Here are some helpful tips you should know before you buy a vacation home. I have often been approached by potential buyers of Orlando vacation homes near Disney World. They ask me to please send them information about our management company and a list of our fees. While knowing the fees a property manager charges are important you have to dig a little deeper to make sure you are choosing the right property manager for you and your investment property.
Just so nobody thinks I’m dodging the question, here is a list of our fees. My management fee is $120 a month which is waived if your vacation home is not occupied at least 12 nights in any given month, $85 monthly pool cleaning fee, and a $25 monthly pest control fee. The cleaning fee depends on the size of your vacation home.
Our Company thrives on getting our homeowners bookings. In fact, I started Affordable Travel of Orlando (now OrlandoVacation.com) as a hotel wholesaler in 1993. We make our money when guests stay in our vacation homes.
Before signing up with a management company understand how they are getting their bookings/rentals. Most management companies put the vacation homes they manage on VRBO.com, Homeaway.com, and AirBNB.com. While it is nice to have a presence on these sites, you cannot rely upon them to keep your vacation home full year-round. The last time I was on Homeaway.com there were over 17,500 Orlando vacation homes near Disney World. There is just too much competition on these sites.
Yes, we do put our Orlando vacation homes on these sites but we also do all of our own marketing. We have over 750 affiliates that feed us business year round, we spend over $1,00,000 a year in pay per click marketing, and our sites get a lot of organic traffic. Last month, Orlandovacation.com alone had over 200,000 unique visitors. This is what separates us for other management companies…we produce bookings which produces more rental income.
Before you purchase a property, a good property management company should be able to tell you how many nights the property would be rented for the year and the net rental income property should be able to produce. After you get these numbers from a management company go to Homeaway.com or VRBO.com and see how much similar homes in the same neighborhood are listed on these sites. This will give you a real good idea of what your vacation home will bring.
The internet has made it so easy for guests to find the best deals. I would be very leery if a management company is promising you rates much higher than what you are seeing similar homes offered on these sites. Sometimes companies and salespeople will tell you anything to have you sign up with them.
There are only two ways to make money if you are a property management company:
1) Make money off of the rentals
2) Charge the homeowner for services performed on the vacation home.
You will really want to make sure you understand how a management company makes money before you sign up with them. If their business model is making money off of doing services to your house then I would definitely make sure they need your approval before doing any work over a set dollar amount.
When you are interviewing property management companies ask them for a list of all their fees and ask them to see a sample homeowner’s invoice.
Here are some fees to look out for:
Homeowner bookings fees, credit card processing fees, trip charges, and linen fees. Be careful, these hidden fees can really add up.
Owning a vacation home in Orlando is a good investment but you have to treat your vacation home as a business. Income has got to be greater than expenses. I would love to talk with you more about your vacation home and hopefully, we can work together in the near future. Please feel free to call or email me, my contact information is provided below.