What Will It Cost
Of course, we need to think about the initial investment. How much exactly is it? If you dont have enough money on your own for it, how will you afford it? How much monthly expenses do you think you will have because of it? Are you being realistic with your numbers? Make sure that you are, otherwise, you will end up with a crunch in your numbers when the actual paying comes. You may also see commercial real estate marketing plan examples.
Mortgage payment, monthly maintenance, taxes, and insurance are just some of the bills you need to prepare for. You should also consider having a reserve account from which you can take funds to cover emergency repairs and unforeseen vacancies in your rental property.
Anticipate the exact amount of monthly income you will have. This means that you need to foresee the vacancy rate in the area where your rental property is located. You also need to calculate how much you can charge for the rent. You may also see risk management examples.
How Do You Get Glamping Experience
If you dont have much glamping experience but want to get started in the industry, wed recommend trying out some unique vacation rental experiences for yourself. Look up the glamping options in your area and try out a few that catch your eye. While youre there, take note of the things you like and would like to replicate, as well as what could be improved.
Once you have an initial glamping business idea, start creating a business plan. This step will take a lot of research, planning, and hard work, but itll help clarify whether your idea is feasible. Youll also be able to use it as a tool to secure partners and investors if you decide to move forward with your glamping business.
Last, start small in the glamping industry if you dont have much experience. Start-up costs for unique vacation rentals are relatively low, so build and rent out a couple of properties, analyze your success, optimize as you go, and then think big.
Moving Onto Third Party Property Management Takes You Into A Completely Different Professional Sphere
Step 10
Hiring And Managing Your Team
If your business depends on you, you dont own a businessyou have a job. And its the worst job in the world because youre working for a lunatic!
Michael E. Gerber
The E-Myth Revisited
?Steve Milo was up to 125 properties before he hired his first staff member to help with booking and administration.
Its not necessary to wait until your portfolio grows to that level before taking on a first employee, and in the early days you may just want some part-time help.
For many people taking the first steps into property management, they want to do everything themselves.
Theyll spend countless hours learning about all the software thats available, get involved with social media marketing, do their own bookkeeping, take all the property photos, deal with guest inquiries and problems, worry about all of it, and burn out in the first year.
Its the story of many entrepreneurs..and its my story.
When I started a property management company, I thought I had to do it all myself because how could I possibly afford to hire someone from the get go? And on top of that, letting go and appreciating that someone else could do some of the things I did..and betterwas a tough one to accept.
If I had the chance to do this over again, Id do just about everything differently.
Moving from managing a personal property to becoming a full-time property manager is no longer the daunting prospect it was ten years ago when so much of the work was manual.
Don’t Miss: Sand And Sun Vacation Rentals
Why You Need A Business Plan
If youre looking to start a vacation rental business or grow your existing vacation rental company, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your vacation rental business to improve your chances of success. Your vacation rental business plan is a living document that should be updated annually as your company grows and changes.
Furnish Your Vacation Rental
When it comes to furnishing your rental property, there are countless options available to you. The types of furniture you choose to decorate the property with will depend on your needs, budget, target guests, and personal preferences. As you choose what furniture you want to buy, keep the following factors in mind:
Recommended Reading: South Africa Vacations All Inclusive
Make Your Request For Funding
Theres no one way to secure funding for a unique vacation rental, but here are some options:
- Crowdfunding: Make a fundraiser on a platform like GoFundMe and get your community to help you raise money to set up your first glamping site.
- Startup investments: Platforms like StartEngine help startups and early-stage companies find investors by offering investment opportunities.
- External investors: If your glamping business is a good investment opportunity and you make a good case for it, youll likely be able to get external real estate investors interested in coming on board.
- Bank loans & lines of credit: Apply for a bank loan or line of credit to get the money you need to build and launch your first few glamping properties.
- Partnerships: Consider whether theres anyone in your personal or professional network whod want to go into business with you. Theyd agree to invest a certain amount and get a percentage of your profits down the line.
Related Post: Glamping Market Size, Trends, and Business Outlook For 2023
Industry Analysis And Strategy
To be successful in the rental business industry, you need to be strategic with your vacation property management business plan.
Things to include:
- Where you currently stand in the vacation rental market
- The size of the market
- Current trends and expectations
- Your strategies for achieving bookings in the future
- Technology that may be required to grow your business
- The online and offline channels you plan to use
- Costs for technology, marketing, management, etc.
TIP
Analyze the area where your property is located. Is it a popular vacation spot? Do people travel there for business, leisure, adventure, etc.? How many rentals are in the area? What are the peak times for tourists? The local tourism department or chamber of commerce can be a valuable resource. Consider enlisting a property management company that also offers strategic marketing services, like Grand Welcome.
Recommended Reading: Best Site To Book Hawaii Vacation
Vacation Rental Business Plan Example
Weve given you the essential components to include in your business plan, but if you havent created a business plan before, it can be helpful to look at an example to get a better idea of what that looks like. Heres an Airbnb business plan template to help you out: Fast Business Plans features a downloadable vacation rental business plan that can be adjusted for vacation rentals.
A comprehensive business plan may also include roles and responsibilities, a SWOT analysis, sales forecast, pricing strategy, and sustainability and expansion strategy. At the very least, this info can be included in the appendix so you have it if you need it.
Without A Doubt You Will Need A Website If You Want To Achieve Maximum Independence From The Major Listing Sites As Its The Foundation For All Your Marketing Efforts
Step 4
Managing The Operations Of A Rental Business
So youve done the research, the property is set up and staged, your marketing plan is in place and you are ready to rock and roll.
Lets get those bookings coming in!
But just hold on a moment..
Before you get to this point you have a little more to do, to make sure that everything goes smoothly.
And this for some could be the boring stuff the systems and the processes that you must have in place before anyone walks in the door or even reserves a vacation with you.
When I first got into the vacation rental business I thought I could do it all on my own and I was so wrong.
- I knew I needed a website so I tried to learn how to use WordPress which took a massive amount of time, was frustrating and stressful, and the outcome was clunky and ugly.
- My business systems were home-made with spreadsheets, paper calendars, a lot of post-it notes, and irritation when someone else couldnt figure out how to navigate them. And I double-booked someone!
- My photography was pretty poor. The images seemed OK but when compared to the competition that had used professional photography there was no comparison.
- I decided to do my own changeover management and wasnt emotionally detached enough to walk in to a recently vacated property and not get upset by the way guests had left it. And no-one ever left it in a really poor condition it just was not to my personal standard, and I got unreasonably stressed and annoyed.
Michael E. Gerber
Read Also: 7 Bedroom Vacation Rentals In Orlando
Write A Business Plan
To ensure your short-term rental business is a success, you need a business plan. A well thought out plan can guide your strategy, identify risks, and help you secure funding to expand and grow your enterprise.
Heres a suggested outline for your short-term rental business plan:
- Executive summary: A brief overview of your venture, your property differentiators, and why your vacation rental business will be successful
- Company description: Provides detailed information about your business and explains your competitive advantages
- Organization and management: How your company will be structured and who will run it. For example, will it be a partnership, LLC, S-Corporation? Who will be responsible for day-to-day management?
- : What is the industry outlook? Who are your target customers? What competition are you up against?
- Financing plan: A description of your funding requirements, your detailed financial statements, and a financial statement analysis.
- : An overall game plan for reaching prospective consumers and turning them into customers.
How Will You Manage Tenants
What will you require from your tenants as they move in? How much will you charge for the security deposit? Landlords usually charge on to one and a half months rent. Will you apply the same rule? How will you select the right tenants? After all, you just cant have anyone living in your property, can you? Will you run a credit check on prospective tenants, or will you choose to give them all the benefit of the doubt?
Do you have all of the proper legal forms such as the lease, rental application, or the notice to quit, or will all of this be conducted without that sort of formality? Do you understand what fair housing is? Do you understand how to evict a tenant? Will you make your property pet-friendly, or are these cute little creatures banned from it?
Being a landlord is not limited to having a property, renting it, and then collecting the money at the end of the month. There are legal preparations that need your attention and documents you need to have. You will be responsible for an entire inhabited building. Make sure you are ready for that responsibility. You may also see wholesale real estate marketing plan examples.
Recommended Reading: Holiday Inn Club Vacations Timeshare For Sale
Write A Vacation Rental Business Plan
Before advancing with any plans to start your vacation rental business, its important to write a business plan. A business plan is a roadmap that guides you through the process of starting your business and can be a valuable tool for securing funding and gaining support. A successful business plan should include information on your business concept, the market youll be operating in, the structure of your business, and detailed information on your financials.
To learn more about how to write a plan of your own, check out our article on how to write a restaurant business plan.
Have An Online Marketing Strategy
According to data more than a quarter of people look for BnB services online these days. And thats quite a huge proportion if you dig deep into the data, and nowhere small enough to leave untapped. Hence, it becomes essential for your business to have an online marketing strategy, to attract your target audience.
You May Like: Steamboat Vacation Rentals Ski In Ski Out
The Complete Guide To Writing A Vacation Rental Business Plan
All posts,Vacation Rental Tips
A well-thought-out vacation rental business plan is key to upgrading your business and ensuring your success as a host. As you are starting a vacation rental business or increasing the number of Airbnb properties in your possession, such a plan will help you stay on top of all your business requirements.
With a thoroughly detailed business plan, you will be able to secure the funds from lenders or investors that you need to develop your business. Furthermore, creating a viable strategic plan for your vacation rental business will help to identify potential risks before others start investing in your business.
Understanding Your Fit In The Marketplace
Armed with this competitive knowledge, you are ready to describe your property , its unique selling point, and explain how it will appeal to your target audience.
First, identify your target audience:
- Families with young kids
- A business or corporate travellers
- Large groups and/or extended families
- Mature, affluent, retired adults
- Any combination of the above
This audience can shift for different types of accommodation and at different times of the year. Families will tend to get out during school holidays, pensioners will be a better audience to target in the low-season.
You may also notice micro-trends with who books 8 weeks out, 2 weeks out or even 2 days out. All of this information will help inform how best to present your property. For example, if your audience consists of large groups, showcase that your dining room can comfortably seat 12 people or that your media room has sofa space for 20. Appeal to your target audience for the best results!
Next, you need to describe the main value proposition for your business, in fact, for every accommodation type on offer.
- Why should your target audience stay with you?
- What is most unique or exciting about your place?
In writing up your unique selling points, you need to be sharp, truthful but you also need to bring forward your propertys best assets, including its location. Do not overplay things, as you will disappoint your guests and risk bad reviews. But do not be shy either if youve got it, flaunt it!
Read Also: Short Term Vacation Rental Lease Agreement
Getting The Lay Of The Land
Youve got the basics of your vacation rental business plan laid out. Its time to start doing market research.
First lets take a look at the vacation rental industry, and narrow it down to your specific market. Write a general overview of what the vacation rental space looks like where youre looking to set up shop. Once you have the general summary, pivot to how you will position your vacation rental within that existing space.
The vacation rental industry is rapidly growing, which means its a competitive space. While they arent your enemies, the saying keep your enemies closer rings true. Understanding your competition is vital to finding where youll fit in the marketplace and ensuring your business has room to grow.
Look at direct competition and check-out similar vacation rentals in your area. And do not forget to consider other forms of accommodation as a possible competitor. Hotels and B& Bs are another choice. So pay close attention to details like their occupancy levels, average daily rates, seasonal pricing, and the facilities and amenities they offer etc. Take fastidious notes!
Next, you must put in place a coherent sales and marketing plan.
Whats The Secret To A Good Short
Its really all about the timing. It is advisable to write a business planbefore you buy the rental home, so you can truly judge if it is a worthwhile investment and business venture. Remember that a vacation rental is no small project, so before being strapped with $200,000+ of debt, make sure the ends justify the means by guaranteeing a secure investment through a well-thought-out business plan.
But if you want to succeed with your business, we also recommend asking the experts those who already have a triumphant and proven business in the rental market, and those who work every day with rental owners all around the world.
Thats exactly what we did to write this article. We got in contact with Antonio Bortolotti, Cynthia Chan and Karen Spencer all professionals in the field who are ready to get you through your very own business plan.
We asked them a few questions, to help YOU craft your business plan. Lets get started!
You May Like: Bluegreen Vacations Boyne Falls Mi
Nine Questions That Can Help You Develop And Focus Your Plan
Whatever the reason may be, there are certain questions you can ask yourself to help you put together a strategy for a long-term success. These questions will help you focus by answering the who, what, when, where, why, and how of starting a business. You may also see rental inventory examples.
Unfortunately for you, you cant skip this part since there is no cookie cutter for starting a business. Each one of us will have different goals and objectives when investing in real estate, which means that we cant simply follow other peoples footsteps. We need to make our own. The secret lies in defining your personal objectives and then developing specific strategies and plans of action to meet them. You may also see real estate strategic plan examples.
You can start by asking yourself how you can make money through real estate, and deciding how much exactly it is that you want to earn per month. However, to be more specific, here are nine questions that can help you develop and focus your plan: