Great Falls, VA · Member since 2016 · 6 posts · 0 votes
I was initially pleasantly surprised when I looked at the prices and gross rental revenues in Gatlinburg, TN for vacation rental properties. 20% ratios of rent/ asking price are not uncommon. When I dug deeper, I found out that property manage fees are a whopping 40%! That takes away all the profits. Property management firm claims high fees are justified because of high marketing costs and excellent service for tenants. Really? While I could probably find management firms with a 20% cost, I wonder how good their marketing will be? Outer Banks, NC have fees in the 14% range, and Florida Keys in the 10% range.
Involved In Real Estate · Half Moon Bay, CA · Member since 2014 · 17 posts · 34 votes
6y
I do long term rentals and still help with some family vacation rentals. I used to do more vacation rentals and enjoyed it, but decided at even 20% it wasn't worth my time. I have a hard time telling people no, but people that asked me to lower my vacation rental rates were so easy to say no thank you, click. Yes, it eats into your profits but a good manager will be doing a lot of work for you. Making sure place is cleaned, keeping visitor experience at 10 stars so they come back, getting the visitors in the first place, making sure everything is safe, neighbors are happy, county is happy(depending on vacation rental rules) (thats an important side note. alwasy make sure what the rules are where you buy. IE does manager or owner have to be in same town) etc. On the other side of things my mom in her 70s manages vacation rentals out of state and loves it (although she is starting to talk about slowing down) for her it's more fun meeting people and she doesn't really think of it as a job. If she looked at all the hours she spends, calls anytime of day etc she might realize a part time job at Starbucks paid as much and was easier work. I'm being a little sarcastic there as there are other perks to owning too. My basic point is that yes you can manage homes yourself, but it is a job, and you need to compare if you can make more money at another job, how fun it is, what our new current environment will be like after Covid 19 etc. Best of luck in your decision process and finding a great home!