- Which Services do Airbnb Management Companies Provide?
- What are the risks?
- Tips for Choosing the Best Airbnb Management Company
Managing your short-term rental property might be difficult, especially for aspiring entrepreneurs. Regular tasks become tedious and overwhelming, as their number is constantly growing and it is almost impossible to have everything pre-planned.
Here, it is almost the only option for the Airbnb host to ask for help from management companies. In the article, we will both review the services these companies provide and share some tips on making a proper choice.
Which Services do Airbnb Management Companies Provide?
The assortment of services provided by short-term rental management companies varies between different entities. Most of them provide multiple services at once, excluding the necessity of contacting different companies. In this section, we will review the services that are generally available in the market.
Improving Your Listing
The first group of services these companies provide can be implemented even before you accept your first guests, but it is also possible to implement them to improve an existing business. These services are aimed at improving your listing via different methods. First of all, some management companies are ready to send professional designers to your property in order to rearrange your furniture in the most efficient way.
Then, some of them are willing to send their photographers to create professional pictures of your Airbnb. Last but not least, the company could design the listing itself by selecting the best photographs and accurately configuring all the parameters. Even though the latter task is not so difficult, it is sometimes better to entrust an experienced team with it.
Licensing Your Business
This is another service that may be especially useful for aspiring hosts who haven’t managed a business before. Learning all the local laws may be difficult for people without legal education, so there is no surprise that many entrepreneurs fail to get their short-term rental business licensed on the first application.
Local management companies can be extremely helpful in that case. They will get you up to speed with all the regulations as well as help you create a proper application to get your Airbnb licensed in no time.
Managing the Listing
Managing your listing is perhaps one of the most time-consuming aspects of being a vacation rental business owner. You will have to constantly answer inquiries from potential guests, update your calendar on the site and leave reviews for guests who have already checked out. As you could have guessed, management companies are willing to take over these responsibilities.
From the host’s perspective, it is beneficial in two ways. First of all, it allows you to save a lot of time on tasks that you no longer have to perform. The time may be used to improve other aspects of your business or simply to have a break from being constantly involved in the process. Secondly, it guarantees a high level of quality of communication with the guests and eliminates the chances of mistakes you could have made yourself.
These companies employ professional agents who will be communicating with the visitors in the best way possible. In case you are failing to answer all the messages quickly or do not have much experience in customer relationship management, this service may dramatically improve the quality and therefore the performance of your Airbnb.
These companies will also update the calendar for you and use their experience to optimize the pricing of your property. As they are constantly operating with lots of properties, they know the local market conditions pretty well, allowing them to select the most optimal price for your Airbnb. They will also analyze the performance of your listing to adjust the prices if needed.
Managing the Property
The last group of services is surely the most useful for hosts who do not have any staff or team members. Managing the property on your own may be extremely time-consuming, as it requires you to perform tons of tasks on almost a daily basis. First of all, you have to manage check-ins and check-outs. Some management companies are willing to help you out here as well: they will pass the keys to the new guests and check the property once they leave.
The second necessary task relates to cleaning the premises. It is absolutely necessary to clean the property after each guest checks out, which is one of the most time-consuming tasks in the whole business. Even in case you are not planning to clean the property yourself, managing cleaning services might be tricky. You always have to control the schedule of cleaning, and updating it every day, and you cannot ever miss out on the procedure.
Management companies are also willing to cover these tasks. Typically, they have cleaners on staff or have partnerships with cleaning companies, allowing them to guarantee that your property will be maintained properly and all the procedures will be performed on time. Apart from cleaning, the service typically includes restocking all the necessary supplies, so that you won’t have to personally visit the apartment or house at all.
Some of them also offer technical maintenance services. This allows you to stop worrying about the security of your property, the safety of your guests, repairing house tech, and other aspects of maintaining your Airbnb. In some companies, the service even includes the emergency maintenance response feature. It implies that the company will be able to immediately send technical specialists, in case something goes wrong during the guests’ stay.
What are the risks?
Of course, there are some downsides to getting such services. In this section, we will review all the main risks associated with Airbnb management companies, hopefully allowing you to make an informed decision on whether or not you should opt-in.
The first risk you bear when choosing a management company relates to the potential financial losses such a partnership may result in. The services of such companies are paid, so even in case they will manage to improve the performance of your Airbnb, you are not guaranteed to have a profitable business. Typically, the more services you choose to use, the lower your chance of breaking even is.
Even in case you are profitable, you will be giving part of your revenues to the company, reducing your net performance. This point is individual for each case, as sometimes, the managers may add more value than they cost. The good news is that with most Airbnb managers, it is possible to rearrange your agreement. In case your Airbnb is not profitable, you will be able to re-configure the services you use to optimize the results.
Hosts with no experience can also have the risk of choosing the wrong packages of services. Some aspiring entrepreneurs overpay for the most expensive options, whereas there could be some tasks they could have easily performed themselves.
Bad Management Risks
The second group of risks associated with hiring a company relates to choosing a bad one. In case the company you have selected is not coping well with its objectives, it may cause devastating damages to your business, especially, in case you are only starting your operation.
First of all, with a bad company, the financial risks mentioned above are doubled. You won’t receive the revenues that might be vital in the initial stages of building a successful business. It may be even more damaging, in case you have to pay loans for your property.
Secondly, in case the service of the management company is bad, you will likely receive negative reviews. Reputation is everything on Airbnb, and getting low ratings from the first guests may cause irreparable damages and completely change the course of your future interactions on the platform.
Last but not least, it might be difficult to react to issues immediately. Some companies take over your account, which makes it tricky to implement immediate changes to the listing or track their communications.
Tips for Choosing the Best Airbnb Management Company
The risks that we have mentioned in the previous section can be hedged by implementing some tips that we are going to share now. Following all of them will reduce the risks of choosing a bad company to a minimum. We have also included some tips on how to choose the correct plans of services, which is also important for every management company.
1. Find several companies
The first thing you need to do when looking for a management company is to find multiple of those. It will allow you to compare them, making it easier to distinguish bad managers from decent ones. Moreover, by checking out different companies, you will learn more about the types of services that are available in your area.
2. Check the reviews
In most cases, you will be able to find these companies on independent review platforms. There, you will find unbiased opinions of other hosts who have chosen to purchase the services. Use this step as a filter for the companies you have found before: just delete ones with bad reviews from your list.
3. Learn more
Discovering additional information about the company is always a smart thing to do. Firstly, you can investigate the examples of listings they manage, but it’s important to take them with a grain of salt. A management company would logically show off its best listings.
Secondly, you can investigate the general experience of the company. Find out how many listings it manages and draw the corresponding conclusions. Managers with histories of less than a hundred listings are not necessarily bad, but it is always better to choose more experienced and reliable companies.
You should also know that short-term rental business conditions vary dramatically in different regions. Thus, it is always a huge benefit if the company has significant experience in your specific region or area. Not only does it mean they know all the corresponding legislation, but also the seasonality of business in your area and other parameters that may affect the business decisions.
4. Choose the services smartly
Another important aspect of choosing the best Airbnb management company relates to analyzing the services it offers properly. At this point, in case you have been following the previous tips, you have filtered out several companies with positive reviews and large experience in the industry. Now, it is time to compare the services they offer to make an optimal choice.
First of all, it is important to set priorities for the services you could need. Determine, which of them are absolutely necessary for your business, then, select the ones it would be good to have and the ones you do not want.
Then, you should compare packages of services offered by different companies to find ones that have everything you need and come at the lowest price. It might be a bit time-consuming, but it will surely be worth it in the long run.
5. Try individual plans
Some management enterprises also have individual plans instead of offering their services in packages. Here, the best option would be to calculate the total costs of services you need on the sites of different managers to compare them to each other. Even if there are only packages listed, sometimes, it is possible to contact the manager and arrange a customized plan.
6. Start small
To become a successful entrepreneur, it is also crucial to understand how the business works. It would be impossible without actively participating in each stage of the project, which is sometimes impossible with management companies. It is not always better to outsource everything to a management company, as you won’t be able to run the business without it later.
The best option would be to establish a successful business first and only then start giving away the most tedious tasks. However, some services like licensing help and listing improvement might be beneficial right away, as they are one-time procedures that will help your enterprise get going.
Moreover, it is always a nice decision to set up a trial period. When signing an agreement, make sure not to go long-term right away. Try the set of services you have chosen for a month and draw the conclusions then. Thus, you will be able to adjust your plan by adding some additional features, removing the features you haven’t enjoyed, or even switching to a whole new management company.
7. Feel free to get consulted
Communication with your management company is extremely important during the operation, so it is always nice to contact it beforehand and analyze the response. In case you’re unsure about the plan, you can even ask the company to help you pick the necessary services. Decent managers are always eager to create win-win relationships with Airbnb hosts, so they will surely help you out. In case you see the manager trying to offer you as many services as possible, it is already a bad sign.