Setting Rates Using Dynamic Pricing
Vacation rental business has become fiercely competitive these days. You are not alone with a vacation rental in your city or town and there are owners who will always try to wrest away your customers through competitive pricing. You must be careful in your pricing to attract many guests. These days, offering discounts during the off season is a strategic part of pricing, as well as knowing when you can and should charge more for certain dates, like special local events and holidays. Using Dynamic Pricing during those times, and really all of the time, can bring in more money and keep your occupancy rates for your vacation rental high.
Why I Love Dynamic Pricing Geeks
Setting prices very low is not a very good idea for your vacation rental. Never compete for last place. But how do you know where to set your prices. You can look online at other properties but you’re only seeing the units that haven’t been rented out yet. Plus, how do you...
Episode 047 – Lessons from the California Exodus
SHOW NOTES & LESSONS
OVER 5 MILLION PEOPLE HAVE LEFT CALIFORNIA NOW DUBBED "THE CALIFORNIA EXODUS"
Although people are moving into the state while others are moving out, Cali has still lost more than 1 million people and the population continues to shrink.
Who's moving in?
Those making $200,000 plus per year with higher education from tax-burdened states like New Jersey, New York, and Illinois (also seeing massive Exoduses).
Who's moving out?
Those making $55,000 and below with no college education.
Where are they moving to?
States with much more affordable housing like Texas, Arizona, Nevada, and Oregon.
CALIFORNIA HAS 5 OF THE TOP 10 MOST EXPENSIVE RENTAL MARKETS
What a One Bedroom Rents for in:
Los Angeles $2249 month
San Francisco $3400 month
Las Vegas $925 month
Phoenix $945 month
What a Two Bedroom Rents for in:
Los Angeles $3200 month
San Francisco $4500 month
Las Vegas $1122 month
Phoenix $1137 month
...
Episode 046 - Why You Shouldn't Treat Your Short Term Rental Like a Long Term Rental
SHOW NOTES & LESSONS
COMPARE INCOMES FROM A SHORT TERM RENTAL TO A LONG TERM RENTAL
2 Bed/1 Bath
Long Term Rental
1 Year Lease
$1200 month
2 Bed/1 Bath
Short Term Rental
Daily Rate
$87 per night
82% occupancy
$2140.20 month
2 Bed/1 Bath
Short Term Rental
Airbnb's Weekly
10% Discount
$609 for 7 days
-$60.90 discount
$548.10 per week
rent out 3 times
$1644.30 per month
A Loss of $495.90 mo
or $5950.80 per year
2 Bed/1 Bath
Short Term Rental
Airbnb's Monthly
28% Discount
$2610 for 30 days
-$730.80 discount
$1879.20 per mo
100% occupancy for
$1879.20 per month
A Loss of $261.00 mo
or $3132 per year
Use Vacancy Instead
Short Term Rental
Our Monthly
18% Discount
$2610 for 30 days
-$469.80 discount
$2140.20 per mo
Same as your original Single Day!
WHERE DO I FIND MY PER DAY RATE AND OCCUPANCY RATE?
If you've been a host more than a year, use last year's numbers.
If you haven't been a host for a year yet, then use...
Episode 045 – To Nest or Not to Nest: Controlling Your Guests’ Experience
SHOW NOTES & LESSONS
Forums are a Great Place to _____________.
A. Learn from other Hosts.
B. Bitch to and with other Hosts.
C. Learn from Guests' Experiences.
D. All the Above (Hint: This one!)
Nest is a great way to control your units when there's no one in them.
An AC unit works best when it's set no lower than 68 degrees. Under that and you're asking for trouble because that's when units will start to freeze up, which could potentially harm your unit.
What is the definition of Host?
What is the definition of Guest?
Be a gracious host and allow your Guests to be comfortable.
A locked thermostat screams, "I don't care if you are comfortable!"
Stop the Madness!!
- No more War and Peace sized Rules
- No chore lists for Guests (they're not your kids!)
- No "fixing" the washers and toilets so they use less water (unless they are BUILT that way, ie. Energy Efficient)
You only need a few rules. Here are mine:
01) No Smoking
02) No Pets
03) ...
Episode 044 – 5 Ways to Stay Ahead When the Competition Gets Tough
SHOW NOTES & LESSONS
5 Ways to Stay Ahead When the Competition Gets Tough
01) Back to Basics
Take a look at your Headline/Title of your Listing. Does it highlight your best feature?
What about your photos? Please, tell me you had them taken by a professional.
02) Know Your Competition
Use sites like AirDNA to keep an eye on your competition. What is their average room rate? What is their occupancy rate? Put a spy in their camp!
03) Don't Compete for Last Place!
You can't win the game of undercutting your competition, so don't even try to go there. Instead, be better and charge what you're worth. Use dynamic pricing tools like Wheelhouse to price your units.
04) Make Your Place SHINE!
Use a theme or and anti-theme to make your place stand out among the rest of your competition. Make certain your place looks amazing!
05) Go Above & Beyond in Service
Make certain that you offer something or do...
How to Deal with Bookings Cancellations
When you are running a vacation rental business, your aim is to get maximum bookings for maximum profit. Whether you focus on a high nightly rate or on high occupancy, you want a good return on your investment. If you start to experience cancellation problems or lower booking frequency, it can be a blow to your business. Cancellations are even tougher because not only do you lose out on the income you would have made but, depending on the timing, it may be more difficult to refill that spot. You may now find that bookings have slowed down considerably during that time frame. Ouch. Here are some tips to anticipate and prevent these types of booking cancellations.
Look at Your Cancellation Policy
Is it too easy for guests to book a reservation and then cancel their reservation with just a few clicks later on? If yes, then you need to make changes to your Cancellation Policy. We have ours set to “Strict” for a good...
Episode 035 – Best Tools for Automation: Putting Your Business on Autopilot
SHOW NOTES & LESSONS
Automation
*Schlage
*August
*Lockitron
Some need help, like Kevo, Z-Wave, or a Smart Hub.
Begin with eLocks
Then Dynamic Pricing
Add AirDNA
Make sure your Cleaning Company has Online Scheduling
Automate Your Messaging
Take a Look at Properly
Find a VA at onlinejobs.ph
Think Shark Tank: Do you want half of $2 million or all of $10,000?
Our Membership Site opens in May!!
WHAT BOOKS, PRODUCTS, SERVICES, OR LINKS WERE MENTIONED...
Please use our Affiliate Links whenever possible and help support the show. Thank you!
AAAAAAAAAAA
Recommended Article or Blog Post Related to This Week's Podcast:
Recommended Podcast Episode that is paired with this one like a Fine Wine:
Get This Episode's Show Notes in a pdf form...
PICTURE OF PDF
Show Transcript
[00:01] Over the last two centuries, nearly 90 percent of the world's millionaires have created their wealth through real estate. Here to tell you how you can ride this...
Episode 025 - Real Estate Investing: It All Depends
SHOW NOTES (and downloadable PDF)
LINKS to SITES
You're getting a free audiobook! Click to try Audible Free for 30 Days and discover the power behind reading a book a month (or more!). With audible, it's easy! Try Audible now, using our affiliate link, and you will get your first book right now for free! After that, you can pay by credit or purchase a membership. With a membership, you get 1 audiobook and 2 Audible Originals each month for only $14.95 per month. Michelle has been a member of Audible since 2006 and says it's her secret for reading so many books.
Village Impact, formally known as World Teacher Aid, is a Canadian charity dedicated to bringing education to students in rural areas of Kenya. The American chapter works through the publishing company, Hay House. Yes, THE Hay House! Marianne Williamson, Wayne Dyer, Mike Dooley, and Louise Hay - that Hay House!
AFFILIATE LINKS
DOWNLOADS
...
Episode 021 - Why is Pricing so Dang Hard?
Find out more and register for the "Plan Your Portfolio Webinar," January 10, 2019, at 7 pm Arizona Time here. Find out more about Airbnb's Smart Pricing and Dynamic Pricing sites, UseWheelhouse.com and BeyondPricing.com . Also, editing the episode we left out the fact that Dynamic Pricing on other sites is not always offered in all areas, so check to make sure they serve your location first.
Here are the books Michelle referenced in today's podcast. Note, these are Affiliate Links. Plus, you can try Audible for 30-Days Free and get your first audiobook free. After that, you can pay by credit or purchase a membership. With a membership, you get 1 audiobook and 2 Audible Originals each month for only $14.95 per month.
[00:00] Over the last two centuries, nearly 90 percent of the world's millionaires have created their wealth through real estate. Here to tell you how you can ride this wave with less risk and less capital, is...
