The New Reality of Owning a Vacation Rental

If you are a Vacation Rental junkie like me, you have no doubt heard about and agonized over the new guest “service fee” added by HomeAway and VRBO. I really wanted to reserve my comments until I had a chance to listen to all sides and analyze the benefits, if any, of this drastic change in approach for the VR giant. After a lot of blog reading, too much social media, and conversations with some of my colleagues, here are a few comments and observations that I feel really starts to clearly define the workload and value of a professional vacation rental management company:

  1. Guest Support. I’d be VERY careful with this one Homeaway! As professionals, we’re already providing a “safe and secure booking experience” and “premium customer support”. We have been for years. I honestly cannot imagine what actual 24/7 guest support looks like from a marketing website. If I can direct all of our unhappy guests to Homeaway and VRBO for resolution, then sign me up!
  2. Sticker Shock. Yes, I know, “But it’s less of a percentage than what AirBnB charges”. The problem is the dollar value of stays, in general, that I see on Homeaway and VRBO are higher. Especially for our homes on Topsail Island, North Carolina. Take one of our homes, 10,000 Reasons. A wonderful 4 bedroom Oceanfront property. For the week of June 11th, the Service Fee quoted was $197.73 on VRBO. You have to ask yourself as an Owner or a Guest, what is the value of this fee?  Am I supposed to call VRBO if here is a leaky toilet? Professional management firms have to clearly define what their additional fees are, and provide the value and service of those. Not to mention, $197.73 is a bit extreme for just clicking book on a third party website…
  3. “Take Rate”. I absolutely despise the term “Take Rate” that these third party website companies use to describe their fees. When was the last time you heard a management company describe their fees as “Take Fees”.  I think you get the point…
  4. Pro Management Costs.  There has been an attack over the years on the cost of using a professional management company market and care for your topsail vacation rental home. I’m here to tell you most of the things you hear are misleading at best, or just plain wrong. All of the ones touting this almost always have a hidden agenda to get in your wallet. How much is your time actually worth? Do you have the best local contacts for timely repairs (and by timely I mean yesterday)? Can you negotiate the best terms on marketing, supplies, linens, etc by yourself? All good management companies operate on a true pay per performance structure.  We do not get paid unless you get bookings.  Period. The best manager/owner relationships and most successful owners I have seen over the years operate in tandem. Good open communication and mutual respect.  Maybe ask yourself, can you really afford NOT to go with a pro manager with how fast the vacation rental industry is moving today?
  5. Alternatives? There are more ways to market than just listing sites. Shocking, I know! There have been a couple blog posts recently that have more or less defended the new VRBO and Homeaway service fee and explained how it is going to bring us into the world of “big time travel”. These companies may be a little bias as their entire business model is built around marketing homes on these websites. In the professional management world we’ve been establishing homeowner relationships, marketing direct, building huge databases, communicating with repeat guests, and painstakingly building a lot of local web value and authority over the years. Management firms that have made this commitment are much less apprehensive about the future of these sites.  Frankly, most don’t care. They’ll pivot and find something else.

A colleague of mine mentioned just the other day on a conference call that the Vacation Rental business is a marathon, not  a sprint.  I think he is exactly right. Still at the heart this is a relationship business. No algorithm can replace trust in the people that care for your “home”.

Bottom line, there are tons of top quality professional management companies like Topsail Realty Vacations all over the country. They provide actual “boots on the ground” service, and can look you in the face if there is a problem.  They have poured thousands of dollars into website platforms and software so anyone can book “safe and secure”. They have a high degree of local website authority, with impressive organic search placement. Just try googling where you want to go and “vacation rentals”. The creme usually rises to the top. If you can get through the paid clutter, you will likely find that ideal vacation home, with a cool boutique firm, with local service, and save yourself $200 in the process.

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