11 questions to ask yourself before choosing a management company
11 questions to ask yourself before choosing a rental management company
You are considering changing management companies or have been managing the short-term rental of your property for (too) long and are thinking of handing this responsibility over to a management company. A wise decision: time and peace of mind are priceless! But how do you choose the best management company to meet your needs? To help you make the right decision, the Reserver.ca team invites you to ask 11 questions during your selection interviews.
What is your strategy for increasing my rental income?
This question will give you the key points of the management company’s recipe for making the most of your property.
As an example, Reserver.ca uses a dynamic pricing system based on data science that uses 7 factors to determine prices.
Moreover, a serious company will not only help you increase your income but also reduce your expenses and tax burden and optimize the occupancy rate to protect your assets.
It’s all well and good to talk about higher incomes, but how do you do it?
Each company has its own recipe. Renting a cottage is good. Experiencing is even better. Customers don’t just rent for the sake of renting, they want to have an unforgettable time and are often willing to spend more to have that experience.
What is your recipe for success?
Put yourself in the shoes of your next guests… Would you rather live in a “3 bedroom, 2 bathroom cabin” OR experience a “family reunion in a spa with a mountain view”?
Words, photos and sharing positive feedback can make all the difference…
The triple wow effect: an irresistibly designed and staged cottage, expectations surpassed as soon as you step inside, and little touches that make all the difference. This also gives 5 star reviews that will give momentum, velocity to your listing that will become more and more attractive over time. However this is not done from day 1, it takes some time. Beware of those who promise you a full calendar on day 1.
So, what will the management company do to provide an unforgettable experience for your guests?
NOTE: Judge the performance in the off-season. It’s easy to rent in the high season, but the real experts will manage to bring in income even in the very low season. It is an additional way to bring in revenue by filling that gap.
What is included in your management fee?
Depending on the management model, management fees can range from 15% to 55% of rental revenues. This rate varies according to the services included: signage, communication with clients, guest screening, housekeeping…
Would you rather pay a 25% commission on a $100,000 ($25,000) income or 15% on a $50,000 ($75,000) income, although the first one seems higher and less attractive, it is only an illusion because you will have an annual loss of $325,000 even if the commission is higher. In fact, your income will be $75,000 for the first compared to $42500 for the second. It will be important to do the math.
The revenue optimization strategy as mentioned in point 1 is vital. A lower or higher management fee does not guarantee optimal income and therefore directly affects the income in your pocket at the end of the year. Ask for an analysis of profitability potential and evidence based on comparables.
What are your packages?
Some management companies offer a single package… take it or leave it. Not very flexible! Some just post your property and others will take care of you and do your annual accounting. The range can be very wide. What exactly do you need? At Reserver.ca, we offer several packages to meet the needs of each of our partners.
How do you protect my assets?
No one wants to have problems with guests, whether it’s breakage or complaints from neighbors, or even litigation that could cause you to lose your CITQ certificate. Therefore, the problem must be eliminated at the source by filtering out unwanted customers. What is your next manager’s strategy? The Reserver.ca team has designed a 21-point filtering system. We even offer the Peace of Mind Guarantee, in case our system lets an unwelcome guest through. Yes, no system is perfect!
What is your target occupancy rate?
If your counterpart gives you a rate that is too high or too low, beware. It means he doesn’t know his business well or he thinks he’s taking advantage of your lack of knowledge, and you don’t know that. However, if they tell you that they will find the sweet spot, i.e. the lowest occupancy rate for maximum revenue, they are an excellent candidate. In fact, a perfect optimization between the income and the occupancy rate will allow you to spend more often personally enjoying your property while avoiding premature wear and tear and risks of breakage. The best of both worlds… However, be wary and ask for proof… At Réserver.ca, this is our approach… Proof in support
On which platforms will you market my property?
One of the keys to success is marketing. A good manager will not be satisfied with just one platform. If it only tells you Airbnb, run away! Although this is a major channel, there are other channels that can bring you more. It will broadcast the profile of your property on the best global and Quebec platforms, in addition to social networks. This aspect is essential, do not hesitate to dig on this subject.
How do you ensure quality control?
Cleanliness is one of the main points that come up in guest comments. The management company must therefore ensure that the maintenance of your property is impeccable. Comments are directly affected by housekeeping. A bad review could sink your listing and at the same time directly reduce your income. It will be important to never neglect this aspect and to ask your suitor for clear answers.
Other important points such as the accuracy of the information on the listing, the accessibility of consumables, the maintenance and repair of goods or property to offer the least friction possible is not to be neglected either.
How do you handle emergency situations?
Providing fast service is essential. That’s why we respond to calls within 15 minutes and go to your location if needed.
What is your plan to help reduce my expenses?
Website with integrated reservation system, property manual, maintenance, cable TV, etc. These are all expenses that can be reduced while maintaining an exemplary customer experience.
Since there is a big difference between the tax rate of a tourist accommodation (about 19%) and an apartment building (about 50%), we make every effort to ensure that your property falls into the former category. A significant reduction in your tax burden, right?
What do you have planned to save me time and free me from repetitive tasks?
We know: time is money. And managing a short-term rental property is time consuming. Reserver.ca partners save a lot of time by automating certain repetitive tasks. This is especially the case with email automation and a security system with smart locks and much more.
In conclusion, entrusting the management of your property rental to a specialized company can save you a lot of time and money. But to find THE right company that will meet your needs and help you achieve your goals, make sure you ask all the essential questions.
Feel free to ask us for a business case and see how we can help you make the most of your rental property.
