How does Vacasa measure as a vacation rental platform? Is it a good option for short-term rental owners?
Table of Contents
- What Is Vacasa?
- How Much Does Vacasa Charge?
- What Are the Pros and Cons of Listing Your Property With Vacasa?
- How Can a Rental Property Owner Get Listed on Vacasa?
- How Can One Find a Profitable Short-Term Rental Property?
- Wrapping It Up
In this article, we will learn more about Vacasa, its humble beginnings, what it set out to do, and how it performs as a vacation rental platform.
What Is Vacasa?
Short-term rental investors are looking for companies to partner with and platforms to list their properties on. While several companies like Airbnb, HomeAway, and VRBO immediately come to mind when talking about short-term rentals, there are other excellent options that real estate investors can consider.
Vacasa is one of such options.
Vacasa is a vacation rental management company that partners with over 35,000 rental property owners in the US, Canada, Mexico, Costa Rica, and Belize. At the time of writing,the company manages properties in 34 states in the country and is looking to expand to more.
Back in 2009, Eric Breon and Cliff Anthony co-founded the full-service rental company after the former encountered certain challenges in managing his Long Beach WA vacation home.
After several years of grinding, Vacasa property management posted a very impressive three-year growth rate of 3,035% in June 2014. The platform’s stellar performance in such a short time made Vacasa lead Portland Business Journal’s list of top 100 fastest-growing private companies. A couple of months after, it snagged ninth place in Inc. Magazine’s 5000 list of fastest-growing privately held companies with an updated 16,192% three-year growth rate.
In November 2016, the company placed 67th out of 500 companies on Deloitte’s 2016 Technology Fast 500, a list that recognizes and acknowledges North America’s fastest-growing tech companies.
Fast forward to today, Vacasa went public (NASDAQ: VCSA) on December 7, 2021, via a merger with a publicly listed company. It went public with a valuation of $4.5 billion. It meant that each of the 35,000 property management contracts under Vacasa was worth more than $128,000. Just a week after it went public, Wall Street Journal reported that the company raised $340 million. It made the Portland-based company for vacation rentals one of Oregon’s highest-valued companies.
The Whole Nine Yards
As a company, Vacasa is known for offering full-service rental properties management to its clients and partners. By full-service management, we mean the following:
- Marketing rental homes
- Clean up after the guests leave
- Perform regular property inspections
- Provide property maintenance coordination
- Set the most profitable nightly rates possible
- Screen guests
- Take calls even in the middle of the night
- Monitor the performance of Vacasa vacation rentals
- Give potential guests easier access to the platform using the latest technology
- Aid in processing documents, permits, and taxes
- And lots more
Pretty much anything related to the management and operation of a short-term rental property is already covered by the company.
Vacasa home management makes it easy for real estate investors to pursue other equally worthy business ventures. The company set out to make investing in short-term rental properties more attractive and lucrative for investors.
How Much Does Vacasa Charge?
Given Vacasa’s huge financial success since its launch 13 years ago, some folks may be curious about how much Vacasa rentals charge vacation rental property owners.
Many people start a rental property business because of its viability and profitability. VRBO and Airbnb business owners can attest to such a fact, especially property owners and investors in a really hot short-term rental market like Florida.
Real estate website Mashvisor regularly updates its database with the latest short-term rental data in almost every market in the US. According to Mashvisor, as of April 2022, there are 48,110 Florida vacation rental properties listed on Airbnb. The average monthly rental income for a vacation rental is $3,787, with a cap rate of 3.37% and a cash on cash return rate of 3.29%.
Experienced real estate investors and industry professionals know for a fact that Florida is known to be a constant top performer in the short-term rental industry. But the Sunshine State isn’t the only one where vacation rentals are highly profitable business ventures. Other states like Hawaii, California, Rhode Island, and Virginia are also great places for investment properties that will be used as vacation house rentals.
That being said, companies like Airbnb and VRBO typically charge 3% and 5% service fee per booking, respectively, while Vacasa charges significantly more at 20% to 50% per booking. It might seem quite steep, especially if your investment goal is to make a handsome profit. Given the numbers, one would typically go with the more affordable Airbnb or VRBO. However, investors also need to take into consideration that Airbnb and VRBO do not offer the same services that Vacasa does.
At most, other vacation rental platforms will help market the property, collect payments, and withhold and report taxes. They don’t go as far as Vacasa, which takes care of all property management concerns. Considering the amount of time and effort being taken out of an investor’s hands, Vacasa’s rates seem pretty reasonable.
Legit or Scam?
Many short-term real estate investors are a bit apprehensive about partnering with the company because of its higher rates and all-in services. On one hand, they probably think that the company is only milking investors out of their money. On the other hand, doing practically nothing but investing in a property seems like a too-good-to-be-true scenario.
So, is Vacasa legit?
The answer to the above question relies heavily on Vacasa reviews from both partners and guests. Top consumer review website, TrustPilot, shows a pretty strong rating for the rental property management company with 4.3 stars out of 5. While there’s the occasional negative feedback, seeing how most of the reviews reflect a positive and pleasant experience indicates that the company is 100% legit. After all, it would not be listed on NASDAQ if it were a scampany.
What Are the Pros and Cons of Listing Your Property With Vacasa?
Any business or investment comes with certain risks and rewards. It’s the same with getting a rental property listed on Vacasa, regardless if they’re single-family units, condominiums, or cabin rentals. Listing your rental property on Vacasa comes with its own pros and cons, just like listing them on other short-term rental platforms.
Let’s start with the downsides first.
One of the most obvious drawbacks of getting a rental property listed on Vacasa is the company’s 20% to 50% charge per booking. Investors want to get the best possible returns but with charges that go as high as 50% (depending on the property’s location), it becomes a turn-off.
Second, Vacasa is not as widespread as Airbnb or VRBO. While it is an international company (with partners located in Canada, Mexico, Belize, and Costa Rica), it is only present in 34 states in the US. Compared to Airbnb, it still needs to work on a lot of things.
And third, since it is not as widely used as the other platforms, it doesn’t get as many vacation rental reviews that a lot of guests rely on to make their booking decisions.
Now for the upsides of listing with Vacasa.
As a short-term rental platform, it pretty much offers the same features found in its competitors. From flexible scheduling and pricing to serving a great passive income source, Vacasa partners and users get to enjoy most of the benefits that go with using vacation rental platforms.
For one, other than generating bookings from its own site, Vacasa also gets bookings from the listings they put on Airbnb and other similar websites. Although the company is competing with them, it also uses them to market the rental properties under its care.
Next, it provides a mobile application that gives on-the-go users easy access to what they will need to make their vacation as pleasant as it could be. The app can be downloaded for both iOS and Android devices.
Also, there’s what they call the Matterport tour, which is a feature that allows potential guests to take a 3D tour of a property. The feature increases the saleability of the property and makes it very attractive to users who are very particular about its interior features.
But its greatest edge over the competition is it offers full services to partners where short-term investors can literally do nothing and yet still earn good money. This sets it apart from some competitors, such as Evolve rental management which is more focused on technology and does not offer the same full services. With Vacasa literally taking care of everything related to managing the rental property, investors enjoy more time and resources to channel into other equally fruitful and profitable pursuits.
How Can a Rental Property Owner Get Listed on Vacasa?
If you’re an investor and you’re considering getting into the short-term rental business, you will first need to look for a suitable property to convert into a house for rent intended for short-term stays.
It’s actually very simple as all you need to do is fill out the necessary details on the company’s page and submit it to get more information about how the property management company can help you and your rental business.
Other important listing elements are:
- Professional quality photos that entice guests to click through your gallery
- Matterport tour that allows guests to take a 3D tour of the property, which significantly boosts the number of bookings a property gets
- Competitive nightly rental pricing using a dynamic pricing technology
- Premium rental cleaning services that are compliant with CDC standards, which increase guest confidence in Vacasa-managed properties
- Professionally written property descriptions that leave very little room for doubt
- Vacation rental reviews that all the more increase guest confidence and drive more bookings
Since we’ve already established the benefits of getting a rental property listed on Vacasa, real estate investors should carefully reevaluate their investment strategies and give vacation rental properties a chance. It only takes enough dedication to do what needs to be done where research and analysis are concerned.
How Can One Find a Profitable Short-Term Rental Property?
When it comes to finding the right short-term rental property, one website’s already proven it can be trusted. Thousands of investors already use Mashvisor as their real estate weapon of choice to find the most profitable properties in their chosen real estate markets.
Investors only need to sign up for Mashvisor’s services on its website to fully enjoy the different features that allow users to perform property searches and real estate market analysis. Users can make highly accurate projections on their returns on investment to see whether a particular market offers something or if they should look elsewhere.
Three of Mashvisor’s most popular features are the Property Finder, Real Estate Heatmap, and Investment Property Calculator. While they all perform specific functions, they are all capable of finding the right investment properties that are right for every type of investor. One valuable feature that Mashvisor offers its users is the ability to conduct short-term rental analysis using the most up-to-date rental comps.
For your property search and real estate analysis needs, Mashvisor is the way to go.
Wrapping It Up
Short-term investors who are not yet sold on Vacasa should seriously consider looking into the company and the possibilities it brings. If your rental property isn’t a fit for platforms like Airbnb, VRBO, or HomeAway, perhaps going with Vacasa will work for you. Either way, the important thing any smart investor should do is always perform due diligence.
Gather the necessary information, analyze important market data, talk to industry experts and more experienced investors, and take time to study the platform to see whether it’s worth your time.
As far as looking for the right short-term investment property is concerned, you can always turn to Mashvisor. The platform helps you look for the best deals that align with your vision and checklist. By the end of 2022, Vacasa intends to list a total of 48,000 homes in the US alone. Perhaps you might be one of the lucky ones.
To get access to our real estate investment tools, click here to sign up for a 7-day free trial of Mashvisor today, followed by 15% off for life.