Government Impact – Zoning & Licensing are Key

Zoning and Licensing are the two twin sisters of success to your vacation home ownership experience. Local governments have a duty to regulate both and have made inroads to address the needs of the communities, residents, second home owners and vacationers alike. (No easy task)

“Due to concerns that the county’s current policies regarding the regulation of vacation rentals, also popularly known as short-term rentals, are overly broad and lacking clarity, the Washington County Commission voted to put a six-month pause on the approval of any new vacation rental applications for the unincorporated parts of the county earlier this month”

Reads a recent article from St George News where they reported a 6 month ban at the ‘County’ level on short-term or nightly vacation rentals by the County Commissioners. They are working to balance the interests of all parties and need time to “get it right” as the trend for nightly rentals continues its climb in popularity with investors and tourists alike.

If you’re in the market to buy a second home in Washington County it may pay to work with an expert in operations, management and zoning. Know the details before you buy.

If you already own a second home, and you’re thinking of ways to cash-flow it but are not sure about zoning or have questions about rates, management or marketing – reach out to us for a free no-obligation consultation. About 20-30 minutes of your time will produce a great deal of insight as you navigate the market.

Marketing & Promotion

Marketing and Promotion

Shows like NetFlix’s “STAY HERE” and other shows on HGTV are designed to entertain and like many ‘Reality’ shows often do not reflect our specific “local” realities.  Furthermore the market is in constant motion and requires sound principles and discipline over time to succeed.

Understand your market

Where are the guests coming from?  UT, CA, CO, AZ, ID, WA and CANADA are the top regions booking in St George.  It is important to also note that up and coming markets include Asia and colder mid-west/northeast states too.  COVID brought a surge from California as well as NY from all over the Northeast and Midwest regions.  Marketing foot print – Over 75% of guests are driving to the area and live within 600 miles of St George.  How old are they?  The average booking age of guest is 38.  87% are also families – not corporate travel.  (key – focus on marketing to families needs in your home)  How long do they stay?  In 2017, according to AirBnb data, the average length of stay in the St George area was 3.2 nights.  When do they book?  The majority of bookings are done by females (60/40) and they are booking on average 43 days in advance of the arrival date.  We are seeing a growing nightly average in the summer and people are planning more and more in the future.

In both setting up your property to appeal to the market and our focused marketing plan Escape Properties uses this and other data sources to try to drive occupancy with best possible rates to create a healthy balance of revenue.

Systems Investments- Escape Properties reservation software is designed to integrate with multiple channel marketing servies like AirBnb, VRBO, Google etc.  This means we can cast a broad net and communicate with guests in a single point

We have integrated with partnerships on both a with leading travel industry firms in California, Boston, Idaho and little old Utah.  All the tech, pomp and circumstance is for naught if it was not for the HUMAN team behind the effort.

This includes owners, cleaners, reservations team, guest service coordinators, maintenance team and support staff.  Our combined energies and focus is on the creation of an Amazing Guest Experience.

The Success of the Property

The operation and success of a vacation property business is not a complicated business model but there are many moving parts and details working with the traveling public, meeting expectations and keeping things current.  We see your success more as a full-time venture rather than a side job.  This is not to say that the individual can not have success self-marketing on AirBnb or VRBO.  They can and do. (This is why AirBnb is so successful as a whole)  Over time we see owners burn out and become tiered.  Properties loose their luster and eventually end up ‘for sale’ or in neglect.  Many first time second home owners are convinced that the property is always going to produce positive cash flow, when in reality most do not.  They fell in love with the idea they see on TV reality shows not the reality of running a second home business.  

The locals ‘Guide’ to owning a Vacation Rental in the Greater St George area

If your client or yourself are getting ready to buy a second home in the Greater St George area, and part of the economic strategy is to rent it out when not using it, then you may need some insight on what PUD’s or zoning laws allow, their associated ordinances and licensing requirements and general strategies to make the experience successful.

Escape Properties, a member of VMRA (the Vacation Rental Manager Association) and only National Association of Realtors designated RSPS (Resort and Second Home Property Specialist) firm has been managing and operating vacation properties since 2008 in the area with thousands of successful guest stays.  We have spent a great deal of time and effort compiling this information for your benefit.  Where possible we have contacted municipal authorities to get the most accurate and relevant information as possible.  


Feel free to reach out to us for a specific analysis of your vacation
property – no obligation.  (435) 414-1525 or email  kendall@escape2stgeorge.com.


Vacation Rental homes have been around for hundreds of years in Europe.  In the United States most vacation homes have been concentrated to sea side communities or mountain cabins.  In the last 15 years with the advent of what is termed as the ‘sharing’ economy there has been a boom in the FOR RENT by OWNER options across the country and globally.  

Communities like St George that are located near destinations like Zion National Park or the Grand Canyon or have developed a sports tourism options have seen a boom to nightly rentals and second home ownership.  

There are 20 individual cities within Washington County and all with vastly different approaches to short term rentals.  Not all areas are geographically ideal for a nightly rental business models.  As such this article will focus on what we term as the Greater St George area (90% of our population) and will cover the cities of St George, Washington, Hurricane, Santa Clara, Ivins and La Verkin.  The cities of Toquerville, Rockville and Springdale are  near enough to Zion National Park that we will address them in a follow up article.

 

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St George

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Washington

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Hurricane

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Santa Clara

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Ivins

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La Verkin

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Springdale

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Toquerville

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Pine Valley

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New Harmony

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Rockville

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Hildale

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Veyo

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Dammeron Valley

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Leeds

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Virgin

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Enterprise

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Apple Valley

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Central

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Grafton

Our team gets asked often “Where is the best place to buy” a vacation home.  The simplest core answer is – “where ever it is allowed”.  Sounds simple right.  IF the property is not permitted for nightly rentals, and you want to off-set your costs with renting it out nightly – you are wasting your time and our time thinking about it.  There isn’t enough money or motivation to deal with code enforcement violations, angry neighbors, tax implications etc. to be successful with non-zoned units.  (Unless you are interested in operating the property as a ‘temporary housing’ property.  Ask us for details on this option)

 

To help in our discussion, we need to review a few terms and types of lodging options one may encounter in Southern Utah.

Hotel/Motel
Zoned commercially or high-way commercial.  Located in town on major traffic by-ways.  Single rooms with single bathroom, mini-fridge.  Large parking lots, no group gathering areas without a fee, elevators, limited views.  We have a few nice hotels – clean, good amenities, comfortable – but we don’t much in the way of a resort hotel that you want to take a vacation to per se.  They are building one in Ivins near Tuacahn.  I think it will have its own degree of success but may or may not have any opportunity for private unit ownership.

Glamping/Yurt/RV

These are options, but will not be discussed in this review.  Glamping is ‘glorified camping’ and is usually in a YURT or Tent.  There are a few that have popped up in the area around Zion National Park and are popular with the urban camper.

Shared house
(room for rent).  Also known as the Airbnb Model.  Owner lives on site.  Offers a space in the home for rent, usually a room with access to a private bath but all other areas of the home typically are shared.  Grandma’s house falls in this category.  Usually only accommodates 1-2 persons but may vary.  (In St George, even staying at Grandma’s house is illegal IF you compensate the old lady in cash or in kind)

Guest house private space.  Like the room for rent, but more private.  Owner still on site but the unit is separate with private kitchen/kitchenette.  Accommodations for 1-4 people is common.  

Whole Space (May be condo/townhouse or single-family home) May have a community pool with other shared amenities or may be all private amenities.  Most popular are homes with private pools and these are the hardest to find.  Units typically accommodate between 1-14+ persons (some up to 100) IF you’re looking to buy, this is the type of accommodation you will want.  Focus your time on WHOLE HOUSE options.

Management Options There are two types of management styles we will discuss here.  OPEN and CLOSED.  OPEN means that the home owner can choose who manages the unit (A management company of their choosing, themselves if they live in the county).  The selection of management companies may be limited to 3-4 different approved firms.  CLOSED means that the home owner is required to use a single designated property manager.  Other restrictions may apply.

How to Save $$$ when booking a vacation rental

Vacation rental booking sites such as Airbnb, Booking . com or VRBO (also known as ‘Channels’ ) are all great sites to help travelers ‘connect’ with individuals or businesses (like Escape Properties or “hosts”) who offer amazing properties outside the box of a hotel.  We offer private homes with full-sized kitchens, private pools or other amenities that a hotel can’t offer and for way less than a hotel per room!  (Value -this is why people like you and I shop on these sites when we go on vacation!)

What if you new a secret that could save you 3-15% the next time you booked – would you want to know about it?

Channel companies like AirBnb and VRBO charge both you (the buyer) and I (the seller) each a fee to interact and transact.  This fee can range from 3-15% or more.  So who really pays for this added cost?  In every case, you the buyer, pay your portion PLUS in most cases, you pay the owner portion too through an inflated nightly rate.  

So . . . even though these channel sites are very convenient and they do ad value and help bridge transactions between the parties . . . but . . . IF you could save between 3-15% would you try this one thing?

Here’s the best way to save – book direct.  It’s that easy.   As a seller of vacation homes our best rates are on and through our own sites.  It is when we market through a channel we have to mark up our rate to cover the real hard cost of using a third party to help transact.  Simple economics.

What if there was an additional way you could save . . . would you want to know about that too?  

Many hosting companies like Escape Properties offer our returning guests a discount or incentive to re-book.  We do this because it is less expensive for us to service a prior guest than it is for us to go out and find new ones.  As such, because of the value of this relationship, we are happy to discount a little off the rate for you.  

Escape Properties offers two types of discounts.  One for just returning to ‘any’ property we manage within the next year.  This discount ranges from 3-7%.  The other discount is slightly larger and is unique to the last property you just stayed at.  IF you re-book a stay to the same unit you just stayed in you get a bigger discount. These discounts range from 7-10% depending on the property.

IF you only plan on visiting an area once every 3-5 years, using global sites like Airbnb or VRBO are perfect to use and make travel fun, easy and exciting.  But if you visit an area like St George 2-3 times a year, developing a relationship with the local guy, also saves money and makes travel even more fun, easy and exciting.

Safe travels and return often.

BONUS:  What if I don’t have a code, or I am not a returning customer yet?  Here’s 5% on us

Visit us by CLICKING here and use coupon code NEXT5.

Pricing | Setting rates for revenue

. . .What’s the best rate for . . .

Pricing is a never ending chore because there are just too many ‘what if’s’ and ‘what’s going on’s’ with a mix of ‘who’s’ just for good measure to keep on top of it! 

Price Guessing VS. Smart Pricing

I don’t pretend to know all things about AirBnb’s price tool.  I can only speak of it as to my own experiences.  What I found is the concept is great in  theory – but reality – it too is a hit-or-miss option.  IF you’re the first property to market, the tool sets your rate lower to attract travelers – some times too low.  As people book, available units nightly rates go up as inventory goes down.  So – how do you make it work?  Do you block major dates and open up later and hope you guess the timing just right to get the big dollar for a key weekend?  Do you force a rate and hope its not too high and your unit sits empty until demand picks up?  Do you drop the rate in hope to get occupancy but oops – you gave it away for a major holiday!  Sounds like a lot of work, guessing and time figuring it out to me.

Escape Properties deploys a technology that looks at current, future and historical trends and 28 total points of moving data in real time to set rates based on quality of your photos, sleep capacity, what INQUIRIES are doing vs. BOOKINGS and many other points to try to get “fair” market driven rates – good for both the traveler and the owner.

Focus on winning and not the one amazing booking!

Even if you’re not that in to sports, you will understand my point(s).  IF you’re a coach of a baseball team you will focus 75-80% of your efforts on single and double base plays, to load the bases, so when you get the one big home run you sore the most runs batted in (RBI’s).  If you’re a basket ball coach you drill your players to have a high percentage, like 90%, of shots taken within 8 feet of the basket (post position or lay ups) not all in trying to drain the 3-pointer from beyond the arc.


The same is true in Vacation Rental pricing.  You want to have ‘Fair’ pricing 90% of the time to get the most bookings (occupancy) and 10% of your bookings will be for ‘Top Dollar’ home runs.  If you’re always focused on the TOP DOLLAR rate, your occupancy rate will drop and your net revenues will tank.  Staying focused on occupancy will grow your revenue.  At the end of the year you’ll see a nice over-all balanced successful VR business.  This is a marathon, not a sprint.