Where To Market Your Vacation Rental
Vacation rentals have been dominating the traditional
hotel stay experiences as of late. The current worth of the global short-term
rental market is $100 million, a number many homeowners are thrilled about,
and why wouldn’t they be. What’s even more exciting for the owners of vacation
rentals, are the projections for 2019. This market is expected to reach a
whopping $170 billion.
Homeowners across the world and reaping the benefits of their vacation rentals
to create passive income and become closer to the ultimate goal - financial freedom.
Along with the financial increase in the market, comes competition. Other people want a piece of the profits now too. When there’s competition in any marketplace, it means the quality of your product, in this case, your home, and the service you provide, need to be top-notch. It’s vitally important to offer a memorable vacation experience with incredible amenities, and offerings, fit to match your property and its location.
How and where should I list my vacation rental?
HomeAway and VRBO subscription plan
If you choose to utilize the HomeAway and VRBO platforms, you have the option of purchasing their subscription plan. The cost of the subscription itself would be $499 for the year. Also, an additional 3% credit card processing fee would apply to all bookings.
Let’s look at an example together:
Yearly revenues: $30,000
Yearly subscription fee: $499
CC processing fees: $900 ($30,000 x 3%)
To list your property it would cost:$1,399 for the year
Your gross annual income would equal: $28,601
Based on research, the HomeAway and VRBO subscription is a better option than the pay-per-booking option for homeowners who list their property for more than 6 weeks per year and earn at least $7,000 in bookings. However, if this does not fit your specific needs or goals, then using the pay-per-booking option would work better for you.
HomeAway and VRBO pay-per-booking option
When you elect the pay-per-booking option on HomeAway and VRBO, you pay 5% for booking fees and a 3% credit card processing fee on those bookings.
Using the same revenue number above, here’s the difference between each option:
Yearly revenues: $30,000
Yearly booking fees: $1,500 ($30,000 x 5%)
CC processing fees: $900 ($30,000 x 3%)
To list your property it would cost:$2,400 for the year
Your gross annual income would equal: $27,600 As you can see, the pay-per-booking model costs about $1,000 more in fees than the subscription model. As mentioned above, it’s best to use the pay-per-booking plan only when you’re renal income is less than $7,000 a year.
Stats:
Active users: 9.8 million monthly visitors
Number of countries: 190
Number of listings: 1.2 million
Insurance available: Up to $1,500 for damage protection and up to $50,000 for cancellation protection
Bookable through channel manager: Yes, with a minimum requirement of 5 properties
Other traveler benefits: Book with confidence guarantee
Source: HomeAway and VRBO
Airbnb
Airbnb only uses a pay-per-booking model. When you list your rental property on their site, you pay them a 3% booking fee.
For example:
Yearly revenues: $30,000
Booking fees: $900 ($30,000 x 3%)
To list your property it would cost:
Your gross annual income would equal:
Due to Airbnb’s low fees, they’re a great platform to list your vacation rental. Also, they offer homeowner’s a lot of options, such as the ability to list a shared room, a private room, a campsite, a treehouse, or the entire house. Airbnb has been a much more popular platform for vacationers looking to book a short-term stay, as opposed to weekly or monthly stays.
Stats:
Listing Cost: Free
Active users: Over 150 million people have made a reservation on Airbnb (and there are 6 million monthly users)
Number of Countries: 192
Number of listings: More than 3 million
Bookable through channel manager: Yes
Trip insurance: Host has protection insurance up to $1,000,000
Other traveler benefits: Airbnb added an offering called “Experiences.” It allows guests to find
and book unique tours and activities in the location of their booking.
Helpful facts: Hosts get paid 24 hours after the scheduled check-in.
Source: Airbnb
Tripadvisor and Flipkey
TripAdvisor and FlipKey use a pay-per-booking model. When you list your property on either of these sites, you pay a 3% booking fee.
For example:
Yearly revenues: $30,000
Booking fees: $900 ($30,000 x 3%)
To list your property it would cost:$900 for the year
Your gross annual income would equal:$29,100
Tripadvisor and FlipKey have low fees, like Airbnb, which make them very affordable. On the other hand, they do charge travelers a premium – more than any of the sites that are being compared here.
Stats:
Listing Cost: Free
Number of countries: More than 145,000 destinations worldwide
Number of listings: Over 835,000 listings
Active users: More than 3 million visitors
Bookable through channel manager: Yes
Insurance available: Owners can request a security deposit and there is a Payment Protection plan for guests.
Source: TripAdvisor
Booking.com
Booking.com uses a pay-per-booking model. When listing your rental on the site, you are required to pay a 3% credit card processing fee* as well as a 15% booking fee.
For example:
Yearly revenues: $30,000
CC processing fees: $900 ($30,000 x 3%)
Booking fees: $4,500 ($30,000 x 15%)
To list your property it would cost:$5,400 for the year
Your gross annual income would equal:$24,600
*Booking.com doesn’t have a credit card processing fee per say, rather they require owners to pay for a secure merchant account, such as VRP or Square, and that service generally charges a 3% fee.
Compared to the other rental listing platforms, Booking.com does charge a hefty fee to the rental property owners. However, on the upside, they’re the only site that doesn’t charge any fees to their travelers, which offers guests a huge incentive to book on this site.
Stats:
Listing Cost: Free
Number of countries: 212 (with over 79,000 destinations)
Active users: 40 million monthly visitors
Number of listings: Over one million active properties
Bookable through channel manager: Yes
Insurance available: N/A
Traveler benefits: Most properties can be booked with the option of canceling without penalty. Plus, they strive to offer the best, most competitive rates for travelers while offering diverse accommodations.
Source: Booking.com
A few other listing site options
Expedia Stats:
Listing Cost: FreeNumber of listings: More than 500,000
Number of countries: 75
Active users: N/A
Commission: Negotiable, starts at 10%
Bookable through channel manager: Yes
Insurance available: No
Traveler benefits: Low-price guarantee and you can book everything in one place; your flight, accommodations, and rental cars.
Source: Expedia
Priceline Stats:
Listing Cost: FreeNumber of listings: 635,000 properties
Destinations: 150 countries
Active users: 13.4 million monthly visitors
Commission: Negotiable, based on a sliding scale
Bookable through channel manager: Yes
Insurance available: No
Traveler benefits: You can book everything in one place; your flight, accommodations, and rental cars.
Source: Priceline
What about Hometogo, Tripping.com, and Kayak.com?
If you’ve heard about the sites; Hometogo, Tripping, and Kayak and are curious about what they do exactly, we can explain. These sites are referred to as aggregator sites. That means they find and gather information listed on other vacation rental sites, like Airbnb and VRBO, and advertise them all in one place for their users.When guest’s book a vacation home using one of these sites, a commission is paid from the site who’s hosting the actual listing. For instance, say a visitor is browsing homes on Kayak.com for their upcoming vacation in Tulum, Mexico. Once they find the perfect home, they decide to book it. Say that particular home was pulled from an Airbnb listing. That means Airbnb will pay a fee to Kayak.com, for assisting in the actual rental reservation.
So there you have it, a guide to the many vacation rental platforms available for you to list your property. All that’s left now is to decide which one, or maybe which two listing platforms are best for your rental home. Happy renting, and enjoy your extra income stream.
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Ryan Gravel
Ryan Gravel is an American real estate broker and developer. He began his career at a young
age working for his family owned construction company.
After graduating college at the University of Central Florida with a degree in business,
Ryan set out to find untapped prolific markets around the world. His search landed him in
Playa del Carmen, Mexico where he founded Virgin Realty Mexico and co-founded the Saatal
Development Group one of the fastest growing development companies in the Riviera Maya.
With extensive market knowledge, professionalism, etiquette, innovation and integrity Ryan
is known as one of the most highly respected real estate advisors in the region.
