How to Choose a Property Management Company for Your Airbnb
Running a property as an Airbnb comes with a ton of responsibilities. Not only do your guests expect 24-hour service, but you also have to manage reservation requests, cancellations, negative reviews, turnovers, and more. And how on Earth does the average person keep up with this?
Many landlords hire property management companies instead to take the load off. It’s the best way to turn your investment into a passive income stream and offload some of the work.
So if you’re in the market for a Property Management Company (PMC) to help, here’s a handy guide to help you choose the right PMC for your Airbnb business. Each of the items below will help you weed out the good ones from the bad ones.
#1 – Ensure They Offer Complete Coverage of Services
Given that the property management company should make things easier on your end, they should offer a wide range of services. Anything that they don’t do means something extra on your plate. In other words, you want them to handle your Airbnbs as much as possible, to make your life as easy as possible.
Check to see that your PMC can offer the following:
- Professional photography for updated pictures
- Professional write-ups for appealing advertising
- Listing creation for multiple short-term rental platforms
- Price optimization to get the best profit margins
- Guest screening prior to acceptance
- Around-the-clock concierge service for guests
- Dispute management and resolution
- Guest check-ins and check-outs
- Cleaning services (including laundry)
- Property maintenance and repairs
#2 – Vet for Professional Certifications and Licenses
Next, check the credibility and authenticity of the property management company. They should have proper certifications and professional licensing to back up their expertise and service. Thankfully, there are trade bodies that offer certifications, programs, and reviews that property management companies often complete.
We suggest you ask to see the following:
- Certified Residential Management Company (CRMC)
- Residential Management Professional (RMP)
- Master Property Manager (MPM)
- Certified Project Master (CPM)
- Real Property Administrator (RPA)
- Broker licensing examination results
Note that not all property management companies will have these certifications, as you’ll also have to check what credentials are required in your specific area. Nevertheless, the main goal is to ensure that the company is legitimate.
#3 – Ask For Experience and Knowledge in Short-term Rentals
The more experience and knowledge they have of the local short-term rental scene, the better they’ll be at handling your Airbnbs. You don’t want to work with a property management company that’s only getting started, you want to work with those that are already at the top of their game.
So, ensure the property management company has the experience and knowledge required to handle the following:
- Boosting your Airbnb search ranking
- Optimizing listings through social media
- Listing properties on multiple vacation rental sites
- Developing effective marketing strategies for attracting new guests
- Pricing your short-term rental competitively
- Providing local recommendations to guests
- Email marketing for retaining and engaging with past guests
- Knowing the high and low seasons of the local market
- Staying updated with current local, state, and federal Airbnb laws
#4 – Check for Reasonable Property Management Fees
Affordable rates don’t automatically mean cheap service. But, you do want to work with a property management company that doesn’t overcharge. In general, property management companies offer two payment structures:
- Fixed Monthly Rate: You’ll be required to pay the property management company a fixed monthly rate regardless of how many bookings you get.
- Commission Rate: You’ll be required to pay a portion of your total monthly earnings, which usually falls between 30% to 50% of your total revenue.
There’s no one answer about which payment structure is better—you’ll have to crunch the numbers yourself to see which option makes more financial sense. Take your time, weigh the pros and cons, and ensure that paying the fees will still earn you a good amount of profit.
#5 – Sign a Comprehensive Property Management Agreement
Lastly, check the contract with a fine-toothed comb. The agreement should elaborate on the relationship you and the property management company will have, so read it carefully before signing on the dotted line.
Here are the key things to look out for in the agreement:
- Ensure that the entire service coverage is included
- Ensure that each service provided has its corresponding fees
- Ensure that any additional expenses are listed clearly
- Ensure that the contract outlines the responsibilities of each party
- Ensure that the tasks you don’t want to do are assigned back to the company
- Ensure that start and end dates, breach of contract rules, and termination timeline and fees are clearly stated in the contract
Agreements with property management companies are usually signed on an annual basis. Whenever it’s time to sign the papers again, take your time to make necessary adjustments, discuss all your concerns, and remove any adverse clauses.
Pro Tip: You should also take a look at their host ratings on Airbnb. That way, you’ll get a more honest idea of how they operate professionally from a third party.
Find the Perfect Property Management Company
The perfect property management company will make your life a million times easier. They should work with you instead of against you, becoming your ultimate partner in handling your short-term rentals. The more capable they are, the more profitable and passive your real estate investments will be.
Get in touch with us today!