Expanding Your Short-Term Rental Property Management Company in 3 Steps

In short-term rental property management, two paths can lead to growth without resorting to bank loans: reaching out to owners to include their properties in your portfolio or leveraging rental arbitrage. However, more than merely increasing your inventory is required. The key lies in optimizing the revenue potential of each property.

In the following article, we'll guide you through these two avenues of inventory expansion and offer advice on how to boost your revenue potential in three steps.

Strategies for Boosting a Property Management Company's Inventory

Convincing property owners to allow you to manage their holdings can take time and effort. They usually require evidence of your success, such as a portfolio of rentals under your supervision. If you've managed a few properties profitably, this might be sufficient to bring new owners on board.

Though this is an economical way to expand your inventory, achieving your objectives may require considerable time, marketing, and networking. Your earnings will depend on the rates you establish and the revenue share with the owner, which can fluctuate depending on the property and its location.

The second method, rental arbitrage, suits those with limited experience or a desire for rapid growth. Here, you rent properties long-term and sublease them for short-term rentals, pocketing the net revenue. This method eliminates the need for revenue splitting and an existing portfolio. However, ensure you can legally sublease the property before committing financially, and be prepared for the landlord's screening process.

Strategies for Boosting a Property Management Company's Revenue

After choosing the method best suited for adding more units, the next step is to optimize your property revenue. Here are three tips to help you, irrespective of your inventory accumulation strategy.

1. Broaden Your Vacation Rentals' Listing Channels

The more channels featuring your properties, the higher your visibility. This boosts your chances of achieving full bookings and maximizes your occupancy with the most lucrative reservations.

However, managing multiple properties across various channels can be challenging. Most managers utilize property management software to centralize all business operations, from reservation calendars to maintenance tasks.

If you require property management software (PMS) to consolidate your channel distribution, consider using a solution like Mistr PM with direct connections to each listing site. This will help prevent double bookings and data outages.

2. Establish Your Direct Listing Channel

While listing on all major channels is crucial, having a dedicated website for your properties is equally important. Your website is a direct channel, allowing you to sidestep channel booking fees and offering a platform for all your marketing activities. Direct channels are generally straightforward and economical to establish.

3. Initiate an Internal Guest Referral System

One effective strategy for enhancing your revenue involves incentivizing guests to make referrals. If a guest enjoys their stay at one of your properties, they can recommend it to a friend. The referrer, or both parties, receive a reward, such as a discount or gift card for future stays.

Encourage guests to share their experiences on your properties' Facebook page for exposure. A referral program is a cost-effective way to gain credibility and enhance marketing. Just ensure bookings happen through your direct channel to avoid hefty channel fees for self-sourced leads.

Have You Prepared the Necessary Tools for Growth?

The short-term rental industry can be highly lucrative. With the right systems and processes, scaling your property management business in terms of inventory or revenue becomes much more manageable.

While the three tips mentioned will steer you toward revenue maximization, managing everything can be daunting and time-consuming.

Optimize your properties' potential using comprehensive property management software like Mistr PM!

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