Investing in a business at any time, let alone during a global pandemic, can be a tricky proposition. There are many considerations—cash on hand for investing, your own business expertise, finding the right location, nailing down a solid business model, deciding whether to buy an existing business or starting up a new one, etc. These are just a few of the things that will keep you up at night deciding if you want to buy a business. And if you do buy a business, what business you should buy.
Buying into a national franchise can take some of the risk out of the venture but buying into a franchise can be expensive. And there’s no guarantee of success even with the franchise model as your guide.What About Real Estate?
Any time you can invest in real estate, you know that’s a proven way to make money. But investing in real estate is also expensive and doesn’t always create a stream of income. Because real estate is not a liquid asset, the only time you make money is when you sell. So, you have to buy and sell a lot of real estate in order to be profitable.
There is a way, however, to get into the real estate business without buying up lots of properties. Most real estate property owners don’t want to be involved in the day-to-day operations of being a landlord. So, they’ll hire a real estate property management company to take on the dirty work. With rents continuing to climb year after year, owning a property management company is a way to capitalize on the real estate market without making a huge investment.
But managing properties comes with its own set of headaches. Be prepared to deal with unhappy tenants, endless repairs, ongoing maintenance, building emergencies, inspections, and evictions.Real Estate Without the Expense or Annoyances
But what if you could take those headaches out of the equation? Have only happy tenants who never need eviction. Repairs and maintenance? Not on you.
If you’re interested in taking advantage of the exploding real estate market but don’t have millions of dollars to invest or don’t have the stomach for dealing with tenants, owners, and problems galore, add the word vacation to rental property management and you just might be in business.
Here’s why Vacation Rental Property Management (VRPM) is an excellent prospective business to buy into.10 Reasons Why Vacation Rental Property Management is a Good Value
1) Outstanding Market:
The vacation rental market is booming. According to ipropertymanagement.com, the vacation rental industry exceeded $87 billion dollars in 2019 with over 448 million users worldwide. In 2021, most of the vacation rental revenue will be generated in the United States (Statista.com), with one in four Americans engaging with short-term rental platforms (ipropertymanagement.com). These numbers are only expected to increase with covid-19 driving vacationers to want to stay in a more self-contained environment where they can eat, sleep, play and relax without coming into contact with hundreds of other people. A place where only their immediate family and close friends are hanging out too. Once people have experienced a short-term rental with all its conveniences and luxuries, many of them will never want to go back to staying in a 300 square foot hotel room again.2) Lower start-up costs:
Compared to the initial investment in other businesses, the initial investment in a VRPM company is relatively small. There is no inventory to purchase, nothing to store or ship, and in the case of VRPM there are no properties to acquire.3) Availability:
Nine million U.S. households own a second home, and 49% of those second homeowners plan to use it as a vacation home for their families (ipropertymanagement.com). Affluent people look for a place to invest their money and they often end up buying a second home in a highly desirable location. This serves two purposes: 1. They want a place to go when they vacation with their family and friends, usually one of their favorite vacation destinations. 2. They understand there is income opportunity in owning a second home because they can rent it out when it sits empty. In 2017, 25% of vacation homeowners rented out their property as a short-term rental (ipropertymanagement.com).4) Profit:
Vacation rental profits are high. In 2021, the average revenue per user (ARPU) in the Vacation Rentals segment is expected to hit $299.96 (Statista.com). The more desirable the location, the higher the short-term rental rate. The VRPM company can make anywhere from 10% to 50% of those profits (lodgify.com).5) Minimal Hassles:
Two of the highest costs and hassles of owning a vacation rental property are cleaning and maintenance. For vacation rental properties, however, the hassle and the costs of constant cleaning and regular maintenance are typically the responsibility of the homeowner. The homeowner establishes a rental rate that covers it, so the costs are passed along to the guests, not the management company.6) No Big Ongoing Expenses:
You will be making money off an asset that is bought, maintained, and insured by the homeowner, not you. You’ll pay none of the property taxes either.7) Low Overhead:
You typically don’t need a business storefront/check-in center until you have a lot of properties to manage. More properties to manage, however, means you’re making enough money to support a check-in center, so this could be a business goal.8) Liquidity:
Cash flow is good because non-refundable deposits are collected upfront, and the balance is usually payable before guests arrive. So, the money is in the bank before the key is ever turned on the property. 9) Accounting:
Because you collect all money due before the guests arrive, there are no accounts receivable. 10) Daily Operations:
Technology makes property management easier than ever before. Computer programs and chatbots help answer questions and take online reservations. Additionally, there are many avenues for advertising your business through email marketing, paid ads, integrating with online marketplaces, and more.A Profitable Opportunity Awaits
The travel industry is set to explode in the coming years, so now is an excellent time to invest. With a low initial investment and just a little bit of vacation savvy, you can make a good living working in a vacation destination. Whether in a ski area, at the beach, close to theme parks, in the mountains, near national parks, or locales off the beaten path, your lifestyle as a Vacation Rental Property Manager can be a dream come true.
If a VRPM opportunity sounds interesting to you, SkyRun Vacation Rentals
would like to talk to you. We are currently seeking highly qualified individuals to start SkyRun locations in any luxury vacation destination.
SkyRun is a full-service VRPM company that licenses its business to individual entrepreneurs and has been making vacation property ownership more profitable and hassle-free since 2004. SkyRun has been listed as one of the top 50 global companies
leading the way in Vacation Rental Property Management for 2021 (Rentals United.com).
if you’d like to know more.