Summary: How do you successfully self-manage your short-term rental? And why is doing so important? You’ve heard about the tax benefits of short-term rentals. Maybe you’ve heard of some friends who are making six figures from one short-term rental. That all sounds great until you realize that you might have to self manage your short-term rental. That means communicating with guests throughout their stay. That means working with cleaners in between stays. Maybe you WILL have to deal with that dreaded toilet problem in the middle of the night. So how do you overcome these fears?
And what is the one key to successfully self managing your short-term rental? Read on to find out!
[Disclaimer: We are not accountants, lawyers or financial advisors, so please consult your own team of professionals about the topics covered in this article.]
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If you’re in the process of buying a short-term rental you’ve probably asked yourself the question: should I self-manage?
You might have also thought to yourself: Is it even feasible? Do I have the time? Where do I even start?
If so, you’re in the right place. We’re going to explore the topic of self management. And, if you decide to take this leap, how to successfully self-manage your short-term rental.
What Does it Mean to Self-Manage Your Short-Term Rental?
Self managing a property involves wearing a lot of hats.
Your overarching role is to ensure that your guest’s have an amazing experience. You are the Chief Experience Officer.
Many owners focus on the logistics. It’s important to get the logistics right, but it’s often not enough to get those coveted 5-star reviews.
Think about the Four Seasons. If you’ve ever stayed at a Four Seasons, you know they go above and beyond to make you feel special. They start off with a welcome drink when you arrive. Then, it’s the little treats they bring to you when you’re sitting by the pool. They always go out of their way to fulfill your requests. The experience is what sets them apart.
So for a short-term rental, this might be the welcome gift when they arrive. It might be a handwritten and personalized welcome on a message board when they walk in. Maybe you know that your guests are celebrating a special occasion and you give them something special and unique to help them celebrate.
Beyond that, it’s getting the logistics right.
Get professional pictures done for your property. Put your listing on various online travel sites like Airbnb and VRBO. Message your guests throughout their stay starting with a welcome message when they book their stay. Then, send them check-out instructions and thank them upon departure. You address issues in a timely fashion.
So Why Would Anyone Want to Self Manage?
So what are the benefits of self management?
It probably seems like a lot of work to deliver a 5-star guest experience. As well as flawless execution on the day-to-day logistics.
Well the benefits are substantial.
First, you’re going to significantly add to your cashflow by eliminating the property management expense. Property managers for short-term rentals can take as much as 30 to 40% of your revenue. That can represent tens of thousands of dollars each year!
For one of our short-term rentals, our property manager charges us 30% or over $30,000. If we were to self manage, instead of $40,000 we could bring home a total of around $70,000 per year in cashflow!
Second are the tax benefits. Many in our community self manage so they can qualify for the short-term rental tax benefit. Which shelters their W2 or 1099 income. If you don’t know about this benefit, click HERE to read more about it.
Third is having control over your ratings. When you outsource property management, you’re completely reliant on the property manager to perform at a 5-star level. Some property managers just aren’t very good.
We stayed in a short-term rental once and didn’t have hot water for the first 5 days of our stay. The property manager didn’t apologize once. And only offered a $100 discount on a nearly $8,000 stay after we asked about the discount. He didn’t even offer a discount, we had to ask for it. Needless to say, he didn’t get a 5-star review.
I felt bad for the owner. However, at the end of the day, the owner hired the property manager and he/she needs to oversee their work.
The One Thing That’s Stopping You From Self-Managing Your Short-Term Rental
Now that you see that self-management comes with a TON of benefits, what’s stopping you?
For most, it’s simply fear.
While it’s completely normal to feel fear, most people succumb to it. They get stuck and they fall into analysis paralysis.
So you have to figure out a way to get past this fear. This is probably one of the top reasons people take our short-term rental course.
Having a mentor who can show you how to succeed and avoid mistakes is invaluable. Seeing others with the same fears, also helps tremendously.
What’s the Key to Successfully Self-Manage Short-Term Rentals?
If I were to boil down how to successfully self-manage your short-term rental, it all comes down to constant and never ending improvement.
You might not be an instant success and that’s OK!
If you commit to constantly learning from your mistakes and improving, you’ll inevitably succeed.
For example, one of the most important tools for self managing is short-term rental software.
This is easily one of the biggest sources of stress for new short-term rental owners.
It starts with worrying about choosing the wrong software. If you don’t know yet, there’s a ridiculous number of software options to choose from.
The only way to make progress is to choose one and see how it goes. If you have the mindset of constantly improving, then you stop worrying about getting the choice right from the beginning. You can always pivot and change software programs.
Will it be a pain to switch? Sure. But at least you didn’t waste any time worrying about your choice and countless hours researching the different options.
If you want a short cut, we recommend OwnerRez. Don’t think about it too much, take action and run with it. If it doesn’t work for you, in the spirit of constant and never ending improvement, switch to something else. If you decide you want to take action and sign up for OwnerRez, CLICK HERE.
In Conclusion
Short-term rental software is just one example out of many where constant improvement is the key to successfully self-manage your short-term rental.
You may not be an instant success, but you’ll be on your way to succeeding with short-term rentals. And isn’t that what really matters?
Want to learn how to build a significant source of income from investing in real estate while reducing your taxes? Join us in one of our courses, Zero to Freedom, or Accelerating Wealth.
