Adapting for Survival

Adapting to changes in the holiday home rental industry

The world is ever-changing. Technology is advancing and making life easier. Systems and processes are adapted, improved, and then replaced with newer systems. We have to stay ahead or be left behind as the holiday home rental industry progresses.

I grew up, along with most born before the 80’s, without the internet. Windows were for seeing the outside world, the mouse was a pest, and mobile phones were wired headsets mounted in the centre console of your car.

Music? 8-track and cassette tapes, then CDs/DVDs, then ipods, and now even large record stores have closed up shop and we’re all using Google Play or Spotify. The weather was reported by the local radio station or on one of 3 TV stations. Now we ask Google or Alexa for the weather forecast.

My iPhone just beeped and I looked to see a Facebook update from a guest asking about a late availability booking. So I sent a quick text to the manager on duty to check the property and forwarded an SMS response to the guest. A minute later the home was booked, payment was received, and the guest was packing for their holiday.

Lightyears ahead of where we were when I first entered the self-catering home letting industry.

 

Embracing change

While I am a technology junkie and have enjoyed so much change in the past 30 to 40 years, it can be exhausting. I completely understand when I hear people lamenting the good old days of holiday home rentals.

Were the days when you greeted and spoke with guests in person and could develop a relationship before they ever booked; you knew their children’s names and they probably came back year after year.

I’m sorry to say, those interactions are, same as the Walkman, becoming extinct.

Guests don’t book a year in advance in most places anymore. Now they will leave the planning to the last minute. They now book for a couple of nights rather than the traditional week and would rather not speak to the owner at all. In fact, it’s much more like booking a hotel these days.

That said, as holiday home owners, we need to get used to even more unrelenting change coming our way. We can’t afford to be complacent, adopt a head-in-the-sand attitude, and hope it goes back to the way it was just as you’ll never visit a Blockbuster video to view the latest movie release. The whole industry is changing, particularly with Online Travel Agents emerging, Guest Expectations growing, and Regulations by governments.

 

Online Travel Agencies

We’ll see more change coming from the OTAs as competition in the market becomes dense.

The billion-dollar industry giants have the upper hand when it comes to marketing properties. They’re also constantly changing their practices. Don’t get me started about cancellation policies or algorithms that determine where you appear in rankings.

As the OTAs compete for the title of market leader, they’ll continue to make changes, test out the policies that work for their competitors, and improve systems along the way.

The first thing you might notice is a drop in inquiries, then a reduction in bookings. By the time you’ve gotten on board with the latest change, it might be too late to make a difference to improve your season.

Follow the Facebook groups and forums where these things are discussed. You don’t need to respond, but you’ll learn a lot. The Hosting Journey is a popular group where many owners share their opinions and thoughts.

 

Guest expectations

“You’re not buying the home. What do you expect?”

These words are commonly uttered by owners, usually in response to a variety of complaints, from unwelcome pests scurrying the floors, to dust bunnies under the beds or Wi-Fi that cuts out regularly.

Most owners believe that anyone who takes a trip to the country should be prepared for a traditional rustic experience and expecting higher standards is unrealistic. It’s a view rooted in a failure to appreciate how guest expectations have changed over the past few years. Holidaymakers are no longer tolerating substandard accommodations.

The basic expectations are for a property to be spotless, all amenities to be available as advertised, furniture to be comfortable, and for technology to be up to date. Beyond that, the assumption that service calls will be handled immediately and repairs carried out within hours with no disruption to their holiday is common. Again, self-catering is becoming more like the hotel industry.

Is it any wonder that the hotel industry has seen the growth in whole-home rentals and began expanding with self-catering accommodations. Marriott, Hilton, and Choice Hotels can replicate their hotel style service in a holiday home rental setting and meet the rising expectations. After all, they’ve been doing this for decades and their movement into the space is well-explained in this New York Times article:

“Most home sharing guests leave positive reviews of their experiences, but when they do complain, it’s often about cleanliness, last-minute cancellations by the host, problems with check-in or an unmet need at the property they have rented. The hotel companies say their private lodgings are vetted, outfitted and maintained to hotel standards. In addition, the hotels say, services at their lodgings are provided by company employees rather than homeowners.”

If independent owners refuse to listen carefully to what their guests are communicating, accept their demands for higher standard in both commodity and service, the writing may well be on the wall for them.

 

Regulations

If there is one change we can be sure of, it’s in regulations and legislation. Few locations have been spared the impact of taxation over the years and investors need to do diligent research before entering the industry in any capacity.

As the opposition to holiday home rentals becomes more vocal and sure of its position on affordable housing and neighbourhood concerns, changes in legislation will be much more likely. This has been demonstrated recently in Amsterdam where there is a total ban on non-resident rental activity. Regulations are being discussed in hot zone markets like Dublin, Cork, and Galway as the homelessness and housing shortages are on the rise.

Being aware of current and pending regulatory activity has never been more important than it is now. While you might feel settled paying your regular accommodation VAT, don’t take your attention off what might be legislated in the future.

Remember: Nothing remains constant except change itself. Expect it, prepare for it, adapt to it, and you’ll be on a path to success.