We didn’t plan on being vacation rental managers. It sort of just happened, with a lot of work along the way!
We now have an income-generating property that we can use for our own family vacations at no cost.
I may do a few posts to dive into the detail of this endeavor, but here’s the gist of it! In the meantime, stay at our cabin if you’re looking for a mountain getaway.
How We Started
Our foray into vacation rental management started because we wanted an affordable family getaway from the sometimes claustrophobic Los Angeles metro area. We wanted a place to go on weekends where the air felt cleaner, the pace felt slower, and people felt friendlier. For several months we checked out open houses in mountain areas that had options that we hoped would fit within our modest budget. We soon realized that our dream would be a whole lot more feasible if we were to treat our family vacation home as a vacation rental instead. (Note that there are some tax decisions to make here and some personal use restrictions if you go the income property route – maybe I’ll do another post on that soon).
We narrowed our search to more touristy spot, something that felt a bit counter to our personal preferences but that has proven very useful from the vacation rental standpoint. We found an adorable little A-frame that we loved, and after months of researching the market, we jumped on it. It took us a few months to get the required permits and get the cabin outfitted and ready for renting. I had a baby during that time as well so that slowed things down a bit!
Self-Managed vs. Property Management Company
When we started, our hope was simply to have the cabin pay for itself from a vacation rental standpoint. We called a few property management companies in the area and were disappointed to learn that they charged a full 30% of the rental income at that time. Wow! That would certainly eat into our bottom line quite a bit, and we weren’t confident that the cabin would be self-sustaining in that scenario.
The idea of self-managing a property hours away from our home seemed daunting, particularly with two full time jobs and a new baby. However, we went for it!
Almost three years later, we have a clearer sense of the pros and cons of managing it ourselves.
Self-Managing is a Lot of Work!
It has certainly required a lot of legwork. Finding cleaners, maintenance workers, plumbers, electricians, and snow plowers on our own took a bit of doing. There are lots of hours spent communicating with each guest, managing the calendar, dealing with damages and security deposits and high maintenance guests.
Also, we are on call at all times. We’ve received so many “oh crap” calls that require us to drop everything and jump on an issue at the cabin. Once, the heater broke on a weekend evening in the winter and finding a repair person who could arrive before the pipes (or the guests!) froze was a hassle. We got a call at 4am that a late-arriving guest couldn’t open the lock box. And a call while we were on vacation elsewhere stating that the guest had clogged the toilet and needed an emergency plumber visit. It never fails that we get an issue at the cabin when we have other personal chaos going on. Sometimes it is really tempting to put it on a property management program. Maybe we will one day.
Self-Managing Means More Money and Control
There are a couple things we really enjoy about managing the property ourselves though. The first is obviously the added revenue. The property management companies will tell you they can net you more income. Do your homework though. We asked for rental income data on a few comparable properties managed by some of the area’s popular rental management companies, and we have been able to exceed their net income. Of course we didn’t know this going into it, but now we are glad we took the leap of faith.
Another plus to self-managing is the control it provides us. We can stay at the cabin whenever we like and block of any days we want to use at a moment’s notice. We have full control of our rental calendar at all times. We can block of dates for visiting family, offer unused days to friends last minute, or donate a weekend stay for a charitable cause and not worry about when those guests may want to book. Managing the property ourselves also gives us insights into potential guests because we are communicating with them directly. You would be surprised at how many people say crazy things in their emails like: a) asking to throw a party at our place that exceeds maximum occupancy; b) informing us that they’ll be bringing animals that violate our pet policy; c) telling us they’ll just be sleeping a few extra people on site, or d) asking how much noise they can make. Really? Given that we can lose our rental license for many of these types of violations by our guests, self-managing allows us to ward off some of these potential issues.
Is it the “Side Hustle” for You?
Overall, this has been an excellent way for us to have a very affordable (free!) family getaway nearby. It has not been an enormous money maker in the near term, but we are developing equity in the property that will give us financial flexibility in time. Let me reiterate – this is not passive income! It requires a lot of up front leg work, and a lot of time coordinating on an ongoing basis. It is not for everyone. However, we love getting back up to the cabin to get outdoors, go on familiar hikes, and see the lake in all seasons.After all, who wouldn’t like the chance at these types of views and adventures?
Don’t forget to check out our cabin if you need a place to stay in Big Bear, CA.