How to run your vacation rental like a business

There are a ton of compelling upsides to owning a vacation rental (hello, future nest egg and extra income). But the truth remains—it’s a lot of hard work. We should know. We currently manage tens of thousands of vacation homes throughout North America, Costa Rica, and Belize. When you want to get serious about running your vacation rental like a business, be prepared for what’s ahead. Most of your time will be spent on the nitty gritty business tasks, like sending out marketing emails, juggling reservations, changing rates on all your marketing channels, and lining up housekeepers and maintenance vendors. 

It can get overwhelming, fast. So, we’re here to help break it down for you. Here’s what it takes to run your vacation rental to be a profitable business:

1. Check out the competition

Start with finding out what your vacation home is up against. Which vacation rentals are similar to yours in the area? How do they decorate and what unique amenities do they offer? What are their rates at various times of year? What do their guests like and what do they complain about? Scoping out the competition is one of the smartest ways to gather intelligence on what visitors want, what to charge, and how to stand out.

2. Know the local short-term rental rules, regulations, and tax requirements

As the popularity of vacation rentals grows, so too does the number of short-term rental regulations around the country. From Maine to Maui, your local legislature (city, county, state, or all three) will continue to have a say in how you own and operate a vacation rental. Some places require business licenses. Some collect higher property taxes. Others demand you collect a lodging tax per booking. Stay up to date with all the regulations and rules governing your rental, so you can run it both profitably and legally. 

To make things easier, Vacasa has local staff in all of our markets who can assist you with staying in compliance.

3. Get smart about setting nightly rates

The most common (and costly) mistake vacation home owners make? Charging static rates throughout the year. Also a big no-no: creating rates solely based on season. To earn the maximum profit, you should set nightly rates based on several factors, including demand, competition, events, weather, and even recent trends. 

These can change by the day. That’s why vacation rental property managers, like Vacasa, leverage a ton of data points like these to automatically adjust daily rates accordingly to compete. This is called dynamic pricing. The method makes sure you are earning top dollar on every reservation at any given time. 

How dynamic pricing helps you earn more >

4. Stock your vacation rental with what guests need and want

Anticipate what your guests will look for and provide it for them. Start with the essentials—the non-negotiable items every modern traveler expects, like reliable WiFi, paper towels, fresh sheets, and a coffee maker. Then, invest in extra amenities to take your home from so-so to something worth booking. Base this on where you’re located and who’s likely to book. For instance, to attract more families, offer items like high chairs, play pens, and break-resistant dinnerware. Or, purchase beach chairs, beach towels, and boogie boards for guests to use while staying at your beach house. 

The ultimate inventory checklist for vacation rentals >

5. Work to get 5-star guest reviews

High guest satisfaction is vital to your success. The battle for bookings can get fierce, and having better guest reviews can make all the difference in convincing someone to book your home over another. Plus, a consistent track record of good reviews can bring you better visibility on Airbnb. So, don’t leave these reviews up to chance (or up to the guest to remember to leave a review in the first place). 

You can start working toward great reviews by intentionally setting guests’ expectations and being fully transparent in your listings. Plus, check in with guests during their stay so you still have time to remedy any issues. 

5 expert tactics to get 5-star reviews >

How to respond to a bad review >

6. Design and decorate your vacation home to outperform

Design can make a difference—a massive difference. Not only can great design catch someone’s eye (and hold it), it can impact your number of bookings and how much money you can make. After all, today’s guests are willing to pay more for sophisticated and appealing interiors versus a home filled with a hodgepodge of used furniture.

Compared to similar homes in the same market, with elevated design captue:

• 116% more unique views of their listing
• 73% more revenue per available night
• 51% more nights booked

Designing with the aim to boost bookings takes more than just pretty patterns and colors. You have to consider who you’re designing for, anticipate how guests will use your space, select durable materials that can withstand multiple uses, and stay away from outdated trends (ahem, matching furniture sets).

How to furnish a vacation rental like an interior designer >

7. Invest in professional vacation rental photos

Flattering vacation rental photos are a bare-minimum requirement for success. Not only are they vital for compelling someone to click on your home’s listing, but you’ll need those photos for all your other marketing activities, like emails and social media posts. So, make them too good to ignore. Hire a professional photographer (preferably one skilled at shooting real estate or interior design) who understands the right angles, lighting, and details that appeal to potential guests. 

If Vacasa manages your home, we do a comprehensive professional photo shoot of your entire home (at no extra cost) even before you get your first booking. 

15 vacation rental photography tips >

8. Write rental descriptions that show and sell

While attractive photos can grab a traveler’s attention, it’s a compelling description that will hold it. The best vacation rental listing descriptions sell the positives of the guest experience with full transparency, essentially gaining trust, building excitement, and closing the deal. Some ways to do that: showcase your home’s unique traits upfront, make your headline count, and speak directly to what visitors to your destination want. 

How to write persuasive listing descriptions >

9. Don’t stick to one channel

The more places you are, the more possible views and bookings you can get. Once you create that perfect listing for your vacation rental, post it on multiple listing sites, like Airbnb, Vrbo, and Booking.com. You’ll get a ton more visibility, but there’s a downside. You’ll now have to juggle different calendars, content updates, rates, log-ins, and reservation requests. Unless you’re an eagle-eyed record keeper and like to be on your computer all day long, the smartest solution is to work with a channel manager who can sync all of your online listings, as well as optimize them throughout the year.  

That’s what Vacasa does, plus we go several steps further. We’ve established tight-knit partnerships with top channels (like Airbnb and Vrbo), so our homes are often listed at the top of search results and receive guaranteed dedicated support. 

Where to list your vacation rental property online >

10. Continuously market for maximum exposure

Vacation rentals aren’t a one-and-done business. The most successful vacation home owners market their rentals all year long. The aim? To get as much visibility as possible to fill up the calendar. The key is to take a multi-pronged approach to marketing. This includes email marketing (including monthly newsletters and timed emails to past guests), search engine optimization (effectively using keywords that help you get discovered online), and social media marketing (using social media accounts to engage with followers and potential guests). 

When marketing gets too overwhelming, many homeowners turn to vacation rental managers to bring their homes more visibility on their behalf. Vacasa deploys year-round digital marketing to keep your property top-of-mind, from frequent emails to social media advertising to fresh blog content promoting our vacation destinations. 

How to market your vacation rental property >

11. Hire professional house cleaners 

Unless you enjoy meticulously cleaning your vacation home multiple times a month, professional housekeeping is something you can’t skimp on. An immaculate vacation home is essential to today’s travelers. It tells guests that your vacation rental is not just sanitized, but safe. They’ll notice if your vacation home isn’t thoroughly clean, which could possibly lead to a bad review and cost you future business. 

Hiring a cleaning crew will also give you a leg up on the competition. Most vacation rentals are individually owned, without a professional cleaning staff. (Vacasa is one of the few vacation rental management companies in North America that employs housekeepers.) Follow this vacation rental cleaning checklist to make your home as pristine as possible after every guest stay.

Expert cleaning tips from Vacasa housekeepers >

12. Work with an experienced vacation rental manager

Vacation home owners who opt to manage everything on their own often describe it as a second job. That’s because the work never ends. There are always guests to assist, rooms to clean, repairs to handle, reviews to respond to, rates to adjust, marketing to to keep up with, and so much more. The telltale mark of running your vacation rental like a true business? Working with vacation rental experts to make it all happen. 

Full-service vacation rental managers (like Vacasa) will handle it all, while also maximizing your bookings and rental income. Hiring a manager means paying a fee, but they’ll keep your vacation rental business running smoothly and streamlined so you can earn the most money possible. 

Self-managing and full-service management >

Running your vacation rental like a business is no small feat. It requires understanding (and handling) all the moving parts that impact your bottom line. If you’re just starting out with your first vacation rental (or even onto your second or third), borrow some of our vacation rental business acumen. Follow our guide so you’ll know what to focus on.