7 Steps to Market Your Extra Space as a Vacation Rental
When my husband and I purchased our Manhattan condo, it was important for us to buy a two-bedroom.
Not only does the spare room encourage friends and family to visit more often — they don’t have to spring for an expensive hotel — but it also has become an extra source of income because, when it’s vacant, we rent it out to tourists who are seeking lower-cost accommodations with friendly locals.
For the past two-and-a-half years, we’ve welcomed into our home travelers from all over the world for a reasonable nightly rate. We’ve made great friends along the way, for sure, but we’ve managed to make a decent amount of money, too. Enough, in fact, to seriously offset our monthly mortgage payment. Check out this recent post to find out about some of the room-rental services we use — and exactly how much we’ve pocketed. (See also: 6 Weird Things People Sell for Cash)
Simply listing your property on sites like Airbnb and Roomorama, however, isn’t going to make your side business a success. There are other aspects that require fine-tuning to make this situation work to your advantage. The way I see it, there are more than 4,000 other entrepreneurial folks in NYC doing the same thing we are (though that will soon change due to a newly passed law), and I want to ensure that our guest bedroom is filled with paying customers as often as possible.
If you have extra space and live in an area conducive to travel or tourism, I highly recommend hosting travelers. To give you an edge over the competition, here are seven criteria to keep in mind for maximum results.
1. List Your Property on Travel Sites
When we first started this little business, we were strictly listing in the Vacation Rentals section on Craigslist. The geniuses (and I mean that wholeheartedly; they’re brilliant) at Airbnb contacted us after the site’s launch in 2008 and invited us to list with them. We continued with Craigslist but also took Airbnb up on its offer. Business increased dramatically. Then Roomorama, a similarly modeled site, debuted, and we took advantage by listing there, too.
Listing on three sites is certainly a lot to manage — especially in making sure that we’re not double booking (I’ve never had it happen, knock on wood) — but it means thrice the exposure. The travelers looking on Craigslist may not be on Airbnb or Roomorama, and vice versa. The best thing about Craigslist is that we receive the full amount of the rental, whereas with the other sites you pay a percentage of the rental as a listing fee. But the fee is so low — and we raise the rent on those sites a tad to make up for it — that it’s inconsequential. The popularity and power of Airbnb and Roomorama within the marketplace is so incredible, too, that our inquiries from Craigslist have significantly reduced. And I’m OK with that. Airbnb and Roomorama have many more advantages — automatic calendar updating, a photo portfolio for your listing, and direct deposit — that make this opportunity both manageable, fun, and financially rewarding.
2. Market Your Home as a Destination
There are an incredible amount of listings on the vacation rental sites, especially in well-visited cities, and to pique a traveler’s interest, you have to offer amenities. Our unit features an in-unit washer/dryer, HD cable, DVD players, and a LCD TV in both the living area and guest bedroom. We offer a mini-fridge stocked with simple breakfast items and snacks and a Keurig single-cup coffee maker in the private room. We have fresh Ralph Lauren towels, a Wii and Xbox 360, among other enticing items, which are all inclusive. These are perks that people want — they make their stay more luxurious and enjoyable — and they’re items that help the traveler choose us over another host offering less. In this business, the little things go a long way.
3. Write an Engaging, Entertaining Ad
Staying with strangers can be a precarious predicament, because you never really know who’s on the other side of the door. Even before the advent of the vacation-rental sites, I had written an ad for Craigslist that aimed to give the traveler an idea of who we are in a funny and charming way. Our guests have told us that the quality of our ad single-handedly sold them on the idea of booking with us. You can judge our ad for yourself.
4. Vet Your Guests Before They Book
This tip ties in with writing an engaging, entertaining ad because 9 times out of 10, it’s conducive to conversation. My ad has motivated innumerable interested travelers to send me messages about how funny a certain part is, or how much they can’t wait to play Wii with us. With their response, they generally open up about themselves as well. From my end, it’s very important that travelers send messages that give me a little insight into the kind of people they are. If I receive a bland message that says simply, “How much per night?” or something with an equitable lack of personality, I delete it. A certain measure of caution must be taken when welcoming strangers to stay in your home, and the more I know about the travelers before they arrive, the safer I sleep at night.
Truth be told, there have been times that I have accepted bookings without really getting to know the traveler on the surface beforehand — and those folks, consistently, have been weirdos. Since then, I’ve learned to trust my gut. If someone seems shady via email, they’re probably much worse in person. That said, 99% of our guests have been an absolute pleasure to host; the weirdos are far and few between.
5. Keep Competitive, Affordable Rates
Rental rates will vary city-to-city, neighborhood-to-neighborhood. For instance, we live in Harlem and charge $90 per night during peak travel months ($110-$125 a night on holidays) while hosts in more desirable areas, like Chelsea, demand upwards of $200 per night — and if you can believe it, with far fewer amenities than we offer.
I can’t compete with the units in the more convenient midtown and downtown areas, because if travelers have made up their minds about what area in which they want to stay, there’s little I can do to change that. Rather, I’m targeting the folks who want an excellent experience at a rate they can afford who are open to exploring new neighborhoods. With that comes the responsibility of researching similar accommodations in my area to guarantee that I’m undercutting the competition. The whole point of this venture is to book my guest room, and if it’s empty, I’m not doing my job. My number-one rule of thumb when it comes to the nightly fee is that I will reduce it to fit travelers’ budgets. For instance, during the slow winter months, typically January 3 to March 30, I lower the rate to $70 nightly. Still, I would gladly slash that rate in half rather than let the room stay vacant. $35 per night is better than nothing at all, in my opinion.
6. Provide a High Level of Hospitality
A big part of any business is repeat customers and referrals. Those play a part here too, but so do reviews and ratings on the vacation-rental sites. It is extremely important to me to provide my guests with the best experience possible — from clean linens and towels (and an immaculately kept home overall), to suggestions on where to eat and drink, to helping guests carry their bags if needed. When their stay is over I want them to feel like they got their money’s worth, made new friends, enjoyed their vacation, and want to leave an excellent review. Other potential guests will read that review before deciding whether or not to stay with us, so it’s a critical part of the process. The bottom line is that bad reviews will shut us down quickly. Luckily, all of our reviews are positive, which is a testament (and a source of pride) to the level of hospitality that we provide.
7. Ask for Feedback About the Experience
Ratings and reviews are one thing, but guests don’t often go into detail, especially if they’re leaving positive feedback. Still, that doesn’t mean that there aren’t areas of improvement to make the guests’ stay even better. I often ask our guests what they liked or didn't like about their stays, and I use their feedback to enhance the experience. Admittedly, though, that method can be off-putting, because guests don’t want to hurt your feelings while you’re standing in front of them, even if it's the smallest suggestion. To get more honest feedback, consider creating a suggestion box or feedback form that the guest can fill out upon departure. It lets them off the hook since you’re not in their face, and it will give you real information that you can use to be the best host you can be.
Do you host travelers to make extra money? What sites do you use? How have you fared? Feel free to tell me about your experiences — and provide additional tips — in the comments section below.