VRS395 – The 5 Biggest Mistakes New Short-Term Rental Property Managers Make

I’ve been in this business for over 25 years, 19 of them as CEO of a property management company, and over those years we’ve made plenty of mistakes.

Things we’d not do if we were starting up again.

In this episode, I talk about five of the most common errors new property managers make when they embark on this fun journey.

You’ll also get to witness a rant on an expression that annoys me intensely because if there’s one thing that drives me nuts it’s being called a Mom-and-Pop business.

A recent article in Skift set me off.

“The case for rollups in the vacation rental space is two-fold. First, North America has an estimated 10,000 property management companies. The owners of many of these mom-and-pop companies are Baby Boomers who have one eye on retirement. In theory, this pool of businesses gives companies like VTrips and Vacasa a wide choice of companies to choose from, buying only the best — to paraphrase a case made by analyst Byrne Hobart of The Diff newsletter.”

Firstly, every professional company will have an eye on ‘retirement’. It’s called an exit strategy and every company should have one. It’s part of a strategic plan.

Secondly, I’d like to see the statistics showing how many owners are Baby Boomers.

From what I hear, it’s savvy millennials and Gen Xers who mostly populate the new property management sphere.

Finally, where does the estimate of 10K managers come from? A Hostully survey in 2020 suggested it was more like 23K.

So the stats are highly suspect and the commentary even more so.

As usual, I went down the rabbit hole and found this on an Investor website:

“Mom-and-pop” is a colloquial term used to describe a small, family-owned, or independent business. Mom-and-pop stores are often operations that struggle to compete with more substantial establishments, such as big-box retailers, who generally boast more buying power than smaller players. In the last few years, “shop local” and “shop small” have been used as slogans in marketing campaigns. The term “mom-and-pop” also refers to inexperienced investors who casually play the market.

I got angry and so should all those hard-working small family-owned and independent businesses – which incidentally include some of the oldest and longest-running vacation rental companies in our industry.

Anyhow… back to the meat of this episode where you’ll hear:

– Why you should niche down more
– The importance of defining the where, what and who of your business
– The reasons not to put all your eggs in one basket
– Why you need to really think about what you like to do vs what you want to do vs what you need to do
– The reasons not to look for a clone of yourself and why you first hire should be your polar opposite
– How to be savvy when choosing software
– What to look for in property management software.