We have had great success with AirBnB and VRBO this past summer. We manage one vacation rental full-time, and are remodeling another unit by next summer to function as a vacation rental. My market is seasonal, but I operate full-time, and do well. I am also legal in my area, which gives me a leg up in terms of advertising. MANY others are not legal in my town, and try to hide their rentals from the city.
To try to touch on some of the questions here, I'll just give a broad explanation to the many questions in this thread.
1. Managing your property yourself will make you FAR more money (about 30% more). You will benefit from the cleaning fees, and other fees from the internet booking sites. You need to have excellent reviews, and a PM just will not care as much about your property as you do.
2. You need to have those 5 star reviews. When we first started, our price just couldn't be beat, but we had some VERY skeptical first bookings... It was tough. You are competing with other properties with 5 star reviews. Make sure you focus on customer service, as this level of real estate is way more customer service oriented than what a traditional PM will offer you.
3. You definitely want to have your property on AirBnB or VRBO rather than directly marketing yourself. Let me explain what I've been through thus far. So 100% of our bookings are from VRBO and AirBnB (30:70% respectively). I do maintain a professional website, where a customer can go and learn just about anything about my property, and view open dates and even link to a booking page. To promote this site, I spent about $600 on Google Adwords, and did a great job with SEO. I got thousands of hits, but not one booking! I would suggest using the power of SEO through AirBnB and VRBO. They spend millions of dollars on SEO, and marketing, and they are trusted. Just my 5 cents.
4. If you hire a PM, you will make far less money, and have reviews which are lacking. With that said, we reaaaallly need a vacation. It has been non-stop for us since last May, and we are pretty booked up for winter. Next summer we will have two units, and will need to hire a full time cleaner. This leaves no time for relaxation and rest, even though we work from home! Subsequently, we have checked out our options, and we have come up with 2 ways to have our property managed right, while going away for extended periods of time. One option is to have someone other vacation property owner stay in your home, while you stay in theirs. There's actually websites out there where people make arrangements like this. This is what we will do, but is not applicable to the investors out there looking for a hands off approach. The other approach is to have a caretaker. Either let them live in one unit, or build an ADU or set aside a bedroom for a caretaker. Many people will do this for very little compensation, or for free in exchange for room in some markets. I'm all about PM companies in some situations, but I don't think a vacation rental will shine unless a company which specializes in these types of properties is hired. And then be ready to see your profit just dwindle away... They just never seem to be able to get 80-100% occupancy.
5. There is way more maintenance than you would imagine. We just remodeled our vacation rental last spring, and it needs new paint, and new entry floor already. I'm also constantly dealing with either ice and snow in the winter, or landscaping during the rest of the year. This is in fact another home, and that is how it is advertised, and so that is what the customer expects. If you don't already own a home, you will shocked at how much maintenance is needed. If you don't learn this yourself, and then hire a PM to manage it, don't expect to make any money. The only time I hire someone is when I need electrical or something dangerous done.
6. There's two basic ways to manage your vaca rental. One is like a mom-and-pop deal. This is how we run our place (although I am a full-time real estate agent and investor). It is a lot of work, and a way of life. I do still have time for real estate sales, but I would never be able to hold a full-time job and do this at the same time. Certain jobs will mesh very well with this lifestyle. I think any work from home job where you set your own hours will be an awesome match with this lifestyle. If you have to be at your job in a set schedule, it may not work for you, because we've had things pop up at all hours of the day.
The other way to run it, is to get it managed, and just be totally hands off. I talked about that above, so you can read that again to get an idea of what it's like.
7. The pay is excellent. If you're in the right market, you will be able to make a living from this. You also get to stay home with your family, which I will be forever grateful for. It is wonderful to not pay for childcare, be at home with your kids, and be able to stay on top of all projects around the house. Do not expect a moment's rest though. If you had some sort of romantic notion about doing this for a living, dispel that right now. A good cleaner friend is a huge advantage! It can be grimy sometimes, and at other times you will need to have a thick skin when dealing with renters. As a landlord for 10 years and property manager for 20, this is nothing like either of those two ways of real estate management. Much more customer service oriented.
Hope that helps!
I'm anxious to hear from folks who've had personal hands on experience with both. We will be expanding our vacation propertyportfolio and are curious to know which may be the better choice for the quality of clientele/guests, ROI and ease of managing.