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  • Duane Narine

The Bad Side About Short Term Rentals

Updated: Jan 23




Everything you’ve absorbed in previous posts has not included the downside of this business. Brace yourself because there are negative aspects of this business. As with any business you choose to run you will no doubt encounter challenges and things you just don’t like doing. The list below is based on my ten years of experience in this Business. Maybe I’ve been fortunate but the list below is nothing I couldn’t handle and certainly nothing that turned me off from this business.


Damages

As with any rental strategy be it Long Term Tenants or Short Term Tenants, you are running the risk of damage to your asset. The damages can range from minor wear and tear such as scuffs on the walls, carpet staining, raised flooring from wear and tear, worn out upholstery, broken dishes, stolen items, etc.


Major damages are what you want to concern yourself with and this can cause an interruption in your rental activity leaving your property potentially uninhabitable for an undetermined period of time. These damages can be anywhere from broken toilets that need to be replaced, broken faucets that need to be replaced, water damage due to negligence by your guests, fire, etc.


Fingers crossed that you never encounter damages to or within your property but you can certainly expect wear and tear over time. A fresh coat of paint can easily fix up the minor wear and tear on your walls which isn’t a big deal at all.


Insurance Claims

With the proper insurance policy in place - you have your bases covered should you have to make a claim. The drawback however is that if you are making a claim then likely the damage is substantial and would likely cause your property to be unusable for a period of time.


Shifting Guests Because of Damages

Sometimes you have to be the bearer of bad news. In the event that your property has to come offline due to damages, you may find yourself in a predicament In which you can no longer honor a reservation or reservations. While this is an unfortunate scenario, my best advice is to be upfront with your guests and let them know the situation. You will find some templates of emails I have had to use in the past that have helped me to get out of these sticky situations. It’s worthwhile to have these templates on hand in case a bad scenario arises. You may be pleasantly surprised that your honesty will yield you a positive response in the end. I have had the fortune of not having many of these situations and getting out of them with ease because I was simply just honest with what had happened. This won’t always work and when it doesn’t then you may be faced with cancellation fees depending on the avenue your guests booked through.


Loud Guests

Loud guests can be a problem, a big problem. In most cases your rental property will be very close in proximity to neighbours. If you operate in a condominium or apartment then surely you will have neighbours. If you are operating out of a house in a densely populated area then you are bound to neighbours. Your rental business in both above mentioned scenarios is ultimately done in a community. A community that generally would expect respect. The volume your guests carry will leave an impression on your neighbours. Your property in their eyes may have hawk eyes on it from your nearby residents and while those eyes can’t stop what you’re doing, it’s always best to be liked rather than the opposite. Your neighbours can actually be an asset to you should you need a favour in regards to your business. Since they will be the closest ones to your property that you can call on, it’s best to have a good relationship with them. Educate your guests and have rules in place for them REF RENTAL AGREEMENT. If those rules are broken and you are notified by your neighbours or noticed by property management within the building then you will want to rectify the situation immediately. Great things come when you show respect.


Overstaying

Guests leaving past your set check out time can pose a threat to the quality of the clean by your cleaners. Your cleaners whether it be yourself or a team you’ve hired should have ample time to turnover the unit(s). When a guest chooses to leave later than expected for whatever reason, you end up suffering.


You may encounter cases where your guests completely forgot their check out date. If you happen to have a gap after their set departure them great, but if not then find a kind way to have them leave. It’s an unfortunate circumstance but it can certainly happen. We are human, we make mistakes. I only mention this at it has happened. Most people don't really forget when they have to depart but it can happen.


Bad Reviews

Poor reviews can really be detrimental to your conversion rate. A lot of travellers will do their homework and find whatever possible information they can about your listing. The easy info they can look up are the reviews and if your reviews are consistently sub par then you will most definitely see a decrease in bookings.


The beautiful thing about bad reviews is that it gives you insight on how you can improve things. Take the action and make those improvements. Look at your reviews like your report card you received in elementary and high school. Even with stellar reviews there is always room for improvement. Your aim should always be to give your guests a superior experience. It’s never fun to read a bad review but don’t take it personal, just make the necessary changes.


Unnecessary Emails and Calls

This isn’t completely a bad thing but it does take away from the time you could be spending doing other things. Unnecessary emails typically will arise from poor execution of your rental. What I mean by that is that you haven’t communicated or given enough resources to your guests and thus they have to contact you. Along the way you will encounter the gaps you’ve overlooked but if I can say one thing to you about this segment, think like a traveller. If you were booking a short term rental what information would you need to know. When you walk into your booked short term rental property what are you immediately looking for and imagine yourself as a traveller in your unit for one night. Sometimes it’s even a good practice to stay at your property from time to time in the beginning so you can see how it feels and what information you can relay to your guests so that their stay is not only comfortable but easy.


Refunds

Refunds suck. Giving back earned revenue isn’t fun but it’s part of business from time

to time. You can certainly state no refunds across all of your listings but a case may present itself in which you must or should give a refund. For example: your cleaning team didn’t perform to expectations and upon evidence of this you may want to give a partial refund of the cleaning fee. You missed a payment on your cable and internet service and thus this amenity is not available. Guests expect wifi or internet connection when they travel and if you’ve advertised your place with free wifi then you should uphold this end of your bargain otherwise some funds back would likely be an expectation by your guest or guests. Put it this way, if the cause is on your end then really consider refunding part of the reservation amount. The refunded amount is at your discretion. Sometime it’s a small price to pay for a great review and especially when you act on situations quickly. The small price to pay for gains down the road. We talked about reviews and how they boost your conversion.


Double Booking

One of the worst things that can happen is that you’ve double booked. I shamefully say it has happened to me twice over my last ten years. It never should have happened even once though. When this happens you’ve ultimately compromised your guests. My first instance involved me having to put a family of 6 up in two hotel rooms for a week. The cost was heavy and it was during peak season which exaggerated the price. You learn from

costly mistakes but apparently I didn’t as it happened again about a year later. My tactic on this instance was to be honest about what happened and hope for the best. Fortunately the guest cancelled their reservations with me on their own accord and no costs to myself were incurred. Regardless of the cost though, it’s a huge inconvenience to your guests and you also run the risk of a poor review. Incorporate a good calendar system. The one I use is called Team Up, it’s free and there is an app you can download so that you can manage your calendar on your phone without your laptop in front of you.


Now that wasn’t too bad was it? If managed properly though you can avoid the pitfalls listed above. This is why this guide has been created so that you can learn how to operate your business efficiently and have it run like a well oiled machine.

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