Avalara MyLodgeTax > Blog > Industry Insight > Property management for your short-term vacation rental

Property management for your short-term vacation rental

  • Apr 6, 2018 | Heather Bayer

When to use a property management company

For many owners, self-management is just too much of a time-consuming prospect. They prefer either a fully hands-off approach, or a more flexible arrangement where they can hand over some aspects of the process to a third party and maintain a lesser involvement.

Property management companies vary in the services they can offer, from a complete package that takes care of everything from furnishing and prepping a place for rental, to marketing on multiple channels and managing the end-to-end guest experience. Others may do a part of the process such as the advertising, marketing, and communicating with guests, while you take care of the practical side of creating the magic for them.

Before you decide on a property manager, make a list of the tasks you’re prepared to do, or want to do, and those you’d like to be done for you. This exercise alone can be very helpful in determining how much time you want to spend on the business.

Selecting a property management company

Property managers have two distinct types of customer: 1) the owner, for whom they deliver a range of services, and 2) the guest, for whom they supply information and reservation facilities. So, when you look for a company to represent your property they should not only deal promptly with your queries and concerns but must also provide excellent service to the people that want to rent. If it doesn’t do that, you won’t get the customers you need to rent your property effectively.

Good property managers pay equal attention to both owners and guests, and if they’re acting efficiently on your behalf you should expect a high level of service from them.

To get an idea of how the company manages their properties, read the reviews of homes in their portfolio on the popular listing sites. This can often give a great insight into their management and customer service practices. Too many reviews that cite cleanliness or communication issues could indicate where problems might occur. On the other hand, if the management company is consistently being praised for their help and support to guests, you may have found a gem.

It’s a partnership

You need to feel comfortable with the company you choose. It’s a personal thing. You have to be confident in their ability to match the right guests to your property, and deal with issues that may arise. You want them to understand your concerns and help you every step of the way with recommendations based on a lot of experience. In short, it should just feel right.

10 questions to ask

You’ll want to feel confident they’ll work well on your behalf, so make a list of questions and ask the same ones of each company. The questions will vary depending on the level of services you’re expecting them to provide. Here are some general examples:

  • What are your opening hours and how do you respond to inquiries after hours?
  • What is your target response time to inquiries?
  • What sites will you list my property on?
  • What social media channels are you most active in?
  • How do you ensure we get the right guests for our property?
  • What happens if something gets broken or damaged?
  • Who do guests contact if they have a problem and how is that dealt with?
  • What local regulations apply to rentals and how do you comply with them?
  • What short-term rental associations and organizations are you affiliated with?
  • How and when do I get paid and are lodging taxes remitted on my behalf?

Cost of property management

Owners who self-manage often cite commission costs as a reason for doing the business themselves, and it’s certainly an important factor. However, cost-cutting by a couple of percentage points can make the difference between a professional management company working solidly on your behalf and one that cuts corners to save dollars here and there. Keep in mind the following words of wisdom from Benjamin Franklin that are as relevant today as they were in the 18th century: “The bitterness of poor quality remains long after the sweetness of low price is forgotten.

Property manager rates vary, though not as widely as it may seem from a first glance at their rate sheets or websites. Some charge a flat commission rate that is payable only when the property is rented; a few have an initial setup fee and advertising charge, with a variable administration fee per week; and most charge guests a fee for booking. Commission rates vary from 12 to 40 percent and may depend on different variables. Doing your homework thoroughly will indicate where you’ll get the best value, but remember that the old adage also applies, “You get what you pay for.” Good marketing is expensive and what you get for an extra 1 or 2 percent may be maximum occupancy compared to empty weeks.


The primary role of a rental agency is to market your property effectively and get maximum occupancy. Just listing your property on their website is no longer enough, and they need to have a wider marketing strategy that includes a number of advertising outlets. Although you can do it yourself, the benefits of using an agency with their marketing experience and breadth can often outweigh the commission costs. Ask if your property will be distributed to other marketing channels outside their website.


When you contact property management companies, they’ll want to arrange a viewing of your property. Even if you’re inviting several agencies to view, expect them all to take photographs and carefully question you on the facilities and amenities available, as well as any restrictions you may want to impose. When you appoint the agency, they’ll have the photographs and information so will not need to revisit.

Make sure the property is staged well inside and outside for both interior and exterior photographs. If the weather is poor, or the season prevents the best exterior shots from being taken, have a selection of your best photographs available for the agency representative to view.

Making the decision

The best advice is often the simplest. Go with your gut. If you get a good feeling from the people you’re dealing with, you’ve checked out their experience, and you believe they can provide you with good value for the commission fee as well as good occupancy, then don’t overthink it. Most agencies offer very similar services at a similar fee, so your decision may be based more on how you feel than financial factors.

For more insight from Heather Bayer, visit Cottage Blogger or attend her annual Vacation Rental Success Summit.

Lodging tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Avalara Author
Heather Bayer
Avalara Author Heather Bayer
Heather Bayer is CEO of one of Ontario’s leading rental agencies, CottageLINK Rental Management, with an inventory of just under 200 waterfront properties. She has also owned and managed six of her own rental properties in Canada. As author, content creator, and blogger at www.cottageblogger.com, host of the Vacation Rental Success Podcast, and cofounder of The Vacation Rental Formula, Heather has been immersed in the vacation rental business for over 20 years and loves to share what she has learned along the way.