most valuable assets you may have other than your own home. How can you trust it to someone who has never seen it? Really? Short-term rentals are real properties, they require maintenance and attention. Trying to rely on cleaners to inform you when something requires work is just not smart.

Do you think that the San Francisco people have actually met with the cleaners and inspected their work? No, of course not. A very valuable asset managed by people with no vested interest, who have never seen it. Excellent stewardship of valuable assets.

Local managers provide a sense of security

Rental owners should expect much more from those who are responsible for their property. Property management services offered at the location where the property is should provide a sense of security. Real estate investors should know better than to entrust their property to strangers. You may say, well guests are strangers, true. It’s not the same thing.

If during that one day in the winter when the water hose freezes and breaks, who will be there to turn off the water? How about when that squatter moves in during the slow period, Is anyone in the Denver tech based basement going to fly out and evict them?

Check out the chart below. A list of items supplied that property managers often encounter. Learn how a tech, long-distance-based company would deal with them vs the local vacation rental property manager. This list is by no means complete.

vacation rental on gulf coast — Vacation Short Term rental house

COMPARE TECH/INTERNET/REMOTE MANAGER SERVICES TO LOCAL PROPERTY MANAGER SERVICES

Task/Item	Tech Manager	Local Manager
Vetting repair businesses	Telephone calls, internet search	Personal recommendations from actual customers where work can be observed
Police presence at property	May or may not know, telephone	Manager on site to work with police and diffuse situation
Discover illegal substances	Probably don’t know	Manager discovers, evicts or warns
Spot leaking toilet	If cleaner misses they dont know	Inspection finds before next rental, has it repaired
Overbooking issues	Possibly put in another property if they have one in the area that is vacant	Put into another property or contact other property managers with relationship to accomodate. Works in reverse.
Damage caused by guest	Have contractor assess or cleaner	Manager with experience will assess and have the issues resolved at the lowest possible cost in the shortest time
Guest decides not to leave	?	Manager meets with guest, requests they leave if not contacts local authorities with whom they have a relationship to evict.
House needs exterior paint	No one to notice	Manager looks at the condition of the property on a regular basis and schedules maintenance program
Owner can’t find remote	Speaks to guest tells them to look	Manage brings a new one and helps look for the existing one
Last guest left hose turned on	No one to notice	If freezing weather, manager will inspect property early in day to insure no water breaks
Hurricane approaching	Call guest and ask to leave	Manager will determine if hurricane is actually going to land in area and not two states away and keep guest informed.
Recommendation for local food	Tell guest to look on internet	Manager will inform guests of places they have eaten and how to get there, hours best dishes etc.
Guest wants to rent a boat	Check internet	Manager will tell guest of discount provided to guests of Christies and details about the rental process
Guests have too many cars to park	?	Manager will explain areas where they can legally park extra vehicles including other properties they manage
Best place to see a Mardi Gras parade	Internet	Manager will tell guests where they go, how to get parking and where to sit
Obtain city permit for vacation rental	Probably don’t know a permit is requried	Manager will assist the property owner in obtaining the correct
Pay sales taxes and complete reports	Probably not	Christies reports monthly to State for taxes

Most Internet/tech based Managers don’t do this

One of the larger companies charges a fee that does not include cleaning, maintenance supervision, or virtually anything to do with the actual property. What they do is post your property on the internet and coordinate with the guest to arrive there. The rest is all on the property owner. This company was reviewed by Rabbu.com. Their name starts with an E.

Another larger online company charges a list of fees and offers a linen service program and other programs with monthly fees pushing your cost higher and higher. Again, all coordinated from that basement or tower office in the far-off city.

The best property management companies are ones that operate in a defined geographical area where they can physically get to each property. A poor property manager is one who is not paying attention to the inventory of towels and regular maintenance. The right property management company will do simple things. For example:

A property manager for a local property management company will occasionally drop off donuts in the morning to guests. It’s a simple thank you for staying. Another has dropped off small gift baskets when a special occasion comes to his attention. The folks in the tech-based San Francisco tower are not likely to fly out and drop off a dozen donuts.

Local property managers have a real reputation not only to make sure the guest’s stay is excellent but because they are a member of the community. Bad news travels fast. Rental management companies need all of the goodwill they can get because they are competing with the lazy approach e.g. the tech groups.

Local Managers required

Many cities and counties require that the property manager be local. The rules below for Sonoma County are an example. Do you wonder why they ask for a local property manager? I was told by an individual working for a local city. There is a great deal of mistrust among the general public about vacation rentals in general. Most of the reasons why residents don’t like them is based upon rumors and misunderstanding.

The cities and counties have had bad experiences with removing tech-based property managers or even when owners try to manage their properties from afar. These few bad experiences are sufficient for them to be concerned that the public may latch on to future issues and force them to stop allowing short-term rentals. There is zero faith in a tech-based remote property management company’s ability to step in and fix an issue or prevent one form

Christies guest book

Christies, creates a “guest book” for each property that is specific to that property. It’s intended to inform guests of all of the amenities of the property they are staying in and to convey the rules. This book is particularly necessary for condos to help ensure compliance with local condo rules.

One of many jurisdictions that require local property managers, wonder why they are requiring this?

We could send an email to guests about all of this but does anyone expect a guest to remember what was sent or refer to an email months later? This is just one customer service that a local property manager can provide to help improve the guest experience.

One of the things that online property managers provide is technology. Reports etc. Local property managers hire experts too to create a similar experience for their guests. Christies provides an owner portal that not only provides a consolidated calendar but links to third-party sites, financial results, copies of signed documents, recommendations for setting up new properties, and much, much more.

The information we provide comes from hands-on experience. Our data was not created by scanning the internet for suggestions.

tech based property manager — Tech based manager just learned a clients property was broken into and damaged, and guests arriving the next day

Do tech-based operators know about houses?

Can one assume that most of the employees at the tech companies have years of experience not only as good property managers but understanding issues related to home maintenance? When a guest contacts them about a problem, they look up their local contractor and make a call. When there is a problem, we may know the source since we know the properties.

I just received a call that the refrigerator was not cooling well. I called our local contractor who works on all things refrigeration and he went there and fixed it. This may sound simple but it’s not. When the West Coast manager calls, it’s to a larger company that may be too busy for an immediate fix. When we call our local contractors, they respond promptly because they know it’s important to us. Plus, they all know how to interact with guests who may not be happy at the time.

A good property management company will charge a fair price for their services. It’s difficult to list all the times that someone on our team went to a property when a guest asked for a hair dryer (an old one stopped working) or to drop off extra pillowcases because their children had an “accident”. How about times when they could not get the TV to work with their streaming service and one of us stopped by to help? Do the people in those cubicles do this for their clients?

Can the tech-based operators clean for a fast turn?

How about a fast turn? A last-minute guest books the afternoon that a guest has left in the morning. All of the cleaners are busy with other properties. Our manager will go out and clean the property. We want the property to be in good condition when the next guest arrives. Is there an additional charge for any of the above to the owners? None. It’s all part of what local short-term rental property managers offer every day.

Another time, the air conditioning went out on a property. We were fully booked. The manager found a motel that would take our guests even with their dog (that was a trick). He helped them move their luggage. There was no cost to the guest and they received a full refund for their stay. This was our decision, not a third-party decision. The next time I need help with my luggage I will call the Denver tech-based call center for help.

About those communities that require local property managers. There are several on the Mississippi Gulf Coast where I am located. Very often property owners contact an Internet property management company about their short-term rental business. They decide to sign up and are not told that the City will not permit them to use a non-local property management company. If these companies are so great with technology why do they accept a client who must have a permit?

Tech based vacation property manager prohibited from managing — Example of Short-term rental permit application (they require a local manager)

Often permits are required but tech-based manager lists them anyway

This is the incompetence of the first order. I often look at short-term rental listings and find that some of these same companies have rentals in areas where permits are required. It’s a matter of time before the city checks on vacation properties and just find no permit is in place.

The vacation rental business is changing. Airbnb went from one million properties in 2018 to over four million in 2023. More properties on the market mean the short-term rental market is changing. This means more internet start-ups touting lower prices and more services.

These rental companies attract new property owners by dazzling them with terrific reports. Unfortunately, as much as they try to promise the performance of the vacation rental, they can not. The fact is that there is so much competition that occupancy rates are reflecting fewer guests to any single property.

A good rental property management company will utilize all of the power of technology, the same power that the Denver-based people use. With artificial intelligence available to everyone, it’s more difficult to differentiate your business. Local property managers differentiate their business by being there and knowing their clients. They are passionate about the area and can tell stories to guests about it. All of the property management software in the world will not make up for this personal touch.

Guests like to have the property manager dropping by

I will often visit a vacation rental and talk with the guests about the area. They are usually eager to learn about the best restaurants from someone who has been there. They want leads to rent toys or the best place to fish. All of this is provided by knowledgeable local property managers.

When I receive a call from a potential guest asking about the area, I can speak with them for a long time. Many of our guests return because their stay was so pleasant. Not just the actual property but those donuts as well.

Online reviews can be scrubbed and they are. Local property managers place a guest book where guests take the time to write great comments. These unfiltered comments provide great information to the property managers and owners. This is part of guest communication.

Granted it’s the back end but the front is equally good. Every guest will receive a phone call from the property manager. The whole point is to ensure that their stay is an excellent adventure. This communication also helps to prevent negative reviews.

Regular property inspections are important

Regular property inspections are a key difference between the San Francisco tech-based folks and the local property manager. The rental manager for that short-term vacation rental is representing the local rental management company that they may be an owner in. This makes a difference because it’s not just an employee performing the inspection.

Not only are the inspections looking for things that must be cleaned better, replaced, or repaired, but they are also checking for compliance with local regulations. Particularly if there is a permit in place, the property managers are looking for items required in the permit.

The major irony in the need for this article is that while the internet folks can go to the capital markets and get millions of dollars to invest in their untested business, local property managers must fully fund their efforts on their own. These smaller businesses with a vested interest in ensuring a good property value for their client’s property must struggle through all of the internet noise to be found.

property manager which is closest tech based or local — A water break after a freeze, routine local property manager inspection discovers the problem. Tech based security cameras miss it

Local property managers compete on the internet with start-ups

Local property management firms use the internet to advertise their services but are often overcome by the sheer dollars dumped into the Internet to advertise the distant rental management agreement program.

Something that is of potential benefit for property owners is that many local property management companies offer long-term rentals to the public. We recently suggested to a client that it was in her interest to rent her property for the long term due to the current crowded short-term market. Many rental property owners are likely to go this route. The difficulty of doing this on a national tech platform is all of the rental rules in every state.

Consider the worst-case scenario. You selected a bad property manager in Denver. There was damage to your home and how to you recover from them? You are in one state and your property is in another state. Many states require property management companies to be connected to a licensed real estate brokerage (Christies is) or to have a license.

If there is an issue at your property and the local property manager caused it, there are out-of-court remedies. Rental agreements in these states must follow guidelines to comply with the law. Don’t use internet tech based vacation property management companies.

Services provided by Christies Gulf Beach Rentals:

Complete set-up. You buy the house, condo, or townhome, we do all of the work. Including ordering furniture and furnishings plus decorating. Completely turnkey.
Supervising work to get the property in good condition means working with contractors to replace windows, doors, and other types of work necessary to convert the property from what it is to what it can be.
Provide accounting services.
Pay all of your bills each month including utility, mortgage, etc.
Much more is offered, ask us. All of the above is at additional cost and over and above the services provided to manage the property and guests.
Visit ChristiesGulfBeachRentals.com and read our blog articles and check out our site and other properties that we list for rent. Contact us if you are interested in having Christies manage your Mississippi Gulf Coast property.by using the button below.

William Anderson June 18, 2023June 18, 2023 1 Comment Property management, Real Estate, Vacation Rentals

Best Mississippi Gulf Coast Vacation Property Rentals Management Services

Looking for the Best Mississippi Gulf Coast Vacation Property Rentals Management company? Christies Gulf Beach Rentals can manage your vacation property completely hands-on. We do it all for you from managing the calendar and managing the cleaning process to directing repairs and maintenance. Our owners have decades of experience with property and business management. Our client portal has it all for you to help you manage your finances.

One of our owners has owned and managed a large national business. He has decades of experience with vacation rental management having owned many in Europe before the trend was popular in the U.S. Another owner has more than 20 years as a property manager. I could go on about our experience but it’s about how this experience is applied that you should be interested in.

We created Gulf Coast Property Management LLC for long-term vacation rentals management and then started Christies Gulf Beach Rentals for short-term rentals. We have two websites that refer people to your properties, not including the referrals from our associated Logan-Anderson Gulf Coastal Realtors website.

Christies calendar is consolidated with 3rd party sites

The state of Mississippi requires that all property management companies be affiliated with a real estate agent or broker. One of the Christies owners is a broker and owner of Logan-Anderson Gulf Coastal Realtors. This is a good thing for our clients. That real estate brokerage license means that the state is watching our operations.

It’s true, most of Christie’s bookings come from third-party sites such as Airbnb and VRBO but some of those bookings have come from people who have first visited the Christies website. Our site contains a consolidated calendar of all third-party bookings.

The calendar indicates all bookings for our client’s properties. If they choose to stay on their property, they can book it on Christies with a special code that permits their stay to be free.

The client portal contains links to not only the Christies site but their listings on third-party sites if they decide to look at them. Included in the Client Portal are links to the linen inventory, maintenance logs, agreements, HOA rules, and much more. It’s literally a one-stop place for everything they need to know about their property. One key item in the Client Portal is our financial data which indicates all details for paid stays.

vacation rental property — Newly constructed house, one of Christies vacation rental properties

No email reports, just 24/7 access to all data

Rather than sending out reports and emails. Clients have 24/7 access to the Client Portal to see for themselves how much they have earned in any one period (updated weekly). We feel this is far better than sending a rental income report that our clients are not ready to see or use. At the end of the year, their 1099 will match the data they have been seeing all year. This will permit them to make IRS quarterly deposits.

The State of Mississippi collects sales and guest taxes for local communities. Christies registers all of our client’s properties with the state. We report monthly at the Department of Revenue website on your behalf. If all revenue is from third parties, we check the boxes.

If Christies received a booking through our website, we collect sales tax and remit it in the report. The entire process is completed and you can rest assured if there is an audit, we are here to help.

Guest Guide is customized for your property

Our Guest Guide is another feature. We want our guests to know everything about the property including its history if any. This document is comprehensive and includes not only all of the rules (HOA also) but how to use things. WIFI code, parking instructions, and any regulations that local authorities require to be passed along. Listings of local restaurants, stores, and churches are included.

The Guest Guide is customized for each client’s property and our clients are involved in its creation.

Cleaning is a necessity so we manage the cleaning process. Brian our manager makes site visits to be sure that properties are ready for the next guest. The Guest onboarding process is something that Brian takes very seriously. He communicates with each individual on the day of arrival (also before). Brian responds quickly to guest requests.

Suggestions such as securing wall art

We meet with prospective owners at the property and walk through the property. We take this opportunity to explain our vacation rental management process. Often even experienced owners can benefit from our advice about various things such as how to secure wall art, fix beds to the wall, wifi thermostat, and much more. After years of experience with guests who are hard on properties, we have found some solutions to prospective problems.

Christie will for a fee, completely set up a house, condo, etc. She acquires all of the furniture, furnishings, and kitchen items, and even decorates often creating her own art.

Part of our service is to recommend such things as twin beds, picnic tables, the best ways to decorate, and much more. We recommend the correct sleeping configurations for the maximum return on your investment (and consider HOA

Coastal Cottage Guest Book vacation rental management — Guest Guide

How much can I earn from my vacation rental?

Adding two full beds for example instead of a queen bed will sleep two more. Brian and Christie provide excellent service to our guests and clients.

Christies is not just a vacation rental management business, we often manage the sale of our client’s vacation rentals or help a client find a property for a vacation rental. One of the key things we can offer in this process is knowledge of short-term rentals and their activities. A question often asked is? “How much can I make from my vacation homes?” This would be difficult for many but it’s not hard for Christies.

We use existing client data to extrapolate. Not only about the total income but the details such as how often it will rent. As a rental company, it’s our business to know about rates and occupancy. If you are planning on buying a rental property as an investment property or for personal use, you need data.

Consolidated calendar Christies Gulf Beach Rentals — Consolidated calendar

Christies offers knowledge about vacation management

Property owners need all of the information they can get to make decisions such as: “Do I keep it or sell it?”, “How much will I need to save from earnings to cover slow periods”? Rental properties are all different, even when they have the same floor plan and are part of a large condo group. Christies Vacation Rental property management services can help you manage your property as a business.

In addition to rental management, we offer additional services including:

– Creation of an LLC
– Quit Claim Deed of to LLC
– Accounting services
– Utility and bill payments (for those who don’t want to do anything)
– Landscaping (bi-weekly, monthly lawn care)
– Manage major repairs
– File permit requests and addend city meetings

The management fee

About that management fee. You will need to contact us about this. I can tell you that our fee is a fixed percentage of the gross income after deducting cleaning and HOA fees. Christies gets 100% of the cleaning fees. We do charge a minimum of $100 in any month where the income falls below $100.

This minimum fee which should be a rare occurrence is to compensate us for visiting the property to make sure it’s still there, in good condition and the pipes did not freeze in the winter. Our fee is very competitive.

We do not ask for a security deposit or any other type of deposit for our clients. We do charge a small start-up fee to manage the free photos, create your webpage, guest guide, program doors, thermostats, etc. As I said, it’s very reasonable. All property managers charge a set-up fee.

Sail boat regatta — Sailboat Regatta, Ocean Springs

Your income

Time to talk about your income. Don’t get excited, there are no specifics here, every property is different. You should know that your rental condo will be busy sometimes and not other times. For example, Mardi Gras is popular on the Mississippi Gulf Coast so you may expect to earn more during that time.

That perfect vacation may take place during Cruzin-the-Coast for example when rates are much higher than at other times of the year. You would think with all of the local casinos on the Mississippi Gulf Coast that people would want to stay there. They do but many also want a beautiful condo or house within easy walking distance of the beach. A place where the entire family can have fun.

Our Coastal Cottage property is within walking distance of the beach and is one of several beach houses that Christies rents. I have a fire pit and a large yard. This is perfect for a larger family that wants to enjoy their rental home and the sea breeze.

Mississippi Gulf Coast pond — There is more than beaches on the Mississippi Gulf Coast

Having many properties – more opportunities to rent yours

You may have a condo with great views and an outdoor pool. And of course, all of our properties have access to beautiful beaches. Sometimes we receive requests to accommodate a couple of dozen or more. This allows us to fill several clients’ properties at one time.

Other times when we receive last-minute calls for a property that is booked, we can move the new guests to another property. On occasion when all of our properties are fully booked, we coordinate with two other property owners who have several vacation rentals they manage on their own.

This coordination works both ways and helps find homes for our visitors. In the end, we want our guests to have the best vacation and our owners to earn a great income.

Social Media

In addition to the Christies Gulf Beach Rentals website plus Airbnb and VRBO, we post on Facebook and Twitter. Every new blog article is posted along with some blog articles about the Mississippi Gulf Coast posted on RetireCoast.com and Logan-Anderson Gulf Coastal Realtors. This keeps our sites active.

All new properties are posted on social media sites to draw attention. We encourage all of our clients to post their property on their social media websites.

If you are interested in having Christies Gulf Beach Rentals manage your property please reach out to us. Click on the button below and complete the client interest form. Click here for more information about property management

Owner interest form

William Anderson April 15, 2023May 9, 2023 Beaches, Gulf Coast, Property management, Real Estate, Vacation Rentals

9 reasons why local vacation rental property managers are better

9 reasons to use a local property manager for vacation rentals. Recently, internet-based property management companies have been advertising their services on Google. Property owners who are looking for a rental property manager often surf the web looking for a rental manager. When they find an internet-based property manager advertising that they manage thousands of properties, you stop and think. It may seem that the internet-based rental management company is the real deal. Local property managers exceed what internet-based property managers can do for their clients.

Before you decide on hiring any rental property management company consider the property management services that they can provide and what you need. To help you understand what you need in a manager for your rental properties I have compiled a list of nine key areas that you should consider. This assumes that you want a short-term rental manager that does everything for you, not just some things. You want a full-service property management company.

Our list starts below then I will drill down into some of the most important of the important points below, there is a lot of work involved in managing short-term vacation rentals. The items are not in any order of importance.

At least 9 reasons why local property managers are better

1. Permits

More communities are requiring permits to locate your vacation rental property in their city. You may also find that a permit cannot be issued on your property because it is located in a zone that does not allow short-term rentals and there are more of these zones than you may imagine. Vacation homes are not permitted in most residential areas. At least rentals of less than 30 days. Should your property be located in an area where you can obtain a permit, who will do this for you?

Biloxi short term rental permit — Example of a city Short-Term Rental application

In fact, from what I have seen, none of the boiler room internet-based companies have any idea if your property is located in an area where you can obtain a permit. If it is in an area where a permit can be issued, they do not advise the property owners of this fact. They start listing the property for rental and when the property owner is fined for not having a permit, the internet company claims they are not responsible.

Local property managers insure that your property can be legally offered as a short-term rental is one of the first things a local property manager will do for you. Christies Gulf Beach Rentals for example generally knows the zoning without checking from experience but does so anyway. If a permit is required, Christies completes the application and submits it in person to the municipality.

Proper fees are paid and that government inspector is met with your local property manager on site. That internet company has no clue about this process or any ability to make it happen. Operating without a permit can cost you. Fines of $500 per day are not uncommon.

2. Manage Cleaners

That internet property manager tells you that there is no problem with keeping your property clean, they have remotely hired a cleaner who does a good job. How do they know the cleaner did a good job? They learn from the comments people leave. It may take more than one 3-star rating to determine if they need a new cleaner. I have found that they also expect the cleaners to fix things or supervise repairs. They are not property managers.

Local property managers such as Christie’s Gulf Beach Rentals will supervise the cleaners meaning that they check their work. Properties are inspected regularly for not only cleaning but to insure items that are broken and worn are replaced. The internet property managers again are not on site and have no idea that the towels in the bathroom are faded because their cleaner did not tell them.

Your local property manager will immediately replace broken and worn things not wait for the remote property manager to ship something in. If you want high ratings from guests, cleaners must be supervised.

3. Legal Issues

What happens when someone is injured on your property? You call those people 10 states away and try to relate what the police told you. Remember your internet property manager can not be on-site in a short time to supervise and mitigate the issue for you. How about the fact that the hazard may have been avoidable if the internet property manager had seen that broken tree limb outside the front door? When law enforcement is called by neighbors, who are going to respond, the cleaner?

Will you need a legal team without a local property manager

Local property managers are required by some cities for these reasons. A client related an issue where the guests were having a party on their property. The police were called to solve the problem. The property owner was contacted by the police and not being local, they could not tell the guests to leave or shut down the party. Now that they have a local property manager, any issues with law enforcement, code enforcement, the fire department, or others will be solved quickly.

4. Neighbors

When is the last time your internet property manager met with the neighbors to inform them to call if there are any issues? Meaning, to call the property manager before they call the police. Never. You may have met with the neighbors but if they call you then this is not a full-service management program is it?

Neighbors have a big impact on vacation rentals — The local property manager meets the neighbors and works with them

Local property managers meet with neighbors and give them cards. They are asked to call the local manager for any reason which includes much more than police issues. Many cities that permit short-term rentals and ones that allow it without a permit will shut down your business if there are too many complaints. The local property manager working with the neighbors is your best defense against this happening.

5. Emergency/Storm

Of course, your internet property manager will check your property after a major weather event or even prepare it for a hurricane or storm. You know that the internet property manager will not send signals to close your shutters and windows. What about after the storm, will they be able to check your property for damage and help get it repaired? No.

Emergency/storm support from local property manager — Will that computer at the corporate office respond to your property in the event of an emergency?

Local property managers will close shutters and possibly install plywood for large wind storms. They will make sure that outside hoses are shut off and stored for freezing events. After a storm or event, they will check for fallen tree limbs and other hazards. You will be able to rest easy knowing that your property is looked after during emergencies. If there is a wildfire, they will check on your property when possible.

6. Maintenance

This is a key area, things get worn out and break. Internet companies try to manage this by calling a maintenance person out to do work that they are aware of. This is not a bad thing to do but who checks on the maintenance person’s work? Not the internet manager. Perhaps they ask the cleaner to see if the pipe was welded properly or if the AC system was fixed and a new filter was installed.

Local property managers understand much about routine maintenance. They know enough to supervise workers and make sure they show up promptly, don’t overcharge, and do good work. They know this because they put their eyes on the job. The maintenance person knows that the property manager will check their work, an incentive to do it well. Plus and this is important, maintenance people respond to people they know. Rental guests may be waiting for that AC repair tech who goes to another place because they know the local manager there and don’t know the rental owners or internet property manager.

7. Property Protection

Customer service is the key element with professional property managers. Internet property managers can promise super host status for example but they can not protect your property. Cameras can do only so much as everyone knows such as capturing someone wearing a hoodie. They can call the police too. They can’t walk your property to make sure that vacation properties are secure when guests leave. Can they remotely lock a window that was left open?

Local property managers provide full-service vacation rental supervision. They visit your property periodically checking on the cleaners, maintenance workers, pest control employees, and for many other reasons. Because they are local, stopping by your property their team members can check doors, windows, lights, water, etc. There have been several times when the toilet just kept running and a check by the property manager saved the owner on the water bill or potential flood. Making sure that security lights were not turned off by guests and that trash is collected are important best practices.

8. Rental Income

Internet property managers do a fair job of setting prices for guest stays. Services such as Airbnb and VRBO permit anyone to scan and calculate approximate rental prices for an area. Researching public domain information is how most property owners and internet property management companies derive their pricing. This is all good except if your property is in an area with lots of events that can demand higher rates. The internet managers do not have this local information nor it is applied to pricing. Yes looking at public pricing may help determine the numbers but averages are used which may miss key dates when higher pricing is expected.

Local Property managers often have years of experience in their market and understand the rental market well enough to price on individual dates. For example, on the Mississippi Gulf Coast every year there are a large number of events that draw guests to the area. Potential guests understand that they will pay more when Cruisin the Coast comes to the area.

People book one year out for this event which is completely transparent to internet property managers. They may see some bumps in rates but do not understand why and how much they can get. Internet property managers do not understand the extra charge you can earn by providing other services.

Local short-term rental management companies help their clients earn more money because they understand the rates. Most rental management services companies know other local companies and they share guests. If a property is full, a local property manager may refer that guest to a competitor. This networking is good news for guests who need a place to stay.

9. Property Management Fees – Value

Some internet management companies know their shortcomings and price their services accordingly. Prices range from low to high depending on the company and what they are offering. Often the internet management company is lower in cost than local property managers. This is the one area where they can meet or better the local competition. However, the internet property manager may not be the best choice for yet another reason.

property management fees based on value — Property management fees = Value Received

Local Property Managers are a good option and a better option for all of the reasons listed above. When it comes to the best vacation property management services, a local property manager will usually charge fees commensurate with the services they provide. What I mean is that you need to look beyond the property management fee as just dollars. Look to the value that a local property manager delivers. Consider the entire list of things above and calculate the hours that a local property manager will invest in your property vs someone sitting behind a computer screen at the corporate office.

It’s always a good idea to evaluate what you get for the money you spend. Christie’s Gulf Beach Rentals has earned the business of clients who were with a big internet management company. Christie’s price as it happens was exactly what the big company charges. Other local property managers often charge more but even then, those fees are based upon all of the items discussed above. Hours and hours invested in clients’ properties by the local staff.

Examples of what property managers do on site

A good example and a not uncommon one is this. A guest was staying at a vacation property. The air conditioning system stopped working partway through their stay. They had an 85-year-old grandmother who was suffering from the high heat. This issue occurred on a Saturday night and the part would not be available until Monday. The Christies Gulf Beach Rental property manager went out at 10:00 PM on Saturday and helped the guests pack their car.

They followed him to another vacation rental a couple of streets away. He let them in and helped them get settled. They were allowed to stay there for the next two days without paying the higher charge on the new property. The guests reported a great experience with a five-star rating.

Another example involved guests staying at another Christies property. The neighbors were having a party (property not managed by Christie’s) and the noise was terrible. The police were called but that did not fix the problem. The guests had a small dog and the Christies property manager found a hotel not far that would accept a dog, as it happens the very last room on the coast. Christie’s paid for the room for the night without charge to the guest. Their rental experience was very good according to their comments.

How would the internet vacation rental manager have handled the above issues? When you work with people, anything can and does happen. The right company, meaning the local company should be prepared to provide these essential services.

Calendar management

I have not mentioned the calendar or scheduling guests. Managing the calendar is an important task. Your local property manager will manage your calendar and communicate with guests. This is what internet property managers can do for you also except for meeting guests in person when necessary. Your local property manager can fill your calendar with available dates and prices based on what I discussed above. Guest communication is managed in a variety of ways.

vacation rental calendar — One property calendar. Your property manager consolidates all calendars for you to view at one time on their website

New guests should receive instructions about how to gain access. Christie’s Gulf Beach Rentals includes wifi based electronic locks on entrance doors. This permits the property manager to issue unique codes to guests before they arrive. Guests receive a phone call from the property manager before they arrive to discuss the rules, directions, and other things that guests may want to know. Some of this can be done by the internet property manager except by telling a guest about a great new restaurant.

Some internet property managers recommend or encourage owner participation in rental homes by having them manage the calendar. In my experience, the property manager should perform all tasks otherwise there may be communication and other issues. For example, one client may have a friend that cleans houses and they want theirs to be cleaned by that person. This situation may become difficult for the property manager if the cleaner is not doing a good job.

Local property managers should have their website to provide more income opportunities. Christie’s for example will permit guests to ask for amenities such as firewood for the beach or a fire pit in the yard. They can also buy insurance against damage or breakage through the website. This extra local service can not be provided through Airbnb and VRBO or by some internet property managers.

Financial and accounting process

Internet property managers provide lots of reports, they are good at this. Anything that can be done by a computer alone is in their area of expertise. Your local property manager should be providing reports as well. Christies for example offers clients a “client portal” where they can see everything going on with their properties. Records of maintenance, photos, and much more. 24/7 real-time financial details are in the portal showing property owners how much they have earned this month plus every previous month.

Private client portal 9 reasons why local vacation rental property managers are better — ChristiesGulfBeachRentals.Com Private Client Portal to manage your vacation rental property. This is your access to data 24/7

I was surprised to learn that one of the big internet property managers could not provide an owner a report listing income by platform e.g. VRBO, Airbnb, their site, etc. Christies provides details on every booking including its sources. Christies also pays local taxes for all bookings on the Christies site. This is just an example of what a local property manager should be able to provide any owner.

Mississippi and some other states require property managers to work under a real estate broker license. These regulations permit oversight by state regulators and help to prevent consumer fraud. Christies for example is associated with Logan-Anderson Gulf Coastal Realtors. Adding one more reason for working with a local property management company tied to a licensed entity, regulated by the state.

William Anderson November 30, 2022June 16, 2023 1 Comment Property management, Vacation Rentals

Internet property managers can cost you big now

Thinking about renting your vacation home? Before you reach out to high-tech firms located in a San Francisco highrise office building with a view of the wall. Consider a real local property manager. You need boots on the ground. How do they drive by and check your property? Who responds when the police are called because of noise? Locals are best for managing your vacation rental property.

Several tech-based start-ups claim to have a national reach for vacation property management. Why work through a third party? Go directly to a property manager in the area where your property is located.

Vacation home in Gulfport MS locally managed — Vacation rental Gulfport MS locally managed

Regulations in some cities require a property manager to be located in the same city or at least within x miles of the property. Some vacation rentals have created a bit of a negative reputation and some cities even discourage vacation rentals even when they are currently allowed. All good reasons why locals are best for managing your vacation rental property.

I would like a local property manager

I recently spoke with a prospective client who is just completing a renovation on a property he purchased to place on the market as a vacation rental. He called around and we were the first to call him back. He also told me that the others were not located in the area and he wanted to deal with a company that was local to his property. This makes sense for so many reasons, let me illuminate a few.

If the property were to be flooded or damaged in a hurricane, who will advise you? A good local property management company can help you get the property back on the market. We make it our business to know people at city planning and other offices responsible for issuing permits. These relationships are important.

Should the police department call us for one of our clients, they know we will respond without hauling everyone off to jail. Sounds silly but this is true. Some of our principals know many police officers and this allows us to escalate issues with neighbors. Another reason why locals are best for managing your vacation rental property.

Have you obtained your short-term rental license?

Yet another new client contacted Christie’s to discuss a changeover from the big tech company. A large party took place at their new house and after thousands in damages, they decided to make a change. The police were called and there was no property manager to be found.

As it happens this property is located in one of the cities along the Mississippi Gulf Coast that require a property manager to be located in the area. The biggest potential problem was that the big tech property manager failed to tell the owner that they needed a local permit. The permit comes with fees of $750 initially. Failure to obtain the license and pay the fees to subject the property owner to large fines.

Christies stepped in and as part of our management agreement, we help the property owner with the application and submit it for them. The fire department may inspect the property and Christies will be there to let them in and answer questions. This is one area where a property manager is critical. if the fire department finds something wrong, they can suspend the permit days before a guest is to arrive.

Cleaners are not property managers or repair contractors

Many of the companies that operate the boiler rooms and claim to be your property manager find maid services in the area to clean the property after it is vacated. Often these are larger companies hiring lists of people. The same cleaner may not come to the property more than once. Our property manager works with independent contractors who are assigned to the same properties all the time.

Cleaners are not contractors meaning that they do not make repairs. Meaning that the distance property management company will have to find a local maintenance company to make repairs. I can tell you from experience a good handyperson is very difficult to find and keep. Distance companies will have to call larger contractors at more expense to you

Local property managers have their “guys” (no offense to all of the other genders) who are essentially on call when something goes wrong. The AC person we use is extremely reliable and will often be at a property and have it repaired within an hour. This person can diagnose almost any problem and find a cure quickly.

Zoning map of Long Beach MS sowing zones where vacation rentals are permitted — Zoning map City of Long Beach, MS

Local relationships

As mentioned above, in our business which is property management along the Mississippi Gulf Coast, we know many elected officials and this is a good thing. The subject of vacation rentals comes up often at the City council and planning department meetings. The local government can either allow your rental property to be there or they can cause you terrible financial harm.

We and other locals keep in touch with decision-makers and staff to be sure our clients are well-represented when the topic of vacation rental comes up. Recently in one city, there was a vote to change some zoning to permit more vacation rentals. The results could have affected our clients. Would your long-distance management company know this?

Managing your property is not just about getting exposure on third-party websites such as Airbnb or VRBO, it’s about many things such as keeping the property well-maintained and providing excellent on-site customer service.

Property owners should have a direct relationship with the local property manager

Our property manager has regular and frequent communication with our property owners. Yes, we offer a turn-key approach so that the owners are not needed on-site. Owners are not involved in disputes or maintenance issues other than to approve expenses. A good property manager can make all of this happen without a hands-on approach by the property owner.

On the other hand, the property owner wants to know the people that are putting their hands on the property. They want to speak to the manager who just checked out a reason for a high water bill for example. Why would you want to call someone in Seattle about your Mississippi Gulf Coast property?

Vacancy rates are up

The economy is slowing and vacancy rates are up particularly in the slow season. High seasons see higher occupancy rares with people coming and going. This keeps the bad element away because the properties appear to be occupied. What happens in the off season when your propery may go for weeks without guests? This is an open invitiation for someone to break in or for someting to fail e.g. water leak.

Who goes by and looks at your property when there are no guests? That corporate computer has no abilty to visit your home. Yes there are security systems but they do not see that rodents are eating inside, wasps are building a large nest or there is a gas or water leak. Only an on sight property manager can do this for you. Something to consider.

If you are not now a rental property owner and are thinking about it, please read some of the relevant articles on the RetireCoast website and the Logan-Anderson, Gulf Coastal Realtors website. You may want to read this article on our Christies website

William Anderson November 4, 2022June 11, 2023 Gulf Coast, Income property, New Property, Property management, Real Estate

Best way to profit from renting my vacation home:2023

What is the best way to make a profit renting my vacation home? To start, you can buy a property on the basis that you will stay there periodically but it is primarily for rental. Or, you can buy a home that is truly your vacation home and you just want to earn some money when you are not in residence.

The difference here is subtle but important. Some people look for a home that suits their style and they decorate it for their purposes. These people may use the property multiple times per year and for longer stays. Others just want a place for the occasional weekend and they would like it to pay for itself and possibly make a profit.

Still, others start out looking for a property that will become a full-time vacation home, and of course, that property should be profitable the first year.

Most vacation rentals are owned by individuals who have purchased a second home for vacations and decided to earn extra income to offset costs. If you already own a second home in an area that attracts visitors and are interested in earning some offsetting income you may be in luck. Renting your vacation home is something to consider.

I will expand upon this as you read on. Before getting into the second home issue, you should understand the difference between owning a vacation home strictly for earning income as a business and your second home used for the occasional family getaway with rental income supplements.

Purchasing as a full-time rental

Purchasing a property for the exclusive purpose of renting it out as a vacation rental is a completely different proposition than buying a property to use periodically (these are called second homes). You can pay cash for your vacation rental or you can finance it. If you are buying it exclusively for business purposes, you will be required to put at least 20% down and possibly 25% depending upon the lender and the property.

One of Christie’s Gulf Beach Rentals Vacation Rental Properties

If you finance, you will have a mortgage which along with taxes, insurance, maintenance, management fees, utilities, and other costs must be offset by income. Very few properties can generate sufficient income to cover the debt and ongoing costs plus generate an adequate return on invested capital. particularly if the property is financed.

I have owned many vacation properties, some were purchased as second homes intended primarily for our enjoyment with supplemental rental income. Others were purchased exclusively as vacation rentals.

Before you attempt to buy a property exclusively to rent it, consider the costs and weigh the income/loss against the use of your money elsewhere e.g. stock market. Aside from risks, you may be better off placing your money in other investments. Run an analysis to make this determination. Our real estate broker partners can walk you through the analysis with their exclusive KEYLADDER property investment system.

Paying cash is one strategy, and OPM is another

If you pay cash for your business vacation rental, you may turn a profit. Depending upon your ongoing costs e.g. taxes, insurance, maintenance, HOA fees, property management, fees, etc. Without mortgage debt, the picture is vastly different.

On the other hand, paying cash reduces your return on investment. Leveraging is the best way to obtain investment property. Your ROI will be higher since you are using other people’s money and your guests will pay off the mortgage. Again, this may not work for most properties even in ideal settings if the cost to operate can not be overcome by higher rental income.

Back to your vacation home that is rented for part of the year to supplement your income or reduce your costs. Frankly, this is the very best way to own a vacation rental that earns income. Starting with the fact that you can buy your second/vacation home with as little as 10% down. The main assumption should be that you can afford the costs of this property without any income. Start here with your math.

Example of Second Home Analysis

I was just researching to find a good example and found a newly built home one block from the beach in Gulfport, MS. The property is 1.750 sq ft with four bedrooms and two bathrooms and places to park four cars under the building. This is a single-floor building that is elevated to meet flood requirements and obtain lower insurance rates. The property is in an excellent location near restaurants and casinos.

The seller wants $319,000. I ran the data through the KEYLADDER system and found that with a 20% down payment the property would lose about $286 per month.

This means that as a second home that you can visit during the year and rent it the remainder of the year, you would be expected to pay $286 each month out of pocket after deducting the income from all expenses. Many people would look at this as a great investment. It looks better than I am explaining here when you deduct property taxes and interest payments as a qualified second home. With just 10% down the shortfall would be $443 per month.

Keep in mind that two other things are happening. The property is growing in value and the principal on the mortgage is being paid down. The estimated return on investment with 20% down is about 100% over five years. Not bad. You can see that this property is not a profitable investment on a monthly cash flow basis so I would not recommend its purchase as a straight investment if it is financed.

The hardest thing is determining the income

The hardest thing for a buyer of a second home who wants to rent it when not in residence is determining income. Two factors are the price per night and the number of nights per year. Prices will vary depending on the time of year.

You can take the time required to survey other properties in the area and determine what similar properties are receiving based on the season and other factors. You can also check their calendars to determine how often they are booked. Your research will not allow a look back as the calendars do not usually retain past data for you to see. Don’t be captivated by the high season income as the reason to buy your second/vacation home. Remember its peak income for a short period.

If you need the additional income that renting to others provides, avoid using your property during the high season or events. If you can afford the cost of the property without renting, by all means, use it when you wish. It’s hard to eliminate the emotional aspect of believing that your property is the best in the area and it should rent for more or rent more often. Your property as viewed by others is the key.

It takes time to build a reputation

It will take time on third-party sites e.g. Airbnb for your property to build a reputation. During that time, your rents will be lower than others with lots of reviews. You can help kick-start the process if you hire a property manager with a high status on third-party sites. People will look at a property and see that the managers have a high status and at least with Airbnb, they list other properties managed by the same company. People may find yours by clicking on those links.

Essentially, you ride the “coattails” of the property manager with a high degree of success. After a while when your property has earned high marks from guests, your property will rent more often and you can consider raising the rate. Guests want to stay at highly-rated properties and read what others have said.

Should you decide to use your second home as a vacation rental, be sure to lock up everything personal that may get broken or disappear. We recommend putting a lock on a closet door. This is also a place where the property manager can store linens if yours are used for guests.

The grounds should be kept in great condition. You should contract with a gardener or through the property manager to ensure that your grass is always looking good and weeds are pulled and plants are tended to. If you live in an area that requires watering, install an irrigation system.

How much of the year will my place be rented?

People ask, how much of the year should I expect my property to be rented? There is no magic formula. Every area is different. The best that can be said here is that if your property is located very close to tourist areas it has a better chance of being rented more often.

A good example is a 3 bedroom, 2 bath house that is within a block or two of the beach. This property would usually rent more often than properties a few miles from the beach or even a few blocks further away. Walking distance is important.

Swimming pools are great in areas where people expect to spend warmer days e.g. the South or West. Properties with pools offer more amenities than a condo without one for example. As mentioned above, the key season will generate the highest amount. Shoulder seasons will generate some income and low seasons will probably not generate sufficient income to cover costs.

If you are considering buying a property for a second home and renting it when you are not here or renting a property you already own on the Gulf Coast contact us. We would like to manage the property for you. Christie’s can also put you in touch with our strategic partners which include Logan & Anderson Gulf Coastal Realtors to help you find your dream second home.

We can help you create a budget and determine an approximate income for the property you desire to acquire. As mentioned above, very few properties will earn enough as a stand-alone investment to cover all costs if the property is financed. Should you desire to create a vacation rental as a stand-alone profit center, we can assist with a list of items you will need and the approximate cost to set up a property.

Second home tax deduction vs a business

A few list items. You will be able to deduct the mortgage interest and property taxes as an investment or a second home. Consult your CPA for the impact on your tax obligation. You may be able to deduct some costs associated with the property such as insurance, maintenance, and even periodic travel to the property. The benefit will depend upon your financial situation so again, seek help from your CPA.

Should you decide to purchase a second home and use it as a vacation home and also rent it with the intent of later retiring in the property, there are some great tax benefits to consider. As a full-time resident living on the property, you can receive a homestead deduction. If you are over 65 there is a larger deduction that is quite beneficial in reducing your property tax bill. Your CPA can discuss how to convert a second home to a permanent home if it was rented.

Keep in mind that non-residents must pay a tax when their vacation property is sold in Mississippi. If you decide to move here and have established residency here, you can sell your vacation house without paying that non-resident tax. Yet another reason to do some planning with your CPA.

A suggestion you may want to consider. Stay at a vacation rental or two or three in an area you like. Regardless of whether you are going to buy for your use or full-time income property, get a feel for the area and talk to professionals who manage vacation homes. Here comes our advertising.

Consider taking a course on investing in short-term rentals

If you plan to invest in short-term rental property consider taking the KEYLADDER Short-Term Rental Investment course. This course will take you through every aspect of investing in a short-term/vacation rental property. The cost of the course will be earned back many times over through the unique information provided. Click here

free Mini-course short-term rental investing

Gulf Coast Property Management can manage your vacation home and help you achieve your goals of earning income on that property. We can also fully set up a property that you have purchased from acquiring furniture to decorating. We offer turn-key solutions to people who do not reside in the area but who want to be sure that their property is well cared for.

Christies Gulf Beach Properties is the marketing arm of Gulf Coast Property Management and your property would be listed on the Christiesgulfbeachrentals.com website and VRBO and Airbnb and others as part of our program. Or if you just want someone to keep an eye on your vacation home when you are not there e.g. having the lawn cut etc., we can do that too.

One last point, if you are looking to purchase a property, please consider using our Real Estate sponsoring agency Logan-Anderson, Gulf Coast Realtors. We will work with them on a smooth transition from purchase to set up. Contact Bill Anderson at Logan-Anderson at 228-215-3234, he and Sean Logan are experts at finding vacation rental properties. Bill owns several that we manage for him.

William Anderson September 4, 2022November 25, 2022 Income property, Property management, Real Estate, Vacation Rentals