Vacationing Outside The Big Box Hotel

Posted by Nick Niesen on October 29th, 2010

The Internet has proven to be a natural tool for potential real estate buyers. You can check out homes now through MLS listings that provide multiple photographs, room sizes, heating and cooling features, landscaping and more. Gone are the days of getting in a car and driving to home after home with a real estate agent who is guessing at your tastes.

The same is proving true with vacation rentals. Resorts have long marketed their facilities online, but the use of the web for individual seasonal rentals is just hitting its stride. It has proven to be sufficiently successful that venture capital has entered the arena and a number of homegrown websites for vacation rentals are being acquired and consolidated.

The biggest player in the consolidation market thus far is HomeAway, a two year old company that is backed by $160 million in VC dollars and has engaged in a number of acquisitions, quickly building critical mass in the online seasonal rental business. Homeaway's most recent and biggest purchase has been VRBO, or Vacation Rental By Owner.

VRBO claims 60,000 individual listings and more than 20 million site visits per year. Other acquisitions that created the HomeAway business structure include http://CyberRentals.com, http://GreatRentals.com, http://A1Vacations.com, http://TripHomes.com, http://Holiday-Rentals.co.uk in the United Kingdom and FeWo-direkt.de in Germany. These and other properties give HomeAway a catalogue of 60,000 rentals in 90 countries. In two years, they have grown very quickly.

Vacation Home Rentals remains a web presence with over 14,000 listings, principally in the sun-n-fun states of California, Arizona, Hawaii and Florida. Vacation Rentals also remains a strong web presence, with a hefty investment in search engine marketing. Their home page lists virtually every state and several continents with countries listed beneath them.

On all of these sites, seasonal rental property owners pay a fee to list their property and post photographs, floor plans, fees, etc. On HomeAway, the cost is $300 to list your property for one year. There is no charge to customers who wish to rent. Generally, the sites simply provide referrals and the rental arrangements are negotiated between property owner and vacationing tenant.

An example of such a listed rental property is Moose Back Lodge, which maintains listing on HomeAway and other major rental sites, as well as its own website: http://www.moosebacklodge.com. Many owners maintain their own websites in addition to securing listings on rental directory sites, allowing them to provide a kind of online "business card" for the propriety that isn't tied to a particular directory's formatting. Direct, owner operated websites provide opportunities to allow the personality of the property to show through in the design and information presented on the site, as well as the ability to better control the content.

There are also real estate agencies that provide regional rentals in popular vacation areas. States like Maine, North Carolina, Florida and many others will have realty companies that handle vacation rentals as a sideline - managing properties for absentee landlords. These websites usually have excellent photo and text descriptions of their properties, along with a calendar of available dates. In many of these cases, rental arrangements are made through the agent.

Then there are facilities in tourist areas that handle their own marketing. These include major and minor resorts and B&Bs. Often a small facility such as a B&B will link to a regional B&B marketing web site or a local chamber of commerce. There are also large developments built around recreational facilities such as lakes or skiing facilities that handle seasonal rentals for the people who buy the condos and houses built as part of the development.

Planned developments in recreational areas are often second homes for their owners, but also income properties. In the larger ones, the developer will often have a permanent office for both sales and seasonal rentals. In these cases also, the rental agency acts as property manager and handles both rentals and maintenance for the owners.