How (our) vacation rental management works

How (our) vacation rental management works

Dear “foreign owner”:

Here is a brief introduction to our company. If you already own a house in Trieste and are contemplating the option of turning it into a source of income by letting us handle vacation rentals on your behalf, the following lines can be useful.

If you are (also) looking into buying a house, and can handle reading Italian, have a look at this article too.

Otherwise, drop us a line at owners@triestevillas.com, and we’ll take it from there.

 

We’re a company born in 2013 for vacation rental management.

To this day the team is composed of 12 full-time people, plus about 20 seasonal workers (primarily for check-in and assistance).
We usually start by having a look at the property: we already know – based on the past years of statistics – how much revenue an average house in any given area of Trieste generates, but before exposing ourselves with numbers, we really need to get a detailed picture of the situation.
Within a couple of days, you will receive a report which states our economical forecasts both on the income part and on any expense which might be needed to prep the house for your first vacation rentals.
The wrong attitude is “let’s start with the basics, and if things work fine we’ll buy all the other stuff”.
Houses need to be perfect on Day One otherwise the first negative reviews will compromise forever your ranking on Booking.com, Airbnb and so on.
In that same report, we’ll let you know the exact percentage of our commission.
It depends on several factors: potential of the house (the larger the better, so we can settle for a discount), and the amount of work which we’ll need to put into preparing that specific place to welcome the first guests.
The average is 30%. Rarely more (it happens on very small properties), often less (in case of ready-to-go high-end apartments which have great potential).
We’ll then go through the paperwork to triple-check that everything is perfect:
We basically need to prove that the electrical and gas systems are up to date,
and that the official floor plan of the house actually matches reality.

 

 

If all is sorted, the handyman and the person who will do a “Quality control” (check whatever small item may be missing – usually kitchenware), will have a second look at the house, to anticipate any possible technical malfunctioning and prepare a “house manual” with all the answers to anything which might go wrong.
We’ll then look into any possible suggestion for wasting less money on bills: for example in case of autonomous heating systems, we strongly suggest installing a Netatmo (or other wifi) thermostat, in order for us to control it remotely prior, during and after any winter rental.
We then need 5 copies of the keys (2 for tourists, 1 for the cleaning company, 1 for our office, 1 for emergencies/caretaking). 
Once the contract is settled and we’re ready to go, we will return with “props” (flowers, fresh fruit etc) to take the photos, make a promotional video and scan the place with the MATTERPORT 3d technology.
We’ll then bring all the paperwork to the public offices from whom we need the authorization (it takes a couple of days). This will grant us access to the Police Portal which is used to communicate the name of every paying guest.
We’ll be then set to go online.
We’ll start by publishing on Booking.com, Airbnb, Homeaway, Expedia and TriesteVillas.com
Total number of online portals on which we can publish listings is about 30, but the major (and almost exclusive) ones are:
Booking.com with an average of 50% of bookings, TriesteVillas with 30% and Airbnb with 20%.
All other websites sum up, according to the specific property, to no more than 4% of revenue.
We then set up the pricing policy and follow the connection to our revenue management software (it updates automatically every 24 hours according to the demand/offer curve of similar vacation rentals and hotels in the same area of Trieste). This auto-pilot is then manually corrected every couple of days until we settle for the perfect pricing policy.
Whatever the booking, the standard scheme is the following: 
PRICE PAID BY GUEST
     – CLEANING
     – VAT (Italian VAT on tourism is 10%)
     – PORTAL FEE (18% Booking.com, 6% Airbnb, 0%offline Triestevillas, 5% Online TriesteVillas)
     – TRANSACTION FEE (0% on cash, 0.5% on ATM mode, 1% on credit card)
     = NET INCOME
The net income is split 70% to the owner and 30% to our company.
Taxwise, we have to keep 21% from their net earnings and pay them out directly to the Tax Office.
   
On the 15th day of every month, we pay the owner – by bank transfer – for what he has earned the previous month.
Once this is done (a realistic estimate for all of the steps above is 3weeks), we’ll be up and running.
We’ll handle bookingspaymentscheck-inassistance during the stay, extra servicescleaning (including linen, toilet paper and courtesy sets).
Personal linen and towels need to be stored away (in any wardrobe) since we’ll bring out own sets.
You will receive an Owner access to our backend, in which you’ll see which bookings are confirmed at which conditions in which dates, and you’ll be free to create any “Owner booking” for whenever you wish to come (or send friends over), in dates which are not already booked.
We do not take responsibility for any damage the tourist may cause, but we try to handle the problem on your behalf.
If something is broken or ruined, we keep the deposit (usually 200€), but for amounts exceeding 200€ we suggest the owner to insure the house with an insurance contract with costs around 180€/year.
The beauty and magic of our company is (and should continue being) the “human side”: 
We’re not a normal commercial real estate agency, but as you’ll have a chance to understand, we’re the problem solvers who just handle an extreme complexity of unpredictable stuff, giving both owners and tourists the peace of mind of knowing they can rely – for any kind of issue – on us.

A key concept to keep in mind is that we earn based on how much income we bring in your pockets, so it is in our best interest to do everything we can to maximize profit keeping everyone happy.

This is why we might start with a very aggressive pricing policy in the first months of life of a new listing, to then start raising prices gradually once the “online review reputation” is set.

What we also do is alternating “pure” vacation rentals with mid-term rentals to companies: in tourist season minimum stays can be set on a 2/3 night range, but in winter it is often better to look for any worker who needs the place for weeks or months in a row.

Everything has to be understood beforehand, and we’ll then set all the policies accordingly.

 

If you’re interested in having a deeper look in our company, an email to owners@triestevillas.com will do the job.

If you don’t own any property in Trieste yet, keep in mind that many of our properties are on sale too. This means that you can “try before you buy” and that we have a long record of statistics and data which will give you a precise idea of the return on investment you can expect.

Martino, Co-Founder.