5 Red Flags to Look for on Airbnb and Other Vacation Rental Sites

Originally posted on US News, featuring Kris Getzie of Volo.

With the proliferation of vacation rental sites like Airbnb, HomeAway and TripAdvisor Vacation Rentals, you’ve probably tried, or at least toyed with the idea of, staying in someone else’s home. After all, with competitive pricing and more space and amenities than you would expect at a standard hotel, it’s easy to see why the key players in the vacation rental industry lure those seeking affordable, off-the-beaten path accommodations. In fact, Airbnb now offers more lodging options than heavyweights like Marriott, InterContinental and Hilton.

Yet, for all the advantages that vacation rental sites can offer, there are also a string of caveats and nightmarish tales that have left would-be guests wondering whether branching into the vacation rental market is a smart choice. “We’ve all heard horror stories,” says Kris Getzie, founder of Volo Vantage, a hospitality consulting firm. She suggests finding a vacation owner who does not “view the homes in their fleet as a commodity” but rather “actively engage[s] guests to experiences beyond what they could have thought up themselves.” With this in mind, U.S. News solicited advice from top experts for spotting common scams and smart steps guests and hosts can take to maximize safety and comfort.

Red Flag No 1: Sketchy Payment Sites

“Firstly, customers should always book through a secure service,” says Jeff Mosler, chief services officer at HomeAway. If a host suggests communicating off the official vacation rental platform, that could also be a bad sign, he says, especially if they are offering a service or product that isn’t available through the rental vacation provider. It’s also important to trust your instincts and ensure you use a safe payment method, he says, pointing to the HomeAway Payments system, which allows you to pay with major credit cards and ensures automatic coverage of up to $10,000.

And according to TripAdvisor Vacation Rentals spokesperson Laurel Greatrix, another major tell is being asked to pay through an instant wire service or bank. Instructions to pay a wire transfer to the bank account of a vacation rental site, such as TripAdvisor, FlipKey or Holiday Lettings, could be a scheme, she says. “We’ll never ask you to do this,” she explains. “If you pay through us, payment is taken through our online systems, never by bank or wire transfers.” Greatrix advises booking through the TripAdvisor Vacation Rentals’ payment platform to be automatically ensured with Peace of Mind coverage, a protection that insures the payment is not sent to the homeowner until a day after a guest has checked in for his or her stay. “Paying online and protecting your payment is the safest, securest way to pay,” she adds.

Airbnb advises guests to connect with hosts through their website to prevent phishing scams and help protect you from fraud and other risks. By paying through the platform, you can help secure your personal information, and you can rest assured that your booking will be covered by the site’s cancellation policies. Plus, interacting online allows hosts to be covered by the site’s Host Protection Insurance program .

Red Flag No. 2: Limited or No Reviews

“If the listing ad just seems too good to be true and there aren’t any reviews, I recommend to do a cross-search on various sites to be sure someone didn’t copy the listing as a scam,” Getzie says. She also recommends calling the prospective host as a safeguard for a faulty listing or unreliable property manager.

Mosler suggests calling the homeowner on the listing site as well as conducting a quick Google search or social media search of the prospective host to ensure a trustworthy experience before providing payment. He says reading traveler reviews can also be helpful. “With the Wild West nature of the Internet, sometimes fraudsters go to a third-party site like Craigslist,” he cautions. For homeowners concerned about fraudulent activity, he recommends counteracting scams with sites like TinEye.com, a search engine that allows you to input a property image and then directs you to where the image can be found on the Web.

Airbnb also recommends that guests protect themselves by asking for references, reading traveler-submitted reviews from Airbnb guests and looking to see that host profile pages display a verified ID badge. These IDs are issued by Airbnb after a user or host connects personal social networks, confirms personal information or supplies an official ID.

Red Flag No. 3: Shady Rental Agreement

When it comes to identifying vacation rental contract loopholes, “there can be many and they can be varied,” Getzie says. A smart way to ensure you’re covered if you’re a property owner is to get in touch with an attorney licensed in the jurisdiction of your vacation rental, she says. And as for guests, she says the key is obtaining a short-term rental agreement that comes in the form of a booking confirmation or lease if you’re communication directly with a property owner. She also suggests carefully reviewing the contract. “If you are booking through a vacation rental site, review the owner’s uploaded rental agreement, and the site’s dictated cancellation policy, as both will help [you] understand potential issues,” she cautions. She also suggests that vacation owners purchase insurance either directly through the vacation rental site or on their own, pointing to an emergency like frozen water pipes as a potential issue you’ll want to have covered by your policy.

Greatrix also says that while booking contracts can vary, if key components are lacking, like arrival and check-out times and cancellation policies, it be an indication of suspicious activity. And according the Mosler, in a good contract, typically the payment terms, including the security deposit and cancellation policies, along with the types of amenities, are clearly outlined.

Red Flag No. 4: Suspicious Rules or Restrictions

It’s also important to keep in mind that “not all cities allow nightly rentals, and others require business licenses to operate,” Getzie says. “And any [municipality] has the authority to shut down an illegally run business, if a guest is staying there or not (potentially leaving you without accommodations),” she adds. To ensure your prospective vacation rental is in fact legal, Getzie says it’s a smart idea to conduct a Google search on the short-term and vacation rental as well as transient rental licenses available in your desired destination. “And by all means, ask the owner/operator if they have a current business license if they are required,” she adds.

“Rules and regulations can vary considerably from city to city, state to state and country to country,” Greatrix explains. She suggests doing your homework and understanding the varied requirements across the U.S. by visiting the Short Term Rental Advocacy Center website, which offers regulations for short-term destinations in a variety of locations.

On Airbnb’s site, you can navigate to a “Your City’s Regulations” section, but not all cities are listed. Conducting your own research is especially critical if you’re planning on traveling to an unfamiliar destination or visiting somewhere overseas. Doing so empowers you to understand individual regulations by town, city, country and state, as there are different tax regulations, zoning restrictions, safety and health standards and licenses required.

Red Flag No. 5: Request for a Wire Transfer, Expedited Payment or a Discount

If a property owner or vacation rental site asks for a wired or international transfer, that’s a major red flag, Mosler says. A request for a discounted payment or expedited payment could also be a telltale sign of a scam, he adds.

Another suspect behavior to flag: a request to pay the full amount too early, Greatrix says. “You shouldn’t be asked to pay the security deposit (usually up to 25 percent of the total booking) and settle the full cost of the rental until about eight weeks before your vacation,” she explains. And if there’s a switch in the email address of the person you’ve been communicating with during the booking process, that’s another clue of a possible scam, she adds.

Dwellable Q&A

This Q&A was for Dwellable and can be found here.

1) How did you get into this business?

My parents have owned and operated vacation rentals and boutique Inn’s for nearly twenty years, so the industry and it’s transformation have always been a huge part of my life.

After establishing my individuality, career and finishing grad school, I knew it was time to make the transition into this industry full-time. First by taking over the operations of my parents businesses and consulting on the side, then buying my own.

In a way, I was destined to be here. Not just because of my parents (they aren’t into free rides), but because of a deep interest in economic development. Responsible and sustainable tourism provides significant means for lesser developed countries to address their fiscal, environmental, healthcare and education situations.

I’ve also spent time working with a variety of organizations and governments addressing these issues as a hospitality consultant… It’s completely rewarding.

2) Tell us a story about the absolute best or absolute worst vacation rental experience you’ve ever had.

My friends and I were in Culebra, Puerto Rico, at my parents VR, when we met a retired couple who regularly hosted guests on their catamaran. They were locals (kinda) and offered us a trip. We hopped onboard.

I’d never sailed prolifically before, so that was a great experience in and of itself… But the way they hosted us forever shifted my perception of what a great VR experience should be.

They let us into their lives; showed us how they prepare for a trip, how to cook on board, drink like sailors (literally, Sailor Jerry—the rum—was a flowin’), tie knots and brought us diving at amazing little islands we would have never visited otherwise.

Of course, they had the details of their stay perfected and I still remember the smell of their sheets. Literally, one whiff of sea salty-butter-pineapple and I immediately want to be on that boat (talk about a retention strategy).

They were entertainers. They shared fantastic stories about their experiences sailing, history of mariners and took us all out of our comfort zones. A decade later, the girls and I still talk about that trip!

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3) How is the rise of mobile devices changing the vacation rental business?

Mobile strategy often refers to developing a mobile website that enhances the overall vacation rental search and booking experience.

I think it’s important to embrace this. But with 68% of smartphone users sleeping within two feet of their phone, it’s equally important think beyond the mobile website as devices have the ability to enhance guest engagement on a more personalized level before, during and after their stay.

Integrating an app, for example, provides guests with an easy way to control their experience.

They might buy mountain lift passes, a spa package or view a virtual tour before arrival. During their stay they might want to request additional maid services or book a dog walker. All great ways to drive ancillary revenue, by the way. I also think most owners could benefit with an app after departure by continuing engagement. Not stalking! But to say thank you, invite them back and ask for a review.

Mobile devices are also great for face-to-face interaction if you can’t be there physically. I had a guest FaceTime me because he couldn’t figure out the ski rack. Within two minutes I was able to guide him through the problem. It was super easy and it was nice to cyber meet in our PJ’s 🙂

4) Word of advice to VR owners?

Always be authentic.

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The most successful VR owners I have encountered consistently show their personality and have an ability to connect their guests to the local culture, in their own way. Consistent VR industry standards are obviously important (in terms of cleanliness, communication and so on) but the one thing no one can ever duplicate is your authentic and unique presentation of an experience.

I love what Vayando is doing. Once they are established, I hope to see them connect with vacation rentals to enhance the overall travel experience!

5) Insider tip for travelers in your area?

Regardless of what brings you to Park City, collect locals as your wingmen. They are guaranteed to be interesting people and will give you a fantastic day-in-the-life tour!

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They’ll bring you to backcountry slopes you’ll never see otherwise (maybe not via snowcat, but you’ll get there), insane bike routes (mountain or road), sketchy food trucks with delicious grub, or random concerts outside of Park City (Twilight Concert Series, for example, features the likes of De La Soul, Beck, Thundercat and local artists… for $5!).

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Kris Getzie is Founder & Principal Consultant at Volo, a hospitality consultancy, and she loves to help her vacation rental and boutique hotel clients crush with an amazing brand and dialed operations. She is obsessed with chocolate, learning, random adventures and getting her two kids out to explore the world.
Follow her on Twitter @volovantage or at www.volovantage.com.

Mountain Money

Volo was recently on KPCW’s Mountain Money show with Larry Warren & John Wells to discuss a little of who we are and what we do for our Vacation Rental clients, specifically. Kris Getzie is on around minute 45, for the last 15 minutes of the show.

Click here to listen!

Want Independence From Listing Sites?

From discussions on-line in vacation rental boards, with clients, to my own personal thoughts, I’ve noticed an acute desire for owner independence and more control than what traditional listing sites allow.

Unless you pay a premium fee, your vacation rental may not see top search result placement on the big vacation rental sites. Airbnb, for example, lets their algorithm determine if you are featured on page 1 or 100 (which is largely undisclosed but does include ad completeness, photo’s and reviews).

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The arguments for independence are based on incorrect information regularly provided, inadequate brand and business control, lack of home visibility, and fee’s. Commissions per booking are increasing across the industry, which hurts owners. Booking.com charges 15%, for example.

Despite the conversation around this topic lately, I don’t think these companies are bad. They help me book a lot of nights! There are certainly opportunities, but many are run by great people who are receptive of feedback. I love the folks at Tripping and I love the way the executive team from HomeAway communicates with owners on platforms like Linkdin.

I do understand the want/need to establish some independence (or complete, for certain owners).

I have developed brand-on websites for my rental homes, in conjunction with marketing on large vacation rental sites. Because of this, I have been able to achieve 100% occupancy during the SLOW SEASON; I urge my clients to do the same.

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For those without the budget for customized website design, WebChalet has great templates, built in reservation and payments options and is owned by two great people! Did I mention they only charge $15/month?

The problem therein lies the issue of traffic; you are just one property in a very big crowd of competition.

If your brand isn’t exceptionally attractive, you don’t have a base of guests and/or if you don’t have a detailed marketing plan, you may have to rely on big vacation rental listing sites at first, or continually, for traffic.

Sunshine-Coast-SEO

SEO (search engine optimization) can surely help your independent web site’s Google placement (think key words in URL/descriptions and blog for frequently updated content), but is becoming increasingly more difficult as competition grows.

Due to the nature of this task, I’ve heard a lot about ‘marketing co-ops’, if you will, for vacation rental owners.

Essentially it’s hyper-local rental site, or directory, that links travelers to independent website of homes with a consistent standard.

The co-op is for vacation rentals NOT those represented by a manager. Strictly homes that are run by owners who desire to create a marketing network that draws more traffic, a business standard in the industry and ultimately shares the best of the area. I think it’s an interesting idea for Park City.

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Maui Owner Condo’s does a great job of this and My Palm Springs Getaway is off to a great start, too.

Managers have an advantage; they refer guests to a different home should the one of inquiry be booked. A local co-op allows owners to run their business successfully, on their own terms, and also become comfortable referring (and receiving) guests from our competitors.

I’ve literally emailed home owners (with similar properties to mine) when I have been booked. 80% of the time I get zero responses back. I was handing them a booking!

Why would I do that, you might ask? I’ve met up with said owners, at later dates, and they asked!

I’ll tell you; those guest will come back to me because I was helpful and integral in planning their vacation… long-term profitability in this business is about being hospitable from the start (regardless if they are your current customer or not). This has proven itself over and over for me.

Any way, a co-op network seemingly also creates a platform for on-going discussions about the local industry between owners; trends, problems, wins and how to improve our guest experiences overall. In the end owners are all on the same team- all wanting to create exceptional guest experience, interaction and have a profitable hospitality business.

Do you want to be independent from listing sites? If so, would you consider joining a local marketing co-op for vacation rental owners? I’d love to hear what you have to say!

 

Tripping Partnership!

Volo is happy to announce a formalized partnership with Tripping, the world’s largest search engine for vacation rentals!

In addition to blogging regularly on Tripping, Volo will develop a prolific series of vacation rental resources to help real estate investors achieve higher occupancy and profits. We have already been hard at work creating books, tutorials, podcasts and webinars and look forward to sharing them with you and our new partner soon!

As a special Easter treat and our first Tripping blog post, here are 5 more Secrets to Vacation Rental Profits (in addition to those posted yesterday with Nancy Tallman).

If you have specific topics you would like us to cover in these resources, please leave a comment or send me an email (kris@volovantage.com)

Ebook :: Vacation Rentals for Newbies

Volo’s first guide to help you start a vacation rental business is available!

Our goal is to help new real estate investors create a solid business foundation, differentiate their property and ultimately drive a big profit through this get-to-the-point guide. Our secrets will help you succeed without a property manager!

Volo!

Thank you for stopping by our new website!  We expect the makeover to be complete by May, 2014.  In the interim, you will notice on-going changes to the design and format to best serve our clients needs.  Please feel free to contact us at any time with any inquiry. 

Volo’s mission is to help vacation rental owners succeed! We will teach you how to increase occupancy and profits in your real estate investment without paying a property manager tens of thousands of dollars.

Best, The Volo Team.

info@volovantage.com