Hi Jeff,
There are a lot of good responses here, so I'll see if I can add any additional insight.
My wife and I live on an island in WA state and own 12 VR units, plus residential and commercial units as well. So I feel like we know a little bit about the industry.
The first thing I'd caution is that VR is not the magic bullet many believe it to be. It's more a question of function. Are you looking for a way to pay for a personal vacation home or are you looking for income generation?
Consider: VR income is federally taxed as ordinary income, including payment of self-employment tax. Our municipality adds lodging tax on top of state sales tax. Plus annual business licenses and inspection fees...All these are additional expenses.
Then, you must furnish (re-furnish as well), pay for all utilities, TV, and internet. Management fees (which you should calculate regardless of whether you self-manage it or not) of typical 35% vs. 10%, 3% to airbnb or some credit card processor and possibly the time and expense of a website.
Have I scared you off yet? Where I live, all my VR income must occur between mid-May and the end of Sept. which means you float it for the vacant months (I put in a month to month winter tenant if I can get one).
Nevertheless, I own 12 of them so I must think it works! And it does, but zoning limits my competition and I am in a tourist destination (p.s. Marriott has not quit!). Plus I was able to buy at such a bargain that the numbers were favorable.
If your goal is purely income-generation, or you're located in a convention city or a place where people vacation year-round, the numbers quite often favor residential rental. It doesn't mean you don't want to own a get-away that pays for itself. Just be honest with yourself about your goals and desires and make it as owner-friendly (and inexpensive) as possible