Advice for New Business ?

Question

I am starting a new Business in Hollywood, FL and feel pretty safe using this forum for Brainstorming, and fishing for Ideas.

My Business Plan is to set up a Full Service Weekly Rental Agency for the tourist area in this city. There are literally 100's of vacant units that sit on Hollywood Beach where the owner is too Lazy to worry about renting weekly, or is burnt out from renting weekly, or is trying to sell because the "Monthly Rent" for a unit down there doesn't cover the Mortgage. There is often No Vacancies down there when I go to the beach so the activity is coming from somewhere.

However, a place that rents out for $1000 a month, will rent out for $650 a week (Conservatively).

There are currently no Active Local Companies handling this area of Real Estate, and I know If I get in, hit the pavement, and make some waves, that I could set up a pretty successful business in no time.

A majority of the Tourists who come into town for weekly stays are from Canada.
There is a Large Airport, FLL, that most Tourists use.

With those details, does anyone have any Ideas. I'm not looking for answers, I have a plan, but theres no harm in throwing the idea out here to the wolves and getting some feedback, so CHOW DOWN!

My main concern is Advertising, and the Appoach.

How do I get the Tenants?

I am Confident I can get unit owners to hire me. I am offering to handle all aspects of the transaction, Finding Tenants, Accepting Deposits, Checking In, Check Out, and Cleaning Service. I wouldn't need to spend a whole lot of money finding the unit owners, if any at all, so the costs there are Minimal.

Jason F · Answer

I have used CL also, but to tell you the truth, I think 90% of it is a waste of time. Sometimes you can get good deals or find something you are looking for, but a lot of times it's just shady people or time-wasters. Just my experience. But there is no doubt you get get some good deals on things.

Dan Nguyen · Answer

I haven't been on the business side, but for my latest vacations, I look to Craigslist for accommodations. Maybe I'm telling you something you already know, but when you're advertising property for rent, I suggest doing some posting there. HTH, Dan

Philip Rowe · Answer

I am feeling pretty good about it! Thanks for all the feedback so far, and I got a few ideas from the 3 of you too. Open Realty is something I will have to check out. I've written a few websites in the past, but have yet to get my head around css. (php I can handle), but I don't want to spend all of my time tinkering with code when I can being doing more productive things. I spent a lot of time in the OBX; and weekly rentals ARE the market there. I am limited by COA's, or HOA's here, but I think the company can be lucrative if I can attract 6-10 cherry picked properties to start. There is a market for it already, and a few National websites that are generic and most of them have the owners handle the transaction. My target is the Absentee Owner, who has a furnished unit, and doesn't have the resources to rent the property weekly. Properties that rent for $1000 a month are getting about $700 a week if it were a vacation rental. Absentee owners can still have their own property when they come into town and it can generate income. At 50% occupancy they can essentially "Break Even" if the property had been rented on a YEARLY contract. I agree I think the website can go up ASAP, start driving traffic now. This could be my most valuable market, and I like the idea of approaching the tourists that are here now. There are a few legal questions that I am researching, and once I figure out the answers I will began approaching property Owners. Any lawyers on here?

Jon Holdman · Answer

Do some searching for "Hawaii vacation rentals" or "Kona vacation rentals". I'm most familiar with the Kona (Kailua-Kona, west side of the big island) area. There are several large companies that control a lot of condos in different buildings. Sunquest is one name that comes to mind, and I think there's one other really big one. A number of smaller ones and some agents that have units in just a building or two. At least out there, this seems to be a big business. You might try similar searches in your area and see what pops up. Few hits could be good or bad. Might mean there's no competition, but might also mean there's not much demand. The author of "Four Hour Work Week" really emphasizes test marketing. He has a number of approaches for doing it. One is to offer your product or service even if you can't really deliver right away. Set up a web site to try to draw in traffic, and lead the browsers through the process of trying to sign up. If browsers go deep enough that they would have signed up, you know there's real demand. Could try some test letters to owners, too, to see if there's interest. The units (at least, all I've ever stayed in) are fully furnished with bedding, kitchen stuff, TV's, everything. Its like a hotel, but better because you have lots more space and a kitchen. Except for Vegas, this is always my choice for a vacation. Usually there is no daily maid service. There is a cleaning charge at the end. The best web sites are the ones that have calendars of what's available online. Lots of pictures are a must. Typically some deposit ahead of time, then payment in full some time before the rental date. Refunds are limited, especially if you cancel very close to the dates.

Jason F · Answer

Great idea. I think you are on to something that could potentially be huge. I think from the owner's aspect. They want some cash while their unit is sitting there, they don't want to deal with stress of renting it out, and they want it to stay clean and look good after the tourists are gone. Not a problem. Spell out everything and make it care-free for them to let you rent out. You get a key, you deal with the tenants, you take their deposits, you hire the cleaning crew, basically they get nothing but get a check. I don't see why someone wouldn't want to do that. It's a quick $500 pop for letting someone stay in your place. Advertise to owners by sending direct mailings to "FOR RENT" or "FOR SALE" signs. For the tourists, you would probably want to set up a website with multiple property listings in the area. I think Open Realty is a free web design tool that is made for this kind of thing. Then you would just get on some pay-per-click ads for people searching for "Miami Beach Rental". That should start kicking up your traffic and getting people looking at your site. Once the site is pumping, you are set, it will sell itself when it comes up on search engines. Here's a couple of things off the top of my head: Beds, Couches, Sheets, pillows, towels, dishes, etc. Will these be provided for the tourists? Will the owner need to purchase these things? HOAs: I know a lot of HOAs have some pretty strict rules on renters and they must get approval. I'm pretty sure some of these HOAs will completely rule out having weekly rentals, but others may not (or not even notice). Might have to be a building by building thing. Great idea though.

Christian Malesic · Answer

Great idea! This is one of those businesses that are hard to get off the ground, but have huge potential. You mention the 2 biggest concerns: new owners and new tenants. The seconds begs the advertising question. Getting the owners is a matter of being honest with the first two or three and giving them an offer they can not refuse... such as no fee to you unless you rent it out, ie. a percentage fee of rents. Once you get the places (owners) you can go after the tenants. Find out if they are coming from a particular area of the country. You may be surprised. If they are from a small town or towns, advertising may be much cheaper than you would imagine for a newspaper or church bulletin, not to mention direct mail. The best part of your idea is the residuals. We vacation at the same beach and same beach apartment complex every year. The most advertising they need is a letter saying “you better call me quick and send your deposit before your favorite apartment and week is gone”