W E A LT H A S A VAC AT ION
out to other vacationers. A lot of VRP owners get their start this way, and they do it by using DIY websites. These sites help owners fi nd renters. But it can be a tough road, the DIY route. It’s kind of like having a neighborhood where you have no zoning laws whatsoever, where a slaughterhouse can be put up right next to your home. There’s just no control; there’s no uniformity. This approach works okay for properties that exist outside of created communities, where there is really no other option. What I mean by this is if you’ve got a home in a suburb just outside of New York City, a DIY listing is the way to go. If you’ve got room in that home, and need to connect with people who want to visit New York City and avoid Manhattan hotel room prices, that’s okay. As the owner, you’ll need to put your room up on a DIY site. If you buy a condo or a home inside of a development that has a very good, exceptional third-party rental company in place—or one of the new hybrids that has a developer with their own rental management company—and insist upon doing your own management and using a DIY website, however, that’s not a great idea. You’ll have a dozen other owners in the community doing the same thing and you will all try to undercut one another. The first thing everyone does in this situation is lower their prices, and then the others lower in response, and you have a big mess. The other issue with the DIY website placement approach is the goal with these sites is to try to get your property to 100 percent occupancy. Occupancy is pushed very hard, but it doesn’t make good business sense to be at 100 percent. It makes good business sense, instead, to be 70 percent with a high average daily rate. From an economic standpoint, you will make more money, net, if you’re at 70 percent with a very high average daily rate than you will at 100 percent battling it out for the lowest rate. Why? Because your home gets trashed at 100 percent occupancy. It will get damaged. This extremely high occupancy approach can prove to be a bad business decision if it makes your investment deteriorate—and not
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