This piece originally appeared in a different form in our friend Vacation Rental Matt's blog:
Have you ever wondered how so many property owners and property managers have succeeded in the vacation rental business without any intentional plan to do so and without relevant training? As you'll read here, most participants in the vacation rental industry have surprisingly spontaneous stories as to how they got started.
While most owners begin renting for different reasons, as the featured owner stories below reveal, it appears that the successful ones all eventually develop a plan of action, even if they lacked one initially. This article discusses the elements that will help you grow your vacation rental business and also highlights two particular vacation rental success stories that we can learn from and take inspiration from.
Create Your Vacation Rental Success
As mentioned, many homeowners begin their journey managing their vacation rental without a solid plan. In The Innovator’s Solution, one of my favorite books, authors Christensen and Raynor walk readers through the business decisions crucial to achieving disruptive growth: something owners can certainly learn from. Their advice highlights three topics that will help you get on the fast-track to success in the competitive vacation rental industry.
1. Resources: The most tangible of the three pillars, resources describe the physical factors, like the property itself, the people running the VR business, the technology used, the guests booking it, and the financial resources available.
- Tip for Owners: To add value to your property, enhance your property's curb appeal and add popular amenities.
2. Processes: The processes are the patterns of interaction, coordination, communication and decision-making. One such example is the management of bookings and inquiries.
- Tip for Owners: To ensure guest satisfaction, thoughtfully communicate with guests before and throughout their reservation.
3. Values: Values represent the goals and judgment used to make decisions that inevitably affect success.
VR Owner Success Stories
Bonnie Gerow: Risk Taker Turned Business Owner
Take the example of Bonnie Gerow, whose journey began with the desire to own a retirement home in Grand Cayman.
Despite her husband, who didn’t want strangers “touching his stuff,” Bonnie decided to purchase a home to be rented out. Renting our her property gave her the opportunity to earn money to cover utility fees and also ensured that her property would not be left empty.
Her spontaneous decision to manage a rental literally paid off, as it became a thriving business. Bonnie's vacation rental success convinced her to buy a second home down the street, which she also rents to guests- and she's not stopping! Bonnie plans to purchase a third property when she formally retires: “It’s a full time job…but we love it and have discovered our passion and now know what we will do when we retire.”
George Carr: Accidental Rental Pro
George Carr, a former corporate lawyer, purchased a home in the foothills of the Appalachian Mountains with the intention of fixing it up and flipping it for a quick profit. By the time he had renovated his property, however, the recession had hit and he could not sell it.
Trying to make the most of the situation, George spoke to a real estate agent, who suggested that he rent out the newly improved home as a long term rental. George however was motivated to rent it out as a vacation rental.
George prepared to rent his property. After launching a website to market his home and listing it on the major vacation rental sites, George's business took off. He even bought two more homes to rent out, which together with his first property make up Cave Hill Cabins in Adams County, Ohio.
Mr. Carr admits to his spontaneous success: “The whole process was totally unplanned, serendipitous and accidental. As a lawyer I turned out to be a good carpenter and better vacation rental host. Who knew?”
George’s Vacation Rental Transformation
Bonnie and George are just two examples of the many industry novices who achieve success. Having interacted with hundreds of people with similar stories personally, I know that an unusually high number of today’s vacation rental professionals stumbled into the business. Their stories demonstrate that with good vacation rental planning, property owners with no business plan and no loans.