Determining Monthly Rates for Your Vacation Rental Home

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There is one important factor that should figure into your decision of how much to charge for a month’s rental of your vacation property: When the inquirer is requesting the reservation. For this reason, it is important that you change your monthly rates according to the seasons. It’s best to add a line in your listing stating that interested people contact you for the accurate rate, instead of displaying different numbers on your ads. Hopefully the criteria below will help you with determining what to charge for a month at your rental home.

Typically 4 weeks is considering a month in rental terms. If someone is requesting a reservation for 4 weeks in your peak season, offer no discount! For example, it you rent your $1200 a week during your busiest season, a monthly rate would be $4800. You don’t want to offer a discount in the peak season because, even if the person seeking the month doesn’t rent from you, it is highly likely that someone else will rent those 4 weeks individually, which will make you the same amount of revenue.

If the person contacting you is asking about the rates of a month during the off-peak season, a small discount can be given since there is no guarantee you would rent those weeks out to another person. I would recommend charging a monthly reservation for at least 2 weeks of the normal rate. Let’s say you rent your vacation property for $800 during the off-peak season. A good monthly rate during this season would be $1600-$2000.

In the even slower seasons, it would be acceptable to provide an even greater discount. You probably aren’t going to get anyone else asks about the weeks in question, so it’s better to get something for them than nothing. If you normally charge $600 in your slowest times of the year, it would be good to charge approximately two weeks rate for the entire month. In this case, $1000-$1200 would be a good rate for the month of the slowest time.

Your monthly rates should change depending on which season the reservation will fall into. No discount or special rate should be given during your busiest season, but you should cut a deal for those interested in renting your vacation home for a month during your slower times. Doing this will still earn you money, and will get your vacation rentals booked for more periods of time in the off seasons.

Tips & Warnings

• Don’t get greedy! If you price yourself out of the market, renters won’t even call you to negotiate. Be reasonable and fair, and you’ll get a fairly high occupancy rate.
• Beware of pricing too low. Pricing a property too low may draw in some poor rentals such as underaged kids attempting to throw a party and possibly even worse!

September 1st, 2008 Posted by admin | Vacation Rentals | 2 comments