“You Must Take Personal Responsibility”

Those words have stuck with me.

I was a trainee lawyer and I was out of my depth. Something went wrong. I said it wasn’t my fault. But it was. It was my case – so my responsibility. And my supervisor told me so at my review. She told me I needed to take personal responsibility. Always.

I made a decision there and then to always take personal responsibility in everything I do. Even if I could point at someone else’s actions contributing to a problem, I always try to consider now whether I had done everything I could to mitigate it. The buck stops with me.

Vacation Rental Property Managers

This is also true in my Airbnb. If I hire a Vacation Rental Property Manager and they get something wrong, it is my guests and my property that are at risk – so it’s my duty to put things right.

Your Vacation Rental Property Manager won’t take personal responsibility. And nor should you expect them to. It’s not their name on the listing. They don’t own the title to the property. It’s not their reputation at stake.

The Buck Stops With YOU.

The reality is that even with a very good Vacation Rental Property Manager, your Airbnb will still require your attention. You won’t want to give carte blanche to someone else to make every decision on your behalf without consulting you first and so you will need to have input. Which begs the question;

Do I need a Vacation Rental Property Manager? Here’s a few things to consider:

The Pros

A good Vacation Rental Property Manager is great for dealing with guest queries. Or for calling a plumber during a leaking pipe emergency. They also know (or should know) the legal side of things. 

A good Vacation Rental Property Manager will have a long list of quality handymen, building contractors and electricians on hand when the need arises. If they are a big operation, they may be able to negotiate a better deal for you – since Vacation Rental Property Managers can send a lot of work their way, the contractors will sometimes be willing to work at a reduced rate and to prioritise your issue over other customers. 

The Cons

A bad Vacation Rental Property Manager will simply act as a message forwarding service – the guest has a problem, so they contact the Vacation Rental Property Manager; the Manager messages you about the problem; you decide how to solve the problem and direct the Property Manager on this. Its hard to see any value added here. But there is a bigger draw back still… 

They cut into your bottom line. 

Property Managers work on a percentage of the rent – often between 10% and 30% (or sometimes more). This extra cost can make all the difference between a positive and a negative cashflow and sink or swim the business – [see here for tips on how to improve your Airbnb cashflow]. At such a large margin, for a Property Manager to be worth their while they must really add some value.

DIY

So we come back to the question, do you really need a Vacation Rental Property Manager? Simply put, no. 

The reality is that the service that Vacation Rental Property Management companies offer does not free you from your obligations and responsibilities. So I would suggest you think about going it alone.  Consider these tips to help you automate your Airbnb to make it easier. I managed it from 4000 miles away, so I’m sure you can manage by yourself too.

If you decide a Property Management company IS what you need, make sure you set out in writing exactly what is expected of them. They will likely send you a contract to sign up to their services. Most people just sign this without reading it. Never do that. This contract is not set in stone. Everything in life is a negotiations, and this is especially true with a Vacation Rental Property Management contract. They want you business, after all.

Here are a few tips to help you strike the best deal when negotiating a Vacation Rental Property Management contract:

1. Haggle the percentage

Research what the various Vacation Rental Property Management companies in your area are charging. If one charges 20%, another comes in at 15%, and a third at 10%, call the first two and tell them you’ve received a quote of 10% and ask if they can match it. Often they will, as any percent is better than no contract at all.

However, bear in mind that the more you hammer them on costs, the less incentive they will have to actually work hard to keep your business. A balance needs to be struck here between getting the best price and getting the best service.

You stand a better chance of reducing their percentage if you want them to manage multiple vacation rentals for you, or one rental that will rent at a premium.

2. Consider the cancellation period 

If the service isn’t proving satisfactory, you want a way to walk away. Yet many Vacation Rental  Property Managers include a penalty for canceling the contract.

Better is to include a cancellation period. But you don’t want this period to be too long. Trust me, they will suddenly become a lot less interested in your property’s needs once you have served a cancellation notice, even though you are still paying them.

3. Remove limits on liability

Every Vacation Rental Property Management contract I have ever seen seeks to limit the liability of the Management Company if anything goes wrong. And by anything, I mean ANYTHING. Including where they are guilty of negligence. Why? Why should someone who acts negligently be able to get off scot free? I see no reason – they are claiming to be the professionals, so hold them to the standard they claim for themselves.

But never forget who the buck stops with. It stops with you.

Do you use a Property Manager, or do you prefer to go it alone? Let me know your thoughts in the comments below.