How to Determine Your Vacation Home Rental Price
You don’t need to be an expert to know how much to charge your vacation home!
More and more people are investing in putting up second homes to function as income-earning vacation rental places. When managed and marketed well enough, this is one of the best investments there is around.
Newbies to this kind of investment often find themselves in a common dilemma: how much should they charge for their vacation homes as rental fee? What are good indicators of prices? How do you make sure you are getting your property’s worth without so much as overpricing?
Here are three things that you should consider when deciding on the price of your vacation rental place: location, amenities, and competition.
How popular is your vacation home’s location to tourists? What are the top tourist destinations in your area? Are the tourist attractions seasonal – like ski mountains or surfing areas that open only a few months a year? Or are these places like Florida or California that are mostly open year-round?
Moreover, how far is your vacation rental from key attractions in your area? How safe is your place? How accessible is the main road and public transportation from where your vacation rental is located?
The more tourist-y your city is, and the more conveniently located you are to the tourist attractions, the better price you can put on your place. I found this information very true-- I have been living in KL for so long and I know for a fact that Kuala Lumpur and Bangsar both have a huge demand for home vacation rentals. In fact, my favorite Bangsar property has doubled its sales price ever since the huge tourist rate increase in Malaysia back in 2010. I guess it's just obvious.
This category goes beyond the amenities and facilities available in your home actually. This encompasses all the characters that make up the house. How big is your vacation rental property? How many rooms does it have? Does it have a garage and a basement? Does it have good heating/AC? Does it have a pool/Jacuzzi? What makes it special and a standout? What services do you offer? Can they rent a car from you? Can they take their pets or do you offer cleaning services? Do you offer laundry services? What sort of electronics and home appliances are available for use in the vacation rental property?
This is among the first and most important things to consider when determining your vacation rental fee. Check around vacation rental places in your area and compare the prices as well as amenities and location of your competition. This will give you a base market rental fee. Check out the rates of the local hotels as well, especially when you’re trying to determine nightly rates for your rental place.
Once you’ve determined the base rental fee for your vacation rental place, you can now more easily make adjustments for seasonal price changes, and weekly, daily or monthly rates as well. To make these adjustments, the seasons are a huge factor. Don’t hesitate raising your rental fees – albeit reasonably – for peak season months and holidays. And just as well, reduce your fees to about 30-40% of the original price during mid or low seasons in your area too. Team up with local businesses, as Bankrate advised on this article-- you can always do good with a little help. That figured out, you can now easily market your vacation rental place in credible online platforms and keep the business going!