photo by Mary Cavanaugh
I am on family duty. Part of that has been helping my youngest daughter at her beach home in Florida. Her car broke down and she has a big client who has flown in from New York. She’s newly licensed and obviously wants and needs this sale. I drove down so she can use my car to meet her client. (Don’t feel too sorry for me. I snapped that picture the other morning hanging out on the beach. Temps have been in the mid 70’s. Dude – it’s January!)
Why am I telling you this? My daughter’s strengths are in helping her customers see the ROI on investment properties. She managed property here and got so many inquiries about selling that she got licensed.
Serious players of the Money Game may feel their ears perking up. What? Investments? Real estate?
I’ve learned a lot following her around, asking questions and looking at ROI spreadsheets until my eyes have crossed (not really – I could look at data all day long especially when the charts are moving up).
One thing I learned is that today’s technology will let anyone work as a reservationist for a vacation home owner. You don’t have to actually live at the location to help customers with their questions. Many of these owners don’t enjoy this aspect.
VRBO (the biggest web site for finding a vacation home to rent) has been sold to Expedia. There have been lots of changes and even glitches. A patient person who can work through computer issues can help an owner improve their booking rates. Additonally there is at least one software platform that will tie in multiple listing sites and integrate their calendars making it easier and more effective to get more bookings. I’m looking into that now. For example, many owners here are old school and haven’t even begun to use Airbnb.
This may be the side hustle that is not terribly labor intensive but could help one earn more money for buying real estate down the road. It requires:
- great people and communication skills
- an understanding of how vacationers book and pay for a vacation home
- a decent computer or laptop
- a good phone with a reliable connection
- a need to answer phone and email inquiries promptly from the morning well into the evening
- the ability to learn how VRBO and similar sites work (if their rules aren’t followed, the property won’t rank high when customers search)
- the ability to follow up with existing customers to get more bookings
- an ability to figure out how to find your first vacation home owner who needs your help (and hopefully as many more as you’d like)
Since I don’t live here, I won’t physically manage the property’s cleaning and maintenance. This is strictly entering bookings online and answering questions when prospective vacationers inquire.
This is a job you’d advertise on your own. I’m working on an ad to place locally and I plan to charge 5% for one (and only one) client. The going rate is 10% but I need one client to learn the ropes and I’ll advertise as such. Once I’m comfortable, I can start asking for referrals and advertise for new business. At that time, I can raise my rate.
It will be easy to measure performance. I’ll make a spreadsheet capturing the home’s income for the past year and then measure what I’m able to do. I’m confident I can adapt to VRBO’s changing rules and stay compliant. If I’m understanding Carmen correctly, they also measure response times and I’m good with that. I like to help people and I’m not terribly busy. Responding to emails and phone calls won’t be an issue for me (and it was never was when I worked in the corporate world. Customer service was always the part of my performance reviews where I got the highest scores and the people I served liked me.)
To give you an idea of earning potential, let’s say an owner has a vacation home that rents for $1,000 a week (that’s pretty low for a beach house but I want the math to be easy). Our owners aren’t tech savy and they are really busy people. They haven’t had the time to read and implement VRBO’s new rules. They also don’t know that there are lots of new platforms now to use. They typically book 8 weeks a year bringing in $8,000 plus taxes and cleaning fees.
Let’s pretend I take over and spend a good week properly listing the home. Phone calls and emails trickle in. Customers can tell I’m helpful and responsive. The home looks great (I’m not going to enlist a home that’s a dump) and bookings increase 50% over the next season. I bring in $12,000 plus extra fees and send all the money to the owners. I invoice them 5% for the rental which will be $600. (I’ll invoice monthly not yearly though.)
In that example, I really won’t make much for my time. In reality, the spreadsheets I’ve seen with real data for this area have been $4-8k a month income. I’m willing to take on a low performer as long as the home is decent to learn how to help customers make their reservations and how to properly list a vacation home.
If I land a good client, I may use some Money Game funds to upgrade my phone. It’s an iPhone 4s and trust me, it’s time.
I’m so glad I structured the Money Game as a game. It gave me the ability to set it aside while spending time with family this month. I thought about bringing things to sell but knew Carmen would need my car. I would have been listing yard sale things for a few dollars here and there and missed learning so much about how to make extra money in a new way. I’ve also learned a lot more about breaking into real estate investing. As that part takes shape, I’ll share it too.