Vacation Rentals (part 2)
March 18th, 2008 by KenricVegas Condo Hotels
I heard this on the Ray Lucia show last week. I was suprised to hear that he said that he had purchased condo hotel investments in Vegas. He said that he bought the best unit he could. He bought a higher end condo on the highest floor possible and one of largest units. The caller was thinking about buying the cheapest condo unit on a lower floor.
If you’ve ever read a condo hotel management contract they will usually say that they rent out rooms based on a random lottery. This in theory would give everyone an even chance of getting their units rented. However, you have to remember that this is a hotel and they are running a business. They still have to give the customer what they want.
If you have a condo on the 5th floor facing another building and someone else has one on the 5th floor facing the strip, even though the computer may try to rent out your condo, the customer may ask, “Do you have one facing the strip?” Of course the front desk will check and say yes and proceed to change them to the other unit. The same can be said for customers asking for higher floors. Guests will often try to get the best room they can at check-in. Whether it be the highest floor, largest square footage or the best view, your lower end unit will get passed over for the better units even though the management may try their best to rent yours out.
This is the same concept as I mentioned in my Vacation Rentals (part 1). The higher quality upgraded condos will get rented out more often. So if you are going to do a vacation rental, don’t go cheap.
Vacation Rental Property Management
Finding a good property manager is probably the most important factor in a vacation rental. Two weeks ago when I was trying to find a vacation rental, I emailed back and forth with a homeowner. We traded emails about the area and about other vacation homes he had. Ultimately, we couldn’t agree upon a price for the week. I later found out that homeowner is also the owner of an NBA basketball team!
The first thing that popped into my head was wondering, what is an owner of an NBA basketball team doing managing his own vacation rental property?
I guess property managers must be really hard to find!
Posted in Real Estate | 4 Comments »
Stumble it!
Good PM’s are seriously hard to find! But, I would’ve figured the owner of an NBA team could’ve just had his assistant do it. Maybe they’re just seriously cheap!
By Trisha on Mar 18, 2008
Good MCs are indeed hard to find. However you also need to decide what you want from them. Do you just want a housekeeper and do the renting yourself or do you want full service management.
There is a strong argument to say that if your MC does both then there is a huge conflict of interest as they are working for two customers, you and the guests. Not a good idea.
It also amazes me that people will invest large sums of money in houses thousands of miles from home and hand over control to someone they might have met once, briefly.
Plenty of horror stories in Florida.
Vacation rentals demand a lot more input from an owner than long term rentals…Definitely not a route to the passive income you require.
By VRBooker on Mar 20, 2008