Ocean City Maryland Vacation Rental
I'm looking for a vacation rental property in Ocean City Maryland that my family and I can use a couple times a year and rent out the rest.
I currently have "regular" rental properties and for the most part understand in my area at least how much say a 200-250k house can rent for each month with a year lease but have no idea where to start in trying to determine the potential rents of a vacation property.
How do you determine how much rent per week/month/year you can realistically bring in? Is it best to reach out to a vacation rental company to get this information or will they exaggerate?
I would appreciate any direction you have to offer.
Check AirBnB and VRBO to estimate rates. Use a 50% vacancy allowance on short term rentals.
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@Bill Ames let me take a stab at assisting.
If you'll allow me, I'd like to expand the discussion to look at extended stay rentals along side your vacation rental business model.
Ocean City has two extended stay hotels: Home2 Suites (Hilton) and Residence Inn (Marriott). That means the research has already been done; these corporate giants set up shop because a good number of people that come to Ocean City want temporary housing for 30 days and longer.
Consider competing against them. They currently advertise rates of $73 to $110 per night + tax + lodging fees, etc.
I bet if you undercut their rates and offered guest more space and privacy then you could make the numbers work.
You would, of course, block out time when your family wanted to use the home.
The reason I like this approach is because Marriott and Hilton know what people want and how much they will pay. We will never be able to do better research than they do.
So, accept their numbers as the official top of the market and base your buying decisions off their insights from years of global experience in the hospitality industry.
You may want to price yourself lower than the brand you choose to compete against and then match their numbers as you build a great reputation and learn to get direct bookings.
Hope that helps.
@Al Williamson
Al , that was very insightful and great advice . But I bet renters may would actually be willing to pay a slight premium to have a clean, comfortable, private residence all to themselves . Location of the property would be a key factor so a home closer to the beaches and amenities would be best choice for location .
@ Al thank you for the thought. That is a good point and something I'll make sure to consider for down the road. For now as I look for properties I'm going to focus on the short term rentals to make sure the property is worth it for me.
For anyone in the OC Maryland market what kind of returns on your money to you expect to receive? This is a new market and a new rental strategy for me. I know there is a lot of information out there and I intend on researching it but much of what I find is from several years ago.
@Bill Ames I am also searching for a short term rental in Ocean City. I'd love to connect sometime! I really like what Al said about the extended stay. You could offer that during off-season if you didn't want to offer it during the summer.
Hey @Bill Ames. I live in Ocean City. It really all depends on location and # of bedrooms of the unit. Direct oceanfront will yield the most rental for you but will also cost you the most. Ocean block units seem to have a great return. I know 3 bed 2 bath units on ocean block pull in about $35-40k in the summer months. And if you rent bi weekly that number could go as high as $45k. Some of the bigger building with the amenities like Golden Sands and The Carousel have no trouble renting. You can certainly call some rental companies in the area and they will share their figures with you. I call for clients sometimes.
@Bill Ames Please reach out if you would like to discuss some more detailed numbers on specific property types. I run short term rentals (Airbnb/VRBO) in Ocean City MD (3B/2B units), and wouldn't mind sharing some data, and provide you more insight into the seasonal times etc.
I appreciate all that responded. Wanted to give an update (because I feel like no one ever does) and let you all know I pulled the trigger and will be closing in March. Next comes the fun part of deciding how to rent it out. I was leaning towards VRBO but may switch up and go through CB Vacations (coldwell banker) for the first year and then re evaluate for the next year. If anyone has any input or strong opinions I would be happy to hear them out.
Thanks again,
Bill
Hi @Bill Ames
We did the same thing, we closed in March. We bought a townhouse on the bayside by 94th street. We have it listed with Coastal Rentals and going to try them the first year to see how it goes. I have a couple of STR in Berkeley Springs, WV. So this is the first time in OC. There are definitely different things that apply to OC. In WV, my STR has linens, towels, and everything ready for the guests and we pay the cleaning fee. But OC looks like the guests pay the cleaning fee and rent the linens. Also, we got a suggestion to do 3-day minimum stays instead of weekly stays. Wanted to see if anyone is doing weekly compared to 3-day minimum stays and which approach worked for them.
Also, if anyone has tips/tricks for STR in OC? I love to hear it.
The other thing is that getting contractors in the summer months is near impossible.
Thanks,
Claudio
@Bill Ames Thanks for updating the thread!
@Claudio Meira tagging you based on your recent post as well.
I have run properties in Ocean City as STRs for a bit now, and I recommend a few things:
1. If you are going to use a management company, I would recommend looking for referrals from their other clients. Some of the larger ones in the area have issues with quality. I experienced this personally, which drove me away from them.
2. If you want to list on your own, I recommend diversifying your channel sites. VRBO is by far the most popular in Ocean City, but don't neglect Airbnb.
3. Don't be afraid of "senior week" or "senior month aka June". Yes, makes sure to vet your guests well, but don't leave that money on the table. Its a guaranteed, core part of the Ocean City culture, year over year. Just understand the type of guests those weeks / month tailor to, and plan appropriately.
4. Linens and such are really up to the host. You will find a mix of both provided and not provided by the host. There are pro's and con's of each, and it will come down to your cleaning team and expectation setting.
Hope to help, message me if anyone wants to discuss further, happy to share insights.
Couple of updates since my last post
We closed in March and did some renovation during the next month or so. It's now listed with Coastal rentals and they have it listed on Airbnb and VRBO. Even with the late start, we have about 70 days out of 90 days rented in the Summer and most are 3-day rentals. So far it's going well with Coastal, they charge 12% and I noticed that they also charge the guests a fee as well. So far no guests have had issues with the linen rentals.
The other thing that I noticed is that there are certain events where the rental company will automatically block it off for us since in the past there have been lots of violence. For example, towards the end of September, there is an event called h2oi ocean city 2021 which had several issues in the past. So I'm glad Coastal Rental flagged this.
https://www.delmarvanow.com/st...
@Claudio Meira @Bill Ames
My husband and I are new investors and also looking for STR in OC also. We are from that area. Also interested in long term rental in Baltimore area.
hey Claudio,
OCMD is one of my target STR markets but I’ve also been going to OCMD for the past 10 years or so twice annually. We always book “mini weeks” which is Thursday - Sunday or Friday - Monday.
how has your OCMD journey been?
Originally posted by @Claudio Meira:Hi @Bill Ames
We did the same thing, we closed in March. We bought a townhouse on the bayside by 94th street. We have it listed with Coastal Rentals and going to try them the first year to see how it goes. I have a couple of STR in Berkeley Springs, WV. So this is the first time in OC. There are definitely different things that apply to OC. In WV, my STR has linens, towels, and everything ready for the guests and we pay the cleaning fee. But OC looks like the guests pay the cleaning fee and rent the linens. Also, we got a suggestion to do 3-day minimum stays instead of weekly stays. Wanted to see if anyone is doing weekly compared to 3-day minimum stays and which approach worked for them.
Also, if anyone has tips/tricks for STR in OC? I love to hear it.
The other thing is that getting contractors in the summer months is near impossible.
Thanks,
Claudio
hey Bill,
curious how your journey is turning out thus far.
Originally posted by @Bill Ames:I appreciate all that responded. Wanted to give an update (because I feel like no one ever does) and let you all know I pulled the trigger and will be closing in March. Next comes the fun part of deciding how to rent it out. I was leaning towards VRBO but may switch up and go through CB Vacations (coldwell banker) for the first year and then re evaluate for the next year. If anyone has any input or strong opinions I would be happy to hear them out.
Thanks again,
Bill
@Bill Ames
How was the first year?
Quote from @Antonio Tull:
@Bill Ames
How was the first year?
It's been great. My condo is primarily a rental but the family and I were able to enjoy it for a week during the summer while breaking even on the year which included the renovations we did in the beginning. The real surprise has been the appreciation. I would like to get another one but the prices have shot up so quickly it will be hard to make the numbers work.
Oh and for those wondering we ended up using a management company. Its pricey but not dealing with the day to day has been worth it. We figure if we want to management it ourselves at any point we can make the switch but as of right now we don't plan on changing anything.
I settled on a property in Ocean City on July 5th, waiting on the rental license to get going.
Quote from @Bill Ames:
Quote from @Antonio Tull:
@Bill Ames
How was the first year?
It's been great. My condo is primarily a rental but the family and I were able to enjoy it for a week during the summer while breaking even on the year which included the renovations we did in the beginning. The real surprise has been the appreciation. I would like to get another one but the prices have shot up so quickly it will be hard to make the numbers work.
Oh and for those wondering we ended up using a management company. Its pricey but not dealing with the day to day has been worth it. We figure if we want to management it ourselves at any point we can make the switch but as of right now we don't plan on changing anything.
I'm going to be managing myself for now, but open to a management company depending on how much of a headache it is. What company did you end up going with?
Congrats. If you have the time and willingness managing it yourself it probably best but I've been happy being hands off. I went with Resort Rentals LLC which is ocvacations.com.
Where is it at in OC?
Let me know if you have any questions and I'll do my best to answer.
-Bill
Quote from @Bill Ames:Thanks Bill. It’s been a stressful couple days as August is filling up. Hopefully once I get through the initial bookings it’ll be smoother sailing.
@Dre N.
Congrats. If you have the time and willingness managing it yourself it probably best but I've been happy being hands off. I went with Resort Rentals LLC which is ocvacations.com.
Where is it at in OC?
Let me know if you have any questions and I'll do my best to answer.
-Bill
I’ve been a renter through Resort rentals so I’m familiar with them.
my property is on 58th street on the bayside. How about you?
Tagging: @Bill Ames @Bill Ames
Update August 2, 2022.
Wanted to give an update on what I have learned from my first summer without a rental company in Ocean City
A couple of things, we used Coastal rental last year and I think they charged us 12% which is low. But realized that they were changing the guest a fee as well. Coastal Rental was good to us and did a good job. So if you need to have a property management company, they will work.
However, if you want to self-manage and I would say is the best route to go. Mainly since my revenue shot up 45% and we don't have the 12% fee from the property management. So our net income went up a good amount. For our 3 bedroom/ 2 bath property, we are on target to hit $50k and maybe more depending if we get a September booking. Next year will aim for $55k. To give some context, with Coastal Rental last year, we made about $35k.
Below is what I learned which should help most of you increase revenue and also reduce work.
It's a good playbook and hoping to improve on it in the next few months.
1- Set up Airbnb/VRBO listing.
2- Get professional photos. There are several in the area.
I used www.SvetlanaLeahy.com
3- Hire someone from Fiverr to write a professional title/description for Airbnb. Which you can use for VRBO
I used: https://www.fiverr.com/andrewb...
4- Hire a cleaning staff. I found this great site that now does everything automatically for me at https://turnoverbnb.com/
I would interview 3 to 4 cleaners personally at the property. I can give you the cleaner that I'm using if you want their name
Basically, Turnoverbnb connects to your Airbnb and Vrbo calendar. You add a credit card to Turnoverbnb. And the rest is automated.
So the cleaning staff knows when the person leaves and cleans it and it's charged to your CC. You also get alerts on when they start and finish.
They also help with inventory and can do custom checklists. This alone has saved me a ton of time. It's been great. I wish they had it for my WV property :)
5- I use https://touchstay.com/ for my digital guidebook and it's worked really well. I used to have a paper version but this has helped a lot since I can change content pretty quickly
6- The remaining is communication with the guest which is vital, I have it automated through lodgix but that is a vacation rental management system that I tapped into through VRBO and Airbnb. That might be a bit too much setup for most people. Since it does reporting and other misc services. So I'm trying to locate a much easier service for people to use for communication.
7- This isn't needed. But since I'm a web developer, I created a website at https://pineapplebayoc.com/, if you know how to create a website. This is a good option to have. It adds some value but not a lot if you are not tech inclined or don't want to build a website.
8- Hire a good handyman. There are several in the area
9- Have a big owners closet to put extra items in it (i.e. hand/bath/dish towels, toilet paper, etc)
10. AND by far the best thing that has driven my revenue up is using https://hello.pricelabs.co/, it's a service that will connect to your VRBO and Airbnb and automatically adjust the price daily based on demand and supply. I just found out about this service this year. I wish I found it earlier. You put the lowest and highest price and pricelabs does the rest. To determine the low and high, you can either check out your competition through Airbnb or use https://www.airdna.co/ which shows what other XXbed/XXbath charges. One thing I will say is that Coastal rental price list that they sent us last summer, the highest price they had per day was $425. For this summer season, I increased that to $550 with a higher minimum and it worked well. Next week, I plan to increase that a bit higher for both min/max. Also, I do a 3-night minimum.
Hopefully, this helps any current or future rental owners. I will add more later.
I spend about 15 minutes a week managing the property
Quote from @Dre N.:
Quote from @Bill Ames:Thanks Bill. It’s been a stressful couple days as August is filling up. Hopefully once I get through the initial bookings it’ll be smoother sailing.
@Dre N.
Congrats. If you have the time and willingness managing it yourself it probably best but I've been happy being hands off. I went with Resort Rentals LLC which is ocvacations.com.
Where is it at in OC?
Let me know if you have any questions and I'll do my best to answer.
-Bill
I’ve been a renter through Resort rentals so I’m familiar with them.
my property is on 58th street on the bayside. How about you?
Next year will be even smoother and will start filling up earlier in the year. I'm 21st street bay side as well.
Quote from @Claudio Meira:
Tagging: @Bill Ames @Bill Ames
Update August 2, 2022.
Wanted to give an update on what I have learned from my first summer without a rental company in Ocean City
A couple of things, we used Coastal rental last year and I think they charged us 12% which is low. But realized that they were changing the guest a fee as well. Coastal Rental was good to us and did a good job. So if you need to have a property management company, they will work.
However, if you want to self-manage and I would say is the best route to go. Mainly since my revenue shot up 45% and we don't have the 12% fee from the property management. So our net income went up a good amount. For our 3 bedroom/ 2 bath property, we are on target to hit $50k and maybe more depending if we get a September booking. Next year will aim for $55k. To give some context, with Coastal Rental last year, we made about $35k.
Below is what I learned which should help most of you increase revenue and also reduce work.
It's a good playbook and hoping to improve on it in the next few months.
1- Set up Airbnb/VRBO listing.
2- Get professional photos. There are several in the area.
I used www.SvetlanaLeahy.com
3- Hire someone from Fiverr to write a professional title/description for Airbnb. Which you can use for VRBO
I used: https://www.fiverr.com/andrewb...
4- Hire a cleaning staff. I found this great site that now does everything automatically for me at https://turnoverbnb.com/
I would interview 3 to 4 cleaners personally at the property. I can give you the cleaner that I'm using if you want their name
Basically, Turnoverbnb connects to your Airbnb and Vrbo calendar. You add a credit card to Turnoverbnb. And the rest is automated.
So the cleaning staff knows when the person leaves and cleans it and it's charged to your CC. You also get alerts on when they start and finish.
They also help with inventory and can do custom checklists. This alone has saved me a ton of time. It's been great. I wish they had it for my WV property :)
5- I use https://touchstay.com/ for my digital guidebook and it's worked really well. I used to have a paper version but this has helped a lot since I can change content pretty quickly
6- The remaining is communication with the guest which is vital, I have it automated through lodgix but that is a vacation rental management system that I tapped into through VRBO and Airbnb. That might be a bit too much setup for most people. Since it does reporting and other misc services. So I'm trying to locate a much easier service for people to use for communication.
7- This isn't needed. But since I'm a web developer, I created a website at https://pineapplebayoc.com/, if you know how to create a website. This is a good option to have. It adds some value but not a lot if you are not tech inclined or don't want to build a website.
8- Hire a good handyman. There are several in the area
9- Have a big owners closet to put extra items in it (i.e. hand/bath/dish towels, toilet paper, etc)
10. AND by far the best thing that has driven my revenue up is using https://hello.pricelabs.co/, it's a service that will connect to your VRBO and Airbnb and automatically adjust the price daily based on demand and supply. I just found out about this service this year. I wish I found it earlier. You put the lowest and highest price and pricelabs does the rest. To determine the low and high, you can either check out your competition through Airbnb or use https://www.airdna.co/ which shows what other XXbed/XXbath charges. One thing I will say is that Coastal rental price list that they sent us last summer, the highest price they had per day was $425. For this summer season, I increased that to $550 with a higher minimum and it worked well. Next week, I plan to increase that a bit higher for both min/max. Also, I do a 3-night minimum.
Hopefully, this helps any current or future rental owners. I will add more later.
I spend about 15 minutes a week managing the property
Wow, so much good information. Thanks for sharing. You really sound like you know what you are doing and have implemented the tech the way we all plan to in our heads but never seem to do.
I know doing it our selves would net us a good chunk of change more. I've been busy with my day job and like that I don't have to think about it at all but may have to reconsider.
I wanted to give an update on my last post
Compared to 2021 when I had Coastal Rental management managing it. My revenue went up 30% this past summer (2022) which doesn't include the 12% that Coastal rental charged for their management.
Which is a sizable difference. Using the online system Pricelab which is linked here https://pricelabs.co/users/sig... was one of the main reasons for that. Additionally, it was able to get me some additional rentals in September which was a happy surprise. Highly recommend Pricelab and also turnoverbnb which automated the cleaning.
One thing I will mention is if you have a larger house and have room for additional entertainment. I recommend buying 1 to 2 Arcade1up game machines which can be bought from $300 to $500 and are very popular with kids. Specials can be seen here https://slickdeals.net/newsear... Pac-Man is probably the top one to get. I don't have room in my rental but for my WV rental. This has been a very popular entertainment option for kids and adults.