Today we are talking about how to determine the value or rental price of your vacation rental. This is a very important part of getting it on the rental market, and it’s not an easy task. I’m going to tell you the way I handle this for own properties.
First, I carefully analyze what other properties are going for on sites like VRBO and Home Away. This gives me an idea of what the market will bear and what property owners are asking. Sometimes people will ask thousands a month for a three bedroom house and when I check their calendar, they are unoccupied 75 percent of time. That tells you the price is probably too high.
In my experience, it’s best to start off below market value in order to get booked up. I might start my property off at $750 a week just to get customers and stay booked. If I can get to 50 percent or 60 percent booked, I’ll raise prices to what the market will bear. That means I might go to $850 or $950. Even if I know I could be getting $1,000 or $1,050 per week, I start off low to ensure maximum occupancy. You want to be quick to refund a guest’s deposit, and you also want to solicit reviews because most of your customers will come back year after year.
In the summer, rates will always be cheaper in Tampa because it’s the off season. Most travelers looking for properties to rent are coming from South America and Europe. It helps to offer a summer discount. You might also get a lot of people from out of town looking for short term rentals as they attend school for graduate work or special projects. Summer rates will be a better value. Monthly rates might go to $2,000 a month in the summer when in the winter you can set a rental price of $3,500 or $4,000 for the same property.
We would be glad to help you determine the value of your vacation rental. Please contact us at HomeSeekers, and we will do our best to answer your questions.