Vacation rentals have the potential to generate a range of income for a homeowner. However, after purchasing that fabulous condo in La Paz or the golfer’s retreat in Arizona, will you opt for a property management company?

Choosing to go it alone or use a professional management company is one of the biggest decisions to make for your investment property. It’s important to look at the value a professional management team can bring, plus the pros and cons of managing the property on your own.

Vacation Rentals and Return on Investment

Many buyers purchase a vacation home with zero plans to rent it out and turn a profit. But when the property is going to be used as a rental, it’s essential to consider what type of return on investment it might bring.

Return on investment or ROI is how much profit you make in return for the money invested. Generally, it’s expressed as a percentage. On average, a ROI of 10-percent or higher is considered within an acceptable range for an investment property (Forbes). To get the highest ROI on your investment, multiple factors need to be considered with a focus on how the property will be managed.

Typical Responsibilities of a Landlord

Owning an investment property and opening it for vacation rentals means you now have responsibilities as a landlord. While the role of the landlord for a vacation rental is different from owning a multi-unit apartment building, there are some standard responsibilities that all property owners face. These may include but are not limited to:

  • Maintaining a rental property that is livable, safe, and clean
  • Handling routine maintenance requests
  • Dealing with unexpected maintenance issues
  • Collecting rental payments
  • Dealing with renters who default on contracts and/or payments
  • Cleaning/preparing the home or unit for new renters
  • Securing new renters
  • Marketing the property

In addition, a landlord often has to hire various professional service teams to handle things like lawn care and landscaping, pool cleaning, and snow removal if the property is in an area that receives wintry weather.

There are a significant number of responsibilities to handle when you’re the owner of a rental property. But, they may not fall into the “con” category for everyone. It really depends on the individual property owner, their abilities, and how much they want to be involved with the day-to-day running of the rental.

What Does a Property Management Company Do?

Before you can determine if hiring a property management company is what you need for your vacation rental, it’s important to look at what they do. Management services want your property to succeed as a rental. The more successful the rental is, the higher the profits and the better ROI for you, the investor. A higher ROI means you’re more likely to continue working with the management company. It’s a partnership where everyone benefits.

A property management company has multiple responsibilities to the owner of the unit or home and to renters. If you choose to hire this service for your vacation rental, these are a few things you can expect the company to do and most fall into the “pro” column:

  • Marketing the property
  • Manage bookings including collecting rental fees and any taxes required
  • Handle day-to-day details. From after-hour maintenance requests to ensuring the property is properly cleaned and rental ready
  • Hire and manage subcontractors as needed

In general, they will manage the numerous details of renting out the property and keeping it ready for when the next guest arrives. The downside or the “con” to hiring a management company may be their fee, but it’s critical to weigh that number against the multiple positives.

Pros and Cons of Property Management Companies - Marketing

Marketing the Property

Marketing a rental property goes beyond listing its availability. A multi-prong approach is needed if consistent bookings are desired. Nobody wants their vacation rentals to sit empty. Empty rentals deflate the ROI.

The management company has the expertise to prepare the necessary marketing materials that will help generate excitement and interest in the property. They will take exciting photos of the interior and exterior, write the property listing, and include it on their professional website. When it’s live on the company’s website, potential renters can easily scroll through pictures, information, and book quickly. And you don’t have to do anything.

Typically, a property management company can effectively market a vacation rental better than an individual owner. The company has resources and a platform in place which often has superior technology services. Plus, often times, they’re a brand that has already established trust and loyalty to its consumers. This is a significant benefit for an owner of a vacation rental.

If you opt to go it alone and manage your investment property with help, you’ll need to invest in the marketing structure and materials that a professional company already has, plus establish a trusted reputation as a rental owner.

Manage Bookings

Managing bookings for vacation rentals can be a full-time job. Handing that aspect over to a professional company saves time, hassles, and may even save money. If you’re not available to answer questions or coordinate guest stays, those potential renters are likely to turn elsewhere. A property management company will handle bookings via their website and through a designated phone number.

Handle Day-to-Day Details

Property management companies like Casago are hands-on. We free you from the day-to-day details that come with owning a rental property. You don’t have to worry that your Playa del Carmen home has sand in the entrance hall left by the last guests. We hire professional housekeepers that work hard to ensure that your home is always rental-ready. Moreover, when your home experiences a disaster such as a water leak, we’re there right away!

What if a guest has a maintenance issue during a stay? No worries. The management company calls a repair specialist and makes sure that the guests’ stay isn’t impacted negatively.

The day-to-day details also include Casago supplying everyday items like light bulbs and batteries, linens for the beds, towels, and even installing a wireless router for the convenience of your guests. The owner’s responsible for the property’s furniture, appliances, decor, dinnerware, and cookware.

Plumber Repairing Sink Pipe Leakage - Hiring Subcontractors - Pros and Cons of Hiring a Property Management Company

Hire and Manage Subcontractors

In addition to housekeepers, various subcontractors may be necessary as well. Many owners simply do not have the time to interview and contract with these professionals. A property management company will work with the groundskeepers, a snow removal company, pool service, emergency electricians or plumbers, etc. You can rest easy knowing that not only your property is being well-cared for, but your guests are as well.

Ideal for the Long-Distance Investor

The long-distance investor can’t be on-site to deal with day-to-day maintenance issues or do a walk-through before the next guests arrive. Long-distance investors may not know or have many connections in the area. That can make it difficult to hire reputable housekeeping staff and other subcontractors. Because of the numerous responsibilities that go hand-in-hand with owning a vacation rental, it’s often more convenient and even cost-effective to hire a property management company.

With a company like Casago, you get an Owner-Centric™ approach. The property owner is at the center of everything we do. Being a long-distance investor should never mean being distant from the business of your rental. We are the owners’ advocates and that helps provide peace of mind. Property owner support is available 24/7.

Beautiful modern dream home - Pros and cons of hiring a property management company

Do the Pros Outweigh the Cons?

For many investment property owners, the pros usually outweigh the cons when it comes to hiring a property management company. This tends to be especially true when it’s a single investment home. The owner lives a long distance away, and the owner doesn’t need or want to be involved in the daily details.

Relying on a management company like Casago can save time, hassle, and help increase your overall ROI for the investment property. Our professionals care for every type of vacation rental, from apartments to condos and luxury vacation homes. We’re an established business with highly-trained property management staff. We want your property to be successful, for you as an investor and for your guests.

Casago offers the ultimate selection in vacation destinations because we’ve got decades of experience. We’re the professional, reliable property management company you need.


Oh hi there 👋
It’s nice to meet you.

Sign up to receive awesome content in your inbox, every week.

We don’t spam! Read our privacy policy for more info.