How To Lose $18,000 on your vacation rental

Here's a scenario that costs vacation rental owners real money every year, and most of them never see it coming. It comes down to one thing: whether you can handle back-to-back reservations.

What Back-to-Back Reservations Are

A back-to-back means one guest checks out and another checks in on the same day. No empty night in between. It sounds simple, but if you or your property manager can't turn a property around that fast, you leave a gap between every stay. Those gaps add up fast.

The Math That Should Scare You

Let's run the numbers. A decent occupancy rate for a vacation rental is around 50%, which works out to about 182 nights rented per year. Say your average stay is 3 nights. That's roughly 61 reservations a year.

Now imagine you can't do back-to-backs and you burn one empty night between every stay. That's 61 lost nights. At an average rate of $300 a night, you just left more than $18,000 on the table.

Yes, I simplified this to make a point. But the point is, if you can't accommodate back-to-back reservations, you are losing money, it's that simple. 

Why It Comes Down to Management

This is where solid property management earns its keep. Fast, reliable turnovers are the difference between a rental that pays and one that leaks income. If you want your place to make real money, the ability to turn it over in a day is non-negotiable.

Take a hard look at how your property gets managed. If empty nights are stacking up between guests, that's your revenue walking out the door.

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Have questions or want to learn more? Give us a call at 575-613-4243. We're happy to help.

Rob Swan | Qualifying Broker | Swan Realty Inc.