There are no true differences in owner services from one property management company to another.
There. I said it.
They all offer professional property managers.
They all offer marketing.
They all offer accounting services with an OwnerNet and direct deposit.
They all offer housekeeping & inspection services.
They all offer maintenance services.
They all offer online and offline reservation services.
And they all offer a “free rental analysis and projection”.
Maybe one or two firms offer a weekly newsletter or some other “benefit”.
But, really, they’re all the same.
It would be an act of incredible #RadicalHonesty to admit this to a prospective owner.
When they ask you how you’re different, tell the truth. “We’re not. We all offer the same services for the most part. What we’re hoping for is that we’re just a better fit for you and your property than your previous management company.”
Could you do it?
#RadicalHonesty and Rental Commission
Here’s one other way they’re all the same.
No one publishes a commission rate.
Of the dozens of vacation rental websites I’ve looked at, from coast to coast, I’ve found exactly 1 that posts a commission rate.
And why is this? Why does virtually no one post a commission rate? Or even a range?
Because commission is negotiable.
And why is that?
Why is commission negotiable?
Do different owners get different services? No, they don’t. Everyone gets the same package of services.
So what gives?
Savvy property owners, as in those that have owned and rented out their properties for a while, know how to play the game. They pay less.
New property owners don’t. They pay more.
It’s basically as simple as that.
Right?
I guess I couldn’t imagine a scenario in which you could admit that, though. Could you imagine a prospective owner asking how you arrive at the commission rate and you responding with, “Oh, by whatever you can bargain us down to.”
What does that tell you about commission rates?
Can You Handle Some More #RadicalHonesty?
Why don’t we do something different?
Let’s try spreading the truth around instead. Just to see what happens.
Answer questions with the whole, unvarnished truth.
For instance, If they ask how many weeks you’ll be able to rent their property, tell ‘em like it is, “Unfortunately, there’s just no way of knowing. The public is fickle. We market your property to the best of our ability, on as many channels as practical, but the fact is, we just don’t know.”
When they ask what additional fees you charge, tell them each one. In detail. Including cleaning and inspection. Including maintenance. Including pool/hot tub. Including linen.
The whole shebang.
What do you think would happen?
You would definitely lose some prospects. Not everyone wants that level of honesty. Just let them go.
But the ones that do sign with you, they’re the keepers. They’re your tribe. And if you continue to interact with them with that level of honesty and integrity, they’ll be fiercely loyal to you.
Wouldn’t it be great to start this owner/manager relationship from this position of trust?
And speaking of that, here’s my most radical idea of all:
Charge everyone the same commission. If nothing else, it would make your life so much easier.
Are you not performing the same services for each owner? Why would you take advantage of a new owner that simply hasn’t learned to play the game?
The same applies if you have tiers of service. Those commissions should be standard and readily available to owners, too.
To me, charging different commissions based on how well someone can negotiate is kind of, well, used car salesman-y.
It devalues your services. Vacation rental managers are service professionals, like attorneys or accountants. They don’t negotiate on their fees. Why do we?
When you allow a prospective owner to negotiate your rate down, you’re giving up your position of authority and changing the dynamic of the relationship. You’re putting them in the driver’s seat, where it should clearly be you.
What does that tell your prospective owner about the value you offer?
And just as a side note, we all know that the ones who pay the least demand the most. Right? Don’t you have more shoulder and off-season guest horror stories than in-season?
Just to add a little more to my already #RadicalHonesty, publish your commission rates on your website. Why not?
It would save you a lot of wasted time and start building that relationship before you even have your first conversation.
You’ll immediately weed out your tire kickers and negotiators. And aren’t they a majority percentage of your initial conversations? Couldn’t that time be better spent elsewhere?
Most importantly, prospective owners will immediately see you as honest and trustworthy. That’s the beginning of a great relationship.
I Don’t Get It
Here’s the part that I’ll never understand. Why would any property manager want an owner in their program who tries to undercut their prices?
I’ve touched on this in past posts, but I’ll say it again.
Vacation rental managers operate with a scarcity mentality. They think there’s not enough business out there, so they have to grab at whatever they can get. This simply isn’t true.
People are not going to stop buying vacation homes. They will always need managers to rent them.
LIkewise, people are not going to stop coming on vacation. If your location is popular, they’ll continue to return, barring a natural disaster.
If you keep up your marketing, you’ll attract new clients and owners.
Most importantly, if you treat people right, you’ll have plenty of repeat business, which requires no marketing expenditures at all.
More is not always better. Oftentimes, more is just more headaches, more money out the window and more stress.
There are benefits in keeping your circle smaller. Sometimes, it even leads to more money. But let’s get into that next time.
I’ll Go First
Here’s my unvarnished honesty.
If what I’ve written resonates with you, then you’re definitely my tribe. Thank you a thousand times and please keep reading and commenting.
If you’re scowling or shaking your head and thinking I’m crazy or uninformed or living in la-la land, please feel free to hit the unsubscribe button. We’ll probably never get each other, but I do wish the best of luck and success.
Thanks for reading all the way to the bitter end. As always, hit reply and let me know what you thought of this post.
Best, Alissa