Why are my bookings down?

This is the question of the day.  I have taken three calls in the last 24 hours from homeowners wanting to make a change of management for their vacation rentals.  Two of them self-managers, the other with another company.

My first question is always "Why do you want to make a change?"  Right now, the hot button is "I'm not getting enough reservations."  While I am all about working with new clients, my response is usually "not so fast!"

In the Smoky Mountains, reservations are down this January and February.  A big company we are not, but we have enough statistical data to offer some reliable numbers.  In January, we are currently off 27 percent in rental revenue, to date, based on this day a year ago.  That figure is derived from something we call a "Pace Report".  It tells us how we are trending compared to this exact date one year ago.  There isn't a single one of our properties that isn't down some over last January.

So relax.  The drop in volume isn't necessarily indicative of poor management on your part or someone else's.  This industry has cycles, and I have been writing about the impending down cycle in the Smokies for about a year now.  

WARNING: ROUGH TERRAIN AHEAD (biggerpockets.com)

What can I do to perk up my activity?  If you are self-managing, make certain that you have professional photos, a thorough (but not too wordy) description, and competitive rates.  I spoke with a gentleman a few days ago who said (paraphrase) "I don't want to get too cheap, or my guest quality will go down."  That is a myth.  Folks that are going to the time and trouble to plan a vacation to the Smokies in January and February and rent a house, are not low-class people.  Don't make business decisions based on assumptions and myths.  The properties that represent the best value will rent.  It's far better for your property to rent at $150 per night than sit empty at $250 per night.  

If someone else is managing your property, make certain you aren't encumbering them with onerous requirements such as minimum rates that are far too high, an unwieldy damage deposit, or a three-night minimum when many folks are just looking for a place for the weekend.  Consider changing your strict no-pet policy.  

Happy Investing in 2023!