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  1. #1
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    Vacation Property Management Questions

    I'm considering buying a place on the Oregon Coast and basically have an in on an attractive off market house that is being offered to my family due to a preexisting relationship. I know the area well as my family has a place there and much of the neighborhood has short-term vacation renters coming through (airbnb, vrbo, etc). I'm up in Seattle and am busy as it is, so I want to have a management company help out as much as possible:

    (1) Just how full service are vacation rental property management companies these days and what is a common percentage of rent in exchange for the services? Ideally, I would like to have them market the place (list on the right platforms), handle the scheduling, triage renter bullshit, get maids in there after each use and generally just send me any $ left over after they take their cut. I'll pay for the convenience, but does something like that exist?
    (2) I don't expect to cover my monthly nut despite the fact that the area has demonstrated what appears to be decent occupancy, but I do want to try to pencil things out as much as possible. My thought is to find the best management company for my needs (see #3), call them up and give them the specs on the house and see if they can run some actual comps on usual occupancy rates and daily charge for the area, home type, etc and in exchange for the info, they get a likely new client. I imagine most places are open to that discussion, no? And if not, where are potential buyers getting their data to figure out overhead?
    (3) How do I find the right company to call/work with?
    (4) I'll call my mortgage broker, but for the brokers on TGR, where are second home interest rates sitting right about now if we have great credit?

    I know many of you have vacation places that you rent out on the short term (PNWbrit for instance), so any advice would be helpful. And let me know any glaring things I should watch out for besides the obvious like making sure its not a dump that needs major repair out of the gate, family politics, etc.

  2. #2
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    so, not a timeshare?
    "fuck off you asshat gaper shit for brains fucktard wanker." - Jesus Christ
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  3. #3
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    Quote Originally Posted by Art Shirk View Post
    (1) Just how full service are vacation rental property management companies these days and what is a common percentage of rent in exchange for the services? Ideally, I would like to have them market the place (list on the right platforms), handle the scheduling, triage renter bullshit, get maids in there after each use and generally just send me any $ left over after they take their cut. I'll pay for the convenience, but does something like that exist?
    Depends on location. Maybe there is a good local company that's taking care of the market nearby. Maybe there isn't as they're a dying breed because of the rise of Airbnb and VRBO.

    We manage ours ourselves using Airbnb (we stopped using VRBO as was too expensive and was giving ever fewer inquiries) you can set up Airbnb to be pretty much hands free if you want.

    What is key is to find a reliable cleaner (plus a back up) and a good handyman. It also helps me only being 75 minutes away from the property...

    In the hood where our cabin is there is a property management business, she's a friend and an absolute sweetheart... but when we've ever talked about her business and my property her prices have been ridiculous for basically just saving me a handful of emails a week.

    You'd get a better idea of the market by looking for vacancies at other short term rental listings in the area than by asking someone to give you sales pitch for how well their agency is going to rent your rental on airbnb.. which is what they will end up doing... probably after charging you for their own website listing which won't ever create business because of airbnb.

    Other things?.... how remote from civilization? difficulty in getting contractors and larger repairs done that a handyman can't handle. Internet/Cell service... people demand that shit, being off the grid or not really fast enough for Netflix is not a sales pitch and will lose you business.

    We have big issues with power outages in GW and it hits our rental business somewhat. What is history of that in this area.

    Connections into the local community rather than being a fully remote owner definitely help.

    Our HOA just pushed back a drive by a couple of crusty owners to limit short term rentals, which for now has been quashed .. anything like that going on with your place, yet?

    Edit: Don't underestimate the off season drop off in business. Our place is basically unrentable from when ski lifts close late April until summer and then from maybe Labor day until it snows.

    Quote Originally Posted by Danno View Post
    so, not a timeshare?
    Polite golf applause.
    Quote Originally Posted by Downbound Train View Post
    And there will come a day when our ancestors look back...........

  4. #4
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    Ditto to the above. Management companies are pretty variable in what they charge, but from what I've seen, it tends to be a significant chunk for them to do everything. Finding a reliable cleaning company is super important, and sometimes you get what you pay for. Check to see how short term rental income is taxed; here it's taxed as sales tax and Airbnb automatically remits sales tax on their rentals to the state. We've self-managed for the past 5 years or so, first through Airbnb, VRBO, and FlipKey, but now just through Airbnb since it's interface is so much easier to use and we tend to get a steady stream of rentals through it (though it's getting swamped with management companies that are now also listing their rentals on Airbnb, not just in-house). Also check to see whether you have anyone agitating for change about short term rental restrictions, either in your HOA or your community at large.

    For the most part, self-management has allowed us to save money, and the overhead isn't much - just fielding a few emails a week in the busy season. It also gives us control over rentals since if we want to block or unblock dates we can do it without needing to go through a third-party, though maybe you can still do that with some management companies.

  5. #5
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    As has been pointed out above but can't be stressed enough, investigate whether short term rentals are in danger of regulation/termination, as well as the future likelihood of that. Many people in many communities are getting burned* by these changes, where they purchased assuming such income and can't get it now.

    * by "burned" I don't mean to defend these people, as short term rentals have the potential to destroy neighborhoods and communities, just that you can get burned when your investment thesis suddenly changes dramatically.
    "fuck off you asshat gaper shit for brains fucktard wanker." - Jesus Christ
    "She was tossing her bean salad with the vigor of a Drunken Pop princess so I walked out of the corner and said.... "need a hand?"" - Odin

  6. #6
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    Ok, awesome feedback guys. Sounds like I should start by investigating the work involved in self management via airbnb, looking into independent cleaning services, doing research on vacancies myself, and looking into whether there are any local challenges to short term rentals in the area.

    Brit, I shouldnt have a problem with normal amenities like internet, etc and access to contractors, but all good considerations that I may have taken for granted.

    Brit and Craven, if you dont mind the ask, how much of your monthly nut are you covering through rental income after all expenses including mortgage, taxes, maintenance, utilities, etc? I know it wont translate because each home is different, but just curious whether you are constantly in the mindset that way more money is going out each month than coming in.

  7. #7
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    Quote Originally Posted by Danno View Post
    so, not a timeshare?
    I still cut checks for that investment. If anyone wants to get into fractional ownership near the most murderous city in the world, PM me.

  8. #8
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    I find that very few of my clients choose to self manage, and instead choose a management company like you're describing in Q#1. Typically, the split will be 60/40 or maybe 70/30 (with the bigger number going to the homeowner). They deal with all the bullshit and send the owner what's left, as you describe. They'll also do walk-throughs during the slower times of year to make sure the icemaker isn't leaking or whatever... Yes, a good management company should be able to provide a few comparable rental histories to give you an idea of what to expect.

    How to find a good management company? Call a good real estate agent. They should have a good handle on it, assuming rentals in the area are at least somewhat common.

  9. #9
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    Quote Originally Posted by Art Shirk View Post

    Brit and Craven, if you dont mind the ask, how much of your monthly nut are you covering through rental income after all expenses including mortgage, taxes, maintenance, utilities, etc? I know it wont translate because each home is different, but just curious whether you are constantly in the mindset that way more money is going out each month than coming in.
    Probably not a good question for me, we don't try and maximize our rental business, particularly during ski season when we use it a lot ourselves. Accordingly I can price it at the high end of market and sell $$$ holiday weekends to make my income.

    Also we own it with another (now separated couple) who manage their own now separate ownership weeks based on their usage/needs.

    I could probably rent it every weekend during ski season if I wanted to. I get a handful of mid week inquires each winter. Maybe 20 or so requests each fall for season long rentals - which wouldn't work for me but would probably cover the group's total annual nut.

    As mentioned hump seasons are barren and before the gondy pumped up the tourism, weddings and general attention to our side of the park summer business was pretty slow. maybe one weekend a month in height of summer. I could probably do 75% weekend summer occupancy nowadays with a good chance of a few mid week or week long stays during that period. (the H1B crowd also seem to be big into summer mountain rentals)

    That said last year I covered about 40% of my annual share of expenses. I'm pretty sure my co owners did better than that.

    Not sure how much my market crosses over with Oregon beach market though.

    Airbnb have been reasonable to deal with the few times we've had any issue with damage or excess cleaning claims... although again I am extremely suspect of all rental enquiries and throw out any that have a bad smell. Automating the booking process make that impossible.. and scares the willies out of me.. so I have it set to full manual control which is a little more work.

    60/40 was the kind of number that agent was expecting from me.. to list it on airbnb and schedule the same cleaner and handyman that I already use...
    Quote Originally Posted by Downbound Train View Post
    And there will come a day when our ancestors look back...........

  10. #10
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    Just handle it yourself.

  11. #11
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    A family purchase..? Make sure you have those rules locked down tight.

    Like you are buying it with a complete stranger.

    Imagine a complete family break up or melt down. Process for forcing a sale, valuation of ownership for sale to other partners, inheritance of shares, shared responsibilities of ownership, unexpected expenses and abilities/desires to pay for those.

    Trust me on this.. going into it thinking that you can work it out later will bite you in the ass.
    Last edited by PNWbrit; 05-02-2019 at 06:31 PM.
    Quote Originally Posted by Downbound Train View Post
    And there will come a day when our ancestors look back...........

  12. #12
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    Quote Originally Posted by goldenboy View Post
    I find that very few of my clients choose to self manage, and instead choose a management company like you're describing in Q#1. Typically, the split will be 60/40 or maybe 70/30 (with the bigger number going to the homeowner). They deal with all the bullshit and send the owner what's left, as you describe. They'll also do walk-throughs during the slower times of year to make sure the icemaker isn't leaking or whatever... Yes, a good management company should be able to provide a few comparable rental histories to give you an idea of what to expect.

    How to find a good management company? Call a good real estate agent. They should have a good handle on it, assuming rentals in the area are at least somewhat common.
    40% commission is very high for a property management company... even Vacasa is only 30% iirc and many are in the 20-25% range. Of course this varies by region etc

    Quote Originally Posted by Bobby Stainless View Post
    Just handle it yourself.
    it's ~10hrs/week for a year-round rented place, according to self-reported numbers from homeowners. remember you're going to be changing sheets, emptying trashes, etc. whether it's worth 10hrs a week to you depends obviously. with a professional mgr you will do no work, but get less money. if the margin is very important, do it yourself. if your time and peace of mind etc are worth more than the commission %, use a professional manager.

  13. #13
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    40%. Wtf?

  14. #14
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    Airbnb has some pretty end to end service partners these days. I don't know your area, but here they would take care of absolutely everything for you.

    For vacation rental company comparison, a buddy in Tahoe is using one and they charge him 28% plus some additional bullshit charges that add another few points. He just doesn't want to deal w anything, but if there are already Airbnbs in that area, I'd say that's probably best to put you effort there.

    There are a couple of companies that are basically virtual vacation rental companies like RentLever that may work as well depending on local

    But def take the temp for future short term rental ordinances that may be on the horizon.

  15. #15
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    Quote Originally Posted by Bobby Stainless View Post
    40%. Wtf?
    I saw that many a time a decade ago when I was researching. It sorta makes sense if there is good appreciation, you need tax write-offs , and you are in for the long term and want a place in the mountains in retirement. Sure wish I had a place in the mountains in retirement.

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  16. #16
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    Quote Originally Posted by mall walker View Post



    it's ~10hrs/week for a year-round rented place, according to self-reported numbers from homeowners. remember you're going to be changing sheets, emptying trashes, etc. whether it's worth 10hrs a week to you depends obviously. with a professional mgr you will do no work, but get less money. if the margin is very important, do it yourself. if your time and peace of mind etc are worth more than the commission %, use a professional manager.
    I assume art is not planning on doing the cleaning at an Oregon coast property himself?

    Since he's in Seattle.
    Quote Originally Posted by Downbound Train View Post
    And there will come a day when our ancestors look back...........

  17. #17
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    Quote Originally Posted by Art Shirk View Post
    I still cut checks for that investment. If anyone wants to get into fractional ownership near the most murderous city in the world, PM me.
    what about those companies that specialize in getting people out of timeshares? Do those not work?

  18. #18
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    Not to hijack...or add any helpful advice....but “funny” story with a local management/cleaning company where I’m at .....rumor is, owner of cleaning company uses the properties to “meet up/screw” all the guys she’s cheating on her husband with.....Not sure the company will be around much longer...lol

  19. #19
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    Quote Originally Posted by PNWbrit View Post
    I assume art is not planning on doing the cleaning at an Oregon coast property himself?

    Since he's in Seattle.
    then you’re paying for it, which comes out of the difference between the commission and not, right?

  20. #20
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    Quote Originally Posted by mall walker View Post
    then you’re paying for it, which comes out of the difference between the commission and not, right?
    Like I said earlier find a good local cleaner and back up. Pay them, not an agent's or an ap's marked up rate for paying probably the same person.
    Quote Originally Posted by Downbound Train View Post
    And there will come a day when our ancestors look back...........

  21. #21
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    Quote Originally Posted by PNWbrit View Post
    Probably not a good question for me, we don't try and maximize our rental business, particularly during ski season when we use it a lot ourselves. Accordingly I can price it at the high end of market and sell $$$ holiday weekends to make my income.

    Also we own it with another (now separated couple) who manage their own now separate ownership weeks based on their usage/needs.

    I could probably rent it every weekend during ski season if I wanted to. I get a handful of mid week inquires each winter. Maybe 20 or so requests each fall for season long rentals - which wouldn't work for me but would probably cover the group's total annual nut.

    As mentioned hump seasons are barren and before the gondy pumped up the tourism, weddings and general attention to our side of the park summer business was pretty slow. maybe one weekend a month in height of summer. I could probably do 75% weekend summer occupancy nowadays with a good chance of a few mid week or week long stays during that period. (the H1B crowd also seem to be big into summer mountain rentals)

    That said last year I covered about 40% of my annual share of expenses. I'm pretty sure my co owners did better than that.

    Not sure how much my market crosses over with Oregon beach market though.

    Airbnb have been reasonable to deal with the few times we've had any issue with damage or excess cleaning claims... although again I am extremely suspect of all rental enquiries and throw out any that have a bad smell. Automating the booking process make that impossible.. and scares the willies out of me.. so I have it set to full manual control which is a little more work.

    60/40 was the kind of number that agent was expecting from me.. to list it on airbnb and schedule the same cleaner and handyman that I already use...
    All great info. I'd be happy with 40% and I expect I would use the place much less than you use yours. It's just too far and I may go a couple times a summer with the kids and my mistress.

    Quote Originally Posted by Bobby Stainless View Post
    Just handle it yourself.
    Based on the descriptions of some of the end to end services wrapped up in airbnb, I'm considering it, but I feel like I dont even have an extra hour a week to spend on this shit between work, kids, volunteering, carving out some minimal time for leisure.

    Quote Originally Posted by PNWbrit View Post
    A family purchase..? Make sure you have those rules locked down tight.

    Like you are buying it with a complete stranger.

    Imagine a complete family break up or melt down. Process for forcing a sale, valuation of ownership for sale to other partners, inheritance of shares, shared responsibilities of ownership, unexpected expenses and abilities/desires to pay for those.

    Trust me on this.. going into it thinking that you can work it out later will bite you in the ass.
    It a friend of the family that owns the place but i would buy it outright. That was one of my rules. I can totally see shit going sideways with family or any other shared ownership.

    Quote Originally Posted by mall walker View Post
    40% commission is very high for a property management company... even Vacasa is only 30% iirc and many are in the 20-25% range. Of course this varies by region etc



    it's ~10hrs/week for a year-round rented place, according to self-reported numbers from homeowners. remember you're going to be changing sheets, emptying trashes, etc. whether it's worth 10hrs a week to you depends obviously. with a professional mgr you will do no work, but get less money. if the margin is very important, do it yourself. if your time and peace of mind etc are worth more than the commission %, use a professional manager.
    Yeah, I wouldnt be doing the cleaning and day to day. I would hire it out to a local place. But I'd still have to deal with the logistics, which adds up.

    Quote Originally Posted by mcski View Post
    Airbnb has some pretty end to end service partners these days. I don't know your area, but here they would take care of absolutely everything for you.

    For vacation rental company comparison, a buddy in Tahoe is using one and they charge him 28% plus some additional bullshit charges that add another few points. He just doesn't want to deal w anything, but if there are already Airbnbs in that area, I'd say that's probably best to put you effort there.

    There are a couple of companies that are basically virtual vacation rental companies like RentLever that may work as well depending on local

    But def take the temp for future short term rental ordinances that may be on the horizon.
    Sounds like I just need to see how inclusive and easy airbnb is before I make any decisions on PM companies.

    Quote Originally Posted by iceman View Post
    what about those companies that specialize in getting people out of timeshares? Do those not work?
    I'm guessing they are the other side of the shitty coin and probably don't work, but at this point, I'd rather pay money to get out of it than stay in longer term. I think my wife looked into it at one point and the fact that she never brought it up again means my bank account got lighter and I still have some sort of quasi interest in 0.000045% of part of a building in murderville Mexico. It's worth looking back into though.

    Quote Originally Posted by BC. View Post
    Not to hijack...or add any helpful advice....but “funny” story with a local management/cleaning company where I’m at .....rumor is, owner of cleaning company uses the properties to “meet up/screw” all the guys she’s cheating on her husband with.....Not sure the company will be around much longer...lol
    My buddy just built a gorgeous place out in the CA desert, has been short term renting it and apparently the area, and even more specifically his home, has become a hot spot for gay males for some weird reason. His cleaning crew reports some crazy shit but the money is great.

  22. #22
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    Go down there, go to the local watering hole, get drunk, make friends, get the pink thing to spankpickle.

    Voila: management company!
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  23. #23
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    Quote Originally Posted by BC. View Post
    Not to hijack...or add any helpful advice....but “funny” story with a local management/cleaning company where I’m at .....rumor is, owner of cleaning company uses the properties to “meet up/screw” all the guys she’s cheating on her husband with.....Not sure the company will be around much longer...lol
    Hey, as long as she cleans up afterwards. Won't be too hard, right? So to speak. Besides, imagine the shit that the actual renters are doing in your vacation home. Right?

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    Pissing in the sink.

  25. #25
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    Vacation Property Management Questions

    I’ve frequently seen total commission rates / fees / service in the 40-50% ranges when analyzing properties that sell condos or houses in resorts and rent them on their behalf. When looking at Airbnb or VRBO tax returns self managed usually find about 15-20% variable expenses and managed come in at 30-40%. Some are as low as 5-10% if they truely do everything themself and are just paying some commissions. Obviously there is an incentive to make expenses as high as possible and revenue as low as possible on those documents.

    Make sure you add a few percentage points to the costs to account for increased wear and tear and utilities.

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