@Michael H. , as long as you are aware of all the responsibilities involved and are getting paid somewhere in the 20-30% of revenue range for your services then it's really up to you. It's NOTHING like managing a regular rental however, it's a completely different business model that is more hotel-centric in ADDITION to normal property management. Ask them for their annual revenue and figure out if the dollar amount is worth your time and efforts...if it's a busy place, it will a substantial amount of time and energy. ;-)
Best of luck!
I have 22 STRs about 2.5 hours south of you in Coffeyville. 99% of the people I rent to are refinery contractors with a per diem. Half my houses are 2 BR, and they are easy as pie to rent out. 3 & 4 BRs are harder to rent out, but they generate more money when they are rented. My biggest house is a 3 story, 4 bath house with 9 beds. Finding a group of 5, 6, 7 or 8 guys that work together and can stay in the house together is difficult. But this house brings in the most money per week out of all 22. All 22 houses make about the same amount of money each year.
My point being, you're going to have a hard time renting out the big house to one group. You might be better off renting out individual bedrooms in the house to people working at the same project.
How much to charge? My rule of thumb is that 7 days of rent should pay the utilities for the entire house when it is completely occupied for a month. Days 8-31 are your profit and what you save for repairs and property taxes. So figure out what the gas, electric, water and cable bill will be; then boost it by 25% because people leave lights and tvs on. That dollar amount should be what the house brings in each week if it's fully occupied.
My other rule of thumb is to see how much an average motel room with 2 beds is for a week in your area. That price/2 is how much you charge per bedroom.
I'll guess you are going to charge between $200 to $240 a week per bedroom using the above 2 rules of thumb.
I say definitely do it. Charge the owner 20-30% of the income. I have a larger house as well and I agree that they are a bit harder to get rented, but they do very well. I ended up putting my large house with Evolve Vacation Network. They charge 13%, so you could pocket the rest. If you have never rented out short-term, this is the way to go since they will create the listing for you and manage it.
@Michael H. Have the owners been using it as a short-term rental up until now, or has it been their primary residence? The reason I'm asking is to find out if they have a rental history and possibly a return clientele, or if you'd be building the business from scratch.
If the former, then I'd say have a good conversation with them about how the manage it themselves - emulate their model and improve on it where it's warranted. Use their same people to clean, do maintenance, yard work, etc. Then I think you'd be stepping into a relatively straightforward situation - it IS still work, and different work from standard property management, but once you were set up then mostly you'd be doing guest communication and coordinating with your support team. I agree with those who say you'd want to charge 20-30% gross rents for your services.
If they haven't used that property for STR before, you have a MUCH bigger job in front of you - you'd need to do research to find out how viable it would be to rent such a large property in that area (could you do events there? It might be a great site for private parties or weddings, etc - and I'm not suggesting you coordinate any of those things, but people could rent the property and bring their own vendors, etc. But make sure it's permitted - in an affluent neighborhood I bet it's not). Your target market is vastly different from @Paul Sandhu 's but he's right that it will be more difficult to rent such a large property. It may very well be profitable to do so, you'll be getting $$$$$ for fewer nights vs. $ or $$ for more nights, but take that into consideration.
Let us know if there's established rental history or not and we'll go from there. :)
Make sure you get over 20%, it is a ton of work!
@Michael H. - I would talk to local VR hosts and check AirDnA.co to find out: How well does the location lend itself to VRs? Who are the top VR hosts in the area? This data is readily available for probably $30-$40.
Very good points brought up about historical revenues and any existing clientele for repeat business. In addition, I would consider splitting it up into multiple VR units (i.e. house and cabin separate since you usually make more money and have more flexibility this way). Finally, consider your target market and your minimum stay: can the location be rented for 30+ days to business travelers on assignment in KC? If so, this can be much more passively than truly short-term VRs--more like traditional property management, whereby you would sacrifice some margin in exchange for some freedom.
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