Setting the Right Rates for Each Season: A Must-Read for Vacation Rental Owners
How to set specific rates for peak, shoulder, and off-season to maximize your earnings.
As a vacation rental owner or operator, your primary goal is to make money. The most effective way to do this is by setting competitive rates that attract travelers. You need to maximize your high season and, fill gaps during your off-season.
You’ll need to understand your market to increase your occupancy and revenue. This article is about determining your relevant rental seasons. By doing that you can set specific rates for each one. I just read an article on VRBO titled “How to master seasonal rates for more earnings”. I wrote this article as a response to that.
SEASONS
The first step to setting effective seasonal rates is to research your market. Determine the rental seasons that are relevant to your location. Most vacation rental markets have at least three seasons.
There’s peak season, shoulder season, and off-season.
Peak season is the time of year when travelers typically book their vacations. It is usually the most expensive time of year to rent a vacation property. During this time, the demand for vacation rentals is high, and prices tend to be at their peak. It is important to set competitive rates during peak season. You want to make sure you’re not leaving money on the table.
Shoulder season, on the other hand, is the period just before and after the peak season. It is usually cheaper than the peak season but more expensive than the off-season. During shoulder season, the demand for vacation rentals may be slightly lower. It can still be a profitable time of year for vacation rental owners and operators. Set competitive rates during this time to make sure your calendar is still full.
The off-season is when the weather is usually less than ideal for your vacation rental market. Think of main outdoor attractions, such as skiing or beach activities. During this period, the demand for vacation rentals may be lower, and rates tend to be the lowest of the year. By offering discounts and promotions, you can attract more bookings during the off-season. This is the time to make sure you maximize your occupancy rates. Communicate the benefits of booking during the off-season. Let guests know that there are fewer crowds and a more relaxed atmosphere.
To stay ahead of the competition, understand the demand and price trends. Set competitive rates for each season. Regularly monitor your occupancy rates and adjust your rates.
YOUR MARKET
To set effective seasonal rates, it is important to understand the demand in your market. For example, one of my vacation rentals is located in Big Bear California. There are several ski resorts nearby and families come up to enjoy the snow. I can charge and get much higher rates in the winter because of the high demand.
Different areas will have different seasons but, it’s not rocket science. If you don’t know your seasons you can probably get the information with a quick internet search.
MINIMUM STAYS
It’s also important to determine the minimum stay required for each season. In peak season, one week might be the minimum stay to maximize earnings potential. However, a shorter stay may be more effective during the shoulder and off-season.
DYNAMIC PRICING TOOLS
Using dynamic pricing tools such as PriceLabs is another thing that you can do. These tools can help optimize your seasonal rates, and maximize your earning potential. Dynamic pricing tools use algorithms and data to determine optimal prices. They use factors such as local demand, competition, and availability. By using a dynamic pricing tool you can adjust your rates in real time. They help to stay ahead of the competition and attract more bookings.
BENEFITS
Here are some benefits to setting effective seasonal rates for vacation rentals:
Increased occupancy. Competitive rates for each season attract more bookings and boost occupancy.
Higher revenue. Effective seasonal rates can maximize your earnings potential and increase your overall revenue.
Better guest experience. By setting competitive rates, you can provide guests with better value. This can lead to more positive reviews and repeat bookings in the future. OTA reviews are based on value, not luxury. Setting the right prices for each season ensures you are providing the best value for that time of year. If guests believe they got a good deal they will leave positive reviews.
Setting effective seasonal rates is crucial for maximizing your vacation rental earnings. With the right research and tools, you can set competitive rates for each season. You’ll attract more bookings, get better reviews and, increase your revenue.
