When you want to put your Colorado vacation home on a rental program, how do you know which management company you should hire to take care of it for you? You have many options, from renting it yourself using the internet with some local assistance, to being very hands off and doing no more than cashing your check each month.
Decide what your goal is for your property. Do you want to rent it as many nights as you can and make as much money as possible? Or are you more concerned about the condition of your condo and prefer to have someone that you know will screen the renters very carefully and check the inventory after the guests leave? Most people want both, but it is not always possible, and you will have to do some research and ask a lot of questions. Here are a few suggestions when you talk to the potential managers.
1. What fees do you charge besides the 25 to 50% you will take of the total income? These could be cleaning fees, marketing fees, internet advertising, linen fees, telephone charges, health club use or any number of other things. There is one particular company in town that charges 50% plus so many other fees that they end up with about 57%.
2. How often is the property inspected; after every cleaning, once a month, twice a year? Is the inspection cursory or do they check against an inventory list to make sure nothing is missing? What are they looking for when they do the inspection?
3. How often is the carpet cleaned and is it spot cleaned as needed? This is probably my biggest gripe, as it would be so easy to spot clean, and yet often nothing is done until the property is scheduled for its annual carpet clean. There is no excuse for your home or condo to be dirty when guests arrive.
4. When does my check arrive and what is the cutoff date for payment? Getting your check July 20th for June rentals is about as far as I would let them go. Ask what kind of accounting you will get. Will it be a detailed statement or just a check each month? Do they require that you give them a deposit, and if so, how much, and under what circumstances will it be used?
5. What if I want to use my condo myself? Do they routinely charge a cleaning fee or will they accept the condition in which you leave it? Many management companies have had poor experiences with the owners not leaving the condo in the condition they think it should be for the next guest, and they charge to clean it. Don't forget that the cleaning includes linen changes, new shampoos, soaps and coffee packets and little extras like folding the kleenex into a fan and the toilet paper into a little "V".
6. If I want to book my condo for a friend of mine to use at no charge, do I lose my place in the rotation of units? This happens most often at the ski areas, where they might have 30 similar units in the rental program and they are rented in rotation. You might lose your place in the rotation, and therefore lose a rental opportunity if you or a friend use your condo.
7. When is the deep clean done, what does it consist of and how much will it cost? Do I have the option of doing the deep clean myself if I want to? A deep clean usually means cleaning things that don't get done on a regular basis, like baseboards, blinds, carpets, behind and under the refrigerator and under the sofa. The bedcoverings and pillows should be washed or sent out to be drycleaned. Will the managers notify you if they think you need a new hideabed, paint or new carpet? Will they lower the ranking of your unit if you don't? (ie: gold, silver, bronze.)
8. How is routine maintenance handled? How much money will they spend on your behalf with prior authorization and at what point will they call you to see if it is ok? Do you have the option to do the maintenance yourself if it is not an emergency?
9. Do you get a security deposit from the guest to cover breakage or missing items and will you charge them if something happens? I find that frequently the ski area lodging companies don't want guests upset by charging them for damages because they want them to come back again. Often the homeowner is the one that gets to foot the bill. By the time the homeowner finds out about the damage, it is too late to charge the guest for it, even if you were to know which guest it was.
10. I know, I said nine, but here is a bonus. Talk to as many people as you can who have had experience with rental companies. Ask the company for referrals and talk to your resort area Realtor. He or she should be knowledgeable about the companies in town and their reputations will tell you a lot about how they operate.
I have written several other posts on my experiences and those of my clients with Colorado vacation homes, so be sure to check for similar articles. Among them are "The good, the bad and the ugly" , "6 easy money making ideas for renting your condo", "Your vacation home can pay for itself" and "How to get your rental property to cash flow".