How do you maximize rental incomes over the summer in Dubai?
Despite the adverse effects of the pandemic on the hospitality industry, the short term rental market is thriving and occupancy/higher nightly rates are up by 124%. If you are a homeowner looking to increase your holiday home’s profit, or simply someone looking for a reason to invest in a home, here are some tips to help you out:
Perfect your pricing!
To begin, ignore what long-term rental properties charge for monthly rents. Rather, look at them, but only to run a comparative cash flow analysis to determine which leasing model would generate more profit for your property. Your competition as a vacation rental operator doesn’t include long-term rentals, but rather hotels and other comparable vacation units. Get a sense for what hotels and similar vacation rentals charge in your immediate area. Consider aiming for around 20% less on a nightly basis than nearby hotels.
Keep in mind that your pricing can and should rise as you establish yourself and your unit. In the beginning, with few or no reviews, you’ll probably need to entice your first guests with bargain pricing. Once you establish legitimacy through reviews, you can raise your pricing to meet or slightly surpass nearby competitors.
Push for Longer Stays
As with long-term rentals, the greatest labor and costs in managing short-term rentals come from turnovers. From cleaning to coordinating access with guests and answering their questions, it costs far more time and money to rent to 10 guests in a one-month period than to a single guest staying for an entire month.
What’s more, short bookings can actually cost you the more lucrative longer bookings. If someone rents your unit for one night, it prevents a prospective two-week guest from being able to book your unit for that block. So, price accordingly. Charge a higher nightly rate for stays under a week, and then offer a discount for guests who stay at least seven days. Keep graduating that discount the longer they stay, up to a month.
Consider Pet Friendly Policies
Pet owners often have a hard time finding hotels and vacation rentals that accommodate their four-legged family members. That means a shortage of supply, which in turn creates an opportunity. Of course, pets cause more wear and tear on your rental property. That means you should charge extra for them to make it worth your while. By accepting pets, you can not only collect more money on a nightly basis, but you can also attract more guests and achieve higher occupancy rates. And in the vacation rental business, profits come down to occupancy.
Build a base for reviews
You can put together the best listing in the world, but if you have no reviews, guests will be reluctant to book with you. Start with a simple two-pronged approach to scoring reviews. First, price your property competitively to beat your competition if you don’t have many reviews. Second, put together a guest follow-up strategy for securing reviews.
Work with Frank Porter
Fortunately, Frank Porter can do all the work for you so you can sit back, relax and count your dirhams. Is your apartment not quite ready for guests (or even completely bare)? Frank Porter offers everything from staging to full design services. Additionally, they communicate with potential guests, manage arrivals and departures, coordinate across platforms, and take care of all the paperwork and regulations. We even do the laundry! Whether you do it on your own, or use Frank Porter, there’s never been a better time to rent out your apartment. Turn your home into flexible income that you control!
