Why is a market analysis necessary?
Because information is power. If you don’t know what the market will bear then you have no basis upon which to optimize your own vacation rental revenue.
Did you know that just by adding a hot tub to your vacation rental you can increase your rental rate up to 20% and still keep the same volume of rentals? This could be a game-changer on your yearly bottom line. It would increase demand on your property, increase your rental rate, increase your property value and it would likely pay itself off in the first summer.
Many investors are buying vacation rental properties solely for running a vacation rental business. This can be a great business to get into as not only do the rental incomes pay off the mortgage and expenses to produce residual income but as the property values increase appreciation can skyrocket your bottom line profits.
In the case of Brantingham Lake, this business model would be hard to work due to the fact that there are few properties available for sale and many are still family-owned. Also, the fact that there is only a 2.5-month window of prime rental dates each year doesn’t make it an ideal location when compared to other locations that have year-round rental demand and can be purchased for relatively similar prices.
But for those of us who love and don’t plan to leave Brantingham Lake, I did a Vacation Rental Market analysis to help our fellow renters understand how to get the most out of those 2.5 months.
Some property owners rent their properties out all summer and some rent out their personal residences for short periods in the summer just to help pay expenses. They essentially split time between renting and living in the property themselves trying to find a happy medium of paying the bills and enjoying the property.
One of those expenses is of course the high property taxes in the area.
Brantingham Lake Market
The Brantingham Lake vacation rentals market has grown at an average annual rate of 5% since 2011. The population in the area is forecast to grow by 3% annually, which will increase demand for short-term rentals over time. Vacation rental prices are expected to rise with inflation and high occupancy rates will likely remain steady due to increases in urban sprawl and the uptick in travel.
The Vacation Rental Industry is one of the fastest-growing industries in the world. It’s also predicted to be worth $200 billion by 2022, which means that there are big opportunities for investors and entrepreneurs alike. Brantingham Lake is one of many lakeside towns experiencing growth in vacation rental properties.
The following analysis helps forecast what will happen in the Brantingham Lake market over the next few years based on current trends as well as show how these trends could impact homeowners, renters, and businesses near this popular destination.
Brantingham Lake Statistics
In 2021 Brantingham Lake had 20 Vacation Rentals that were available during the summer months.
5 of those rentals could accommodate between 10 to 16 guests
10 of those rentals could accommodate between 5-9 guests and
5 could accommodate 1-4 guests
Out of these 20 rentals, the average nightly rate was $279.12
The average nightly rate for the 10 – 16 guest rentals was $399.60
For 5-9 Guests the average rental price was $231.44
and for 1-4 guests $182.60
To check out a selection of Brantingham Lakes vacation rentals visit Brantingham Lake Vacation Rentals
Whats this mean?
Since Rentals are in high demand in this current atmosphere, especially in July and August, it can be reasonably predicted that most rentals will be 100% reserved in July and August and at the very least, half reserved in June and September.
For my property, Grant Island Cottages we have consistently been booked for July and August 100% over the past 15 years without any vacancies.
With the average nightly rate on Brantingham Lake being $279 we can estimate the average rental from June to September will produce a gross income in the ballpark of $25,958.
So for property owners on Brantingham Lake thinking of becoming hosts, these figures could help you make a decision of renting out your property would be worthwhile for you.
Of course, there are plenty of expenses that are inherent in the Vacation Rental business.
You must factor in the work that goes into running your property like cleaning expenses, wear and tear from additional traffic, and if you don’t plan on managing and marketing the property yourself, a property manager.
Is a property manager right for you?
For property owners looking to do as little work as possible themselves and let the property create passive income for them, there are options of hiring a local or virtual property manager. Virtual property managers are companies that take care of all the online marketing of your property and help with advising on finding and organizing local help like house cleaners.
Each company is a little different in what they provide and there are vast differences between local and virtual property managers. Some of these differences are the fees they charge and how hands-on they are in managing your property. If you’re considering this route you’ll need to do a lot of research before making a decision on which is right for you as some can have long-term contracts. So you won’t want to make this decision lightly.
Our guide to help you through this process is coming soon. Sign up to our blog so that you’ll get notified soon as it comes out.
Vacation rental fees
One of the main fees associated with renting your property are the commission fees for listing your property. Airbnb takes 3% from vacation rental hosts, VRBO takes 8% and Booking.com takes up to 37%! VRBO and Airbnb both charge an additional 5 – 14%, respectively, to the renter making your listing more expensive for the traveler. See our fee comparison chart for details.
If we take our average Brantingham Vacation Rental property and calculate the fees that are paid we can see that the average Airbnb owner paid $779 and the renter paid $3634.
How you can reduce fees
So what can owners and travelers do to immediately save on these pesky fees and save some money?
One thing is to reserve and/or list your property on Vacation Angel.
Vacation Angel is offering vacation rentals owners one full year of 0% commissions! It’s free to list and owners will not even pay a processing fee which they would incur if they billed the traveler directly.
The price you set on Vacation Angel is the price you will receive when you receive your payment if you set up PayPal as your payout method.
After the first year, the fee is only 3% thereafter for both the owners and the travelers, making Vacation Angel the lowest charging platform around.
Even after the first year, the 3% fee is less than the payment processing fees an owner would incur if they were to invoice the traveler directly.
Essentially listing with Vacation Angel saves owners money while keeping their calendars full.
In our example of the average Brantingham Vacation Rental, owners would save $779 and travelers would save $2855 if they booked on Vacation Angel.
Now owners, Imagine if you just simply increased your rental rate this year 3% and listed it on Vacation Angel. The bottom line for the Traveler would still be cheaper and that extra money could stay in your pocket.
Could you use an extra $1558 this year?
That’s what you would save if all your rentals this summer were booked through Vacation Angel
The best part is that you don’t have to choose. You can still list on Airbnb, Vrbo, and any other rental listing site at the same time so you don’t risk losing anything. You can list on multiple listings and see what works best for you. So if FOMO is a real thing for you, fear not.
Vacation Angels ical calendar makes it so you can sync your calendar with your other listings so you can let each platform duke it out for your available dates. What could be better? See which platform is more efficient for you at no risk.
If you ever want to know how you can list on multiple sites and increase your property’s exposure stay tuned. You can list on multiple platforms without risking double booking or confusion with dates if you have the proper tools. In fact, a channel manager is the primary tool that virtual property managers use to increase exposure for their client’s properties.
Read our how-to guide on how to choose and set up a channel manager that may be a good fit for you and your budget.
(COMING SOON) – Sign up to our blog so you wont miss it when it comes out.
With a little bit of time and patience, you could increase your vacation rental exposure exponentially by listing on multiple platforms. Over the years I’ve tested several and they have proven to be a great asset for me.
In my next Blog about Channel Managers ill tell you which one I use now and why.
If getting more exposure is something you think could be good for you but you don’t want to spend the time learning a new program or deal with the technical aspect of running a vacation rental marketing plan, maybe you should be looking into finding a property management company.
I can help you research and find what type of property management may be right for you.
In the next couple of weeks, I will be writing more articles explaining the different kinds of management companies and how to find one that’s right for you.
So sign up to receive our blog when we post them and you’ll know you won’t miss any of my advice.
Vacation Angel has no contracts and you can remove your property at any time. We only get paid if we bring you reservations.
Vacation Angel only lists properties that are waterfront so in order to list your property it will need to qualify.
Sorry everyone else. We want to stay niche and focus on a smaller number of properties to give our clients the best experience possible.
A market analysis is important for any wise business owner who wants to maximize the income of their property. If you’re not sure what your potential customers will find valuable, then the chances of your marketing resonating with them are exponentially lower. Understanding what other vacation rental owners are getting for rates as well as what they’re offering to attract travelers can help you understand how much you could and should be charging.
With a comparative analysis, you can find ideas for amenities you could add or improvements you could make in order to increase your profits. Failure to pay attention to the trends of your area and of local travelers’ desires can lead to a lower conversion rate and ultimately less revenue for you.
There is so much to know about the vacation rental industry and we’ve only scratched the surface here. If you’re looking for more information on how Vacation Angel can help improve your revenue check out all the additional advantages there are to listing with us.
Do you have experience with Property Managers? How did it go? Our readers would love to hear your experience in the comments below.