The recent boom in the Airbnb industry has seen a rise in the short term rental property management market, proving to be a lucrative career path for those with an inclination towards hospitality. Getting started in this endeavor can be difficult, but the guide below will give you the tools you need to conduct your foray into this industry and succeed where others may not.
Becoming a short term rental property manager consists of the following:
- Get a basic understanding of the industry. Learn the duties and responsibilities of a short term rental manager and the nature of your local market.
- Define your market scope. Define your market coverage and narrow your focus.
- Decide on your property management model. Choose between becoming a full-service or half-service short term rental property manager.
- Create an Airbnb property management business plan. Develop a solid business plan with concrete goals to use as a framework and roadmap.
- Get a real estate license. Some states or cities require short term rental property managers to hold real estate licenses.
- Develop your short term rental management team. As your workload increases you will find yourself needing to hire a small, versatile team.
- Utilize software tools for short term rental property managers. Enhance and automate many time consuming tasks.
- Set up your Airbnb management fees. Work out a pricing structure for the services you plan to offer.
- Draft a vacation rental management agreement. Establish trust and avoid possible legal issues down the road.
- Build a website and market yourself. Get your name out there, find leads and develop a customer base.
- Look for local partners. Become a part of the community and focus on networking.
- Service your first customer. Take action and service your growing portfolio of customers.
1. Get a Basic Understanding of the Industry
There are plenty of places where you can learn about the industry, such as short term rental property management blogs, e-books, forums, YouTube channels, and podcasts. You could attend in-person or online meet-ups of general real estate professionals or specialized property managers.
Some of the most crucial things to learn are:
- Local supply of Airbnb properties
- Local demand for short term rentals
- Seasonality in supply and demand trends
- Most demanded property types by Airbnb guests
- Most popular Airbnb amenities in the area
- Prevailing daily rates
- Short term rental laws and regulations
- Necessary short term rental permits and licenses
- Fees and taxes that property managers of vacation rentals need to collect
Moreover, you could look for a job as a property manager at one of the best Airbnb management companies in your area as you take your first steps in the industry. The experience you can gain in a few short weeks there would be worth a hundred times more than what you can learn from reading websites and watching videos for months in a row.
2. Define Your Market Scope
Once you have a basic understanding of the duties of a short term rental property manager and the nature of the local market, it’s important to define your scope. In real estate, it’s hard to succeed without having a focus.
First of all, you need to define your market coverage. Generally, it’s better to start off small and grow over time than to stretch yourself too thin and achieve nothing.
Second, you need to further narrow down your focus. You could specialize in group travels, accommodation for traveling professionals, rentals for digital nomads, vacation spots for families, wedding venues, or a few of those.
3. Decide on Your Property Management Model
Vacation rental management falls into two main categories: Half-service and Full-service.
Half-service property managers for vacation rentals help owners with tasks that require a lot of time and access to short term rental data.
These half-service property management services include:
- Listing optimization
- Dynamic rental pricing
- Marketing
- Finding properties
- Interior design and decoration
- Navigating permits, licenses, and tax details
- Guest communication
This option is a better fit for managers who would like to have to learn fewer new skills, have less responsibilities, and work more closely with hosts.
Full-service short term rental property managers aim to replace the owner entirely to allow them to earn and enjoy passive income.
These managers take over all the responsibilities of half-service managers as well as:
- Listing and advertising
- Maintaining and coordinating repairs
- Interior design and furnishing
- Supply management and ordering
- Professional photography and videography
- Full service revenue management
- Dedicated member-success personnel
Take the time to thoroughly research what is expected from both service models before you get started. Choose your preferred management model to align your business goals, capabilities, and strategies.
4. Create an Airbnb Property Management Business Plan
Launching a short term rental property management company is no different from launching any other enterprise. You need to have a solid business plan with concrete objectives and strategies in place.
Some important questions to address in your plan are:
- What is your company vision?
- What problem in the market are you trying to solve?
- What makes you different from other short term rental property managers in the market?
- What are your objectives? (Try to quantify them. For instance, you may want to manage 10 properties within 6 months or make $7,000/month in a year.)
- Under what legal entity do you plan to operate?
- What is your marketing plan?
- Are you going to work on your own or do you need a team? How big of a team do you need? How are you going to hire your team members?
- What tools do you need?
- What equipment do you need? (This will largely depend on the scope of your work and your team. For instance, if you want to provide in-house cleaning and laundry services, you will need certain tools. If you decide to outsource housekeeping to local vendors, all you’ll need is a couple of laptops and transportation.)
- How much do you need to invest in your business? (This depends on the training that your team needs, the selected software tools, and the necessary equipment. As a beginner, it’s best to not rent an office and work remotely to save on costs.)
- What are your key performance indicators (KPIs) and how are you going to track them?
A well defined business plan can be used as a roadmap to help structure, run, and grow a business. It can also be used to help attract funding from potential investors, as well as provide a framework for managing and monitoring performance. The more detailed your business strategy is, the easier it will be to implement it and retain focus as you’re starting your company.
5. Get a Real Estate License
Regulations that can vary by state or even city require property managers to have a real estate license in order to operate legally. Usually this refers to long term rental property managers, but in some cases even short term rental property managers need to meet this requirement.
Regardless of state or city regulations, however, it is still good practice to receive your license so you may have a broader understanding of compliance in this industry. There are many rules and regulations in place regarding handling money, conducting operations, and other industry practices that a real estate license would help you understand and navigate.
Thus, you should check out local legislation to confirm if you need a license. If this is the case, you have to take the relevant courses and pass the exam to get your real estate license. It takes an average of 4-6 months to do this, so you should start working on your license as soon as you decide to manage vacation rentals, in parallel with defining your market scope and creating your business plan.
6. Develop Your Short Term Rental Management Team
Chances are that you will be doing everything yourself in the beginning. Eventually, as your workload increases and you have a better understanding of your own capabilities, you will find the need to hire a small team of a few versatile employees.
Things that you are likely to need help with include:
- Short term rental marketing
- Market analysis
- Housekeeping
- Inspections
- Maintenance
- Repairs
Initially, you can hire freelancers with different backgrounds so that you don’t have to pay them full-time salaries, at least until you secure a few properties in your portfolio. Maintenance, repair, and cleaning freelancers could be found on websites like Angi (formerly Angie’s List), Thumbtack, or Yelp. Marketing and market analysis specialist freelancers could be found on websites like UpWork, Freelancer, or Fiverr.
7. Utilize Software Tools for Short Term Rental Property Managers
Another must-have step in becoming a short term rental property manager is researching and subscribing to the best Airbnb management software tools for professionals. The proptech industry has expanded largely in the last decade and become the core of the real estate business, including property management.
Such tools can help you enhance and automate many time-consuming and tedious tasks, such as setting up a short term rental pricing strategy, syncing booking calendars across listing platforms, streamlining communication with guests, and coordinating cleaning.
Some of the top short term rental property management software tools include:
- Guesty for overall vacation rental property management needs
- Wheelhouse for dynamic pricing based on market insights and performance analytics
- Hostaway for channel management and multi-calendar sync
- Hospitable for team collaboration and task management
- Turno (formerly TurnoverBnB) for finding, scheduling, and paying cleaners
When choosing the right tools for your short term rental property business, check out online reviews on trustworthy third-party websites. They can give you great insights into which products are worth it and which are not.
8. Set Up Your Airbnb Management Fees
As an aspiring property manager, you have to work out a pricing structure for the services that you plan to offer to property owners. Most full-service short term rental property managers charge between 25% and 40% of monthly revenue including cleaning fees and other additional fees, while half-service managers charge about 10%. Moreover, some have extra fees for optional services.
Your rates need to be based on:
- Your management model: Half-service vs full-service
- Provided services
- Local short term rental property management rates
- Property type that you will focus on
- Use of technology vs use of human efforts
- Size of team
As a beginner, it’s a good idea to try to offer rates that are just below the fees charged by competitors. This will help you attract your first few customers (which is crucial for the success of your business) without looking suspiciously cheap.
To lower fees, you can try to automate as many tasks as possible via the use of technology, without ignoring the importance of human control over processes. Once you’ve established a reputation, you can slowly raise fees for new customers.
9. Draft a Vacation Rental Management Agreement
As a next step, you need to prepare a written short term rental property management agreement. You don’t have to write one from scratch. Instead, you can start off with the agreement that some of the leading Airbnb managers in your area use and customize it to your specific business.
While it might sound like a lot of work, it’s key to have your contract as detailed as possible. This will not only make you look trustworthy in the eyes of potential customers but will also help avoid legal issues down the road. Once the draft is ready, have it checked out by a local real estate attorney to make sure that everything is legally compliant.
You should consider publishing a copy of the agreement on your website. Many property managers don’t do this, and property owners find it rather frustrating that they have to ask for a copy of the contract.
10. Build a Website and Market Yourself
This brings us to the next requirement for becoming a short term rental property manager. Namely, launching your own website and marketing your business.
Having a short term rental management website is a must nowadays. Instead of hiring a full-time developer to build your website from scratch, it’s smarter to look for a readily available template that you can modify with the help of a part-time developer. This will help you save lots of time and effort.
Your website is where you will market your vacation rental management business (to property owners) and the listings that you manage (to guests). As soon as your website is live, you should start working on SEO by adding high-quality content using the right keywords. For instance, you can discuss local real estate trends, why the area is so great for investing in Airbnb, local tourist attractions, and why people should visit.
Your site will eventually become the primary place you receive new customers in the long run. However, it’s important to recognize and take action on the other methods in finding leads in your area.
Here are a few tricks you can use to find a few customers:
- Talk with friends and family: Ask around if people you know or their acquaintances might own a short term rental property in need of management services.
- Connect with an agent: Talk to an agent who works with investment properties as they might have clients who have recently purchased a vacation rental and have not found a manager yet.
- Find underperforming local listings: Identify a couple of Airbnb listings in your area that perform worse than the average, check if they are managed by a company, and try to connect with the owner to offer them better services than the ones that they are currently receiving.
Moreover, you can create professional social media accounts on Facebook and Instagram as the most popular platforms in the industry. At the beginning, you might need to use paid ads to launch your business as the short term rental property management space is very competitive. Additionally, you should start building an email list of potential short term rental property investors (to find new customers) and guests (to get bookings).
11. Look for Local Partners
While working on other aspects of your business, you should be on the lookout for local partners that might help you get started and succeed as a property manager. This includes a wide range of professionals, such as real estate agents (who can bring vacation rental property owners), interior designers (who can help you offer furnishing services), handymen (who can become a part of your maintenance team), cleaners (who can do the housekeeping services), suppliers (who can provide restocking), artisans and tour guides (who can help with welcoming baskets and Airbnb experiences), and even local store owners (who can provide referrals).
In other words, you should become a part of the local community and focus on networking.
12. Service Your First Customer
Finally, there comes the most exciting part of becoming a Airbnb property manager: Servicing your first customer. However, this might prove to be easier said than done. There’s a lot to do and beginners can sometimes find it overwhelming.
Here are a few key actions to get you started on servicing your first customer:
- Prepare the home. Go over to the property and take stock of what needs to be changed in order for it to work as a short term rental. This could mean conducting an inspection and addressing any repairs that need to be made, installing smart locks, redesigning or refurbishing the home, or scheduling a deep cleaning.
- Generate listings. Short term rental managers should create a custom listing for the property they are representing on major booking platforms. Focusing on detailed listing descriptions, high quality photos, and competitive pricing should be your priority.
- Review licenses and permits. You want to make sure that everything is above board in regards to the law. Check your local regulations and make sure that your customer’s property is in compliance.
Start out small by onboarding a couple of properties first and use them to smoothen out the process. Only grow your business once you are certain that you and your team have the capacity to handle a larger portfolio with the expected level of quality and attention to detail.
Short Term Rental Property Manager FAQs
What does a short term rental property manager do?
A short term rental property manager ensures the smooth, successful, and profitable operations of residential properties that are rented out on a short term basis and that are not owned by them. The responsibilities of Airbnb managers include but are not limited to listing, distribution, marketing, housekeeping, maintenance, and repairs.
Do you need a license to manage short term rentals?
Most US states do not require Airbnb property managers to have a real estate license, but some do. If you’re interested in becoming a short term rental manager, you should check out relevant legislation in your market.
What qualifications do you need to become a short term rental property manager?
In some states or cities, vacation rental property managers need to have a valid real estate license. Others require them to be certified property managers. Even if you operate in a state where these are not demanded, it’s a good idea to get a license and a certificate so that you can expand your business into other aspects of real estate and to appear as a more reliable professional to potential customers.
What are the benefits of being an Airbnb manager?
Becoming a short term rental property manager offers many advantages, such as no need for a university degree, competitive salary, and somewhat flexible working hours. Moreover, this is a very exciting business which holds a strong potential for future growth as the number of vacation rentals keeps expanding.
How long does it take to become a short term rental property manager?
Becoming a short term rental manager takes a few months. In states where a real estate license is required, you need to factor in an extra 4-6 months. You need a few weeks to register your business, a few weeks to build a team and get the tools, and a couple of weeks to launch a website and start promoting yourself. You might need a month to find your first customers.
How much do Airbnb property managers make?
According to Glassdoor, short term rental property managers make between $48,000 and $77,000 per year, with a median salary of $61,000. However, their remuneration can vary significantly, depending on their market, services, experience, number of properties under management, and team size.
Bottom Line
Becoming a short term rental property manager is a promising career choice for individuals interested in real estate and hospitality. The good news is that getting started is less daunting than you might think. You simply have to follow the 12 steps outlined above to be on your way to professionally managing vacation rentals and earning income from it.
