posted by orlandovacationhome on Nov 10

Eyebrows were raised earlier this week when HomeAway, an Austin, Texas based vacation tech company, was able to raise $250 million through venture capital sources for what CEO Brian Sharples termed opportunities for the company to pay down debt, insiders to cash in a little equity, and for the vacation home rental company to perhaps pursue additional vacation home acquisitions. This comes on top of a $209 funding several months ago.

HomeAway owns the homeaway.com, vrbo.com, vacationrentals.com, a1vacations.com, cyberrentals.com and ownersdirect.co.uk websites. They are the proverbial 900 pound gorilla in the vacation home rental and vacation home management niche of hospitality lodging. They maintain some of the best vacation villa rental inventory in the Orlando area within several luxurious vacation home communities with a plethora of pools and other amenities. Inside sources indicate that roughly 30% of its revenues come from overseas which makes its domains a prime fit for Orlando tourism and travel. These brands certainly have a strong presence in the Orlando, Disney area and Kissimmee vacation home rental markets.

The ability for the firm to acquire capital in such a rough market does indicate that the clout and respect for the vacation home management and that the vacation home rental business model is growing. Strong consistent growth and a relatively stable cash flow model has now shown to be a valuation premium in this difficult market. My guess is that the funding will in time be used to:

1. Help HomeAway and its online brands to strengthen their market positioning in Orlando and other vacation home rental markets in the Central Florida area and elsewhere

2. Make additional prudent acquisions as the dust settles during this recessionary period. This additional funding might allow the company to expand its Orlando footprint in more “drive to” vs. “fly to” destinations that may come back quicker as a result of lower gas pricing for consumers.

3. Grow its presence in the vacation home managment area where cash flows tend to be stable and where its brand presence will give the company clear competitive advantage and leverage with homeowners

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posted by orlandovacationhome on Oct 31

We think good Vacation Home Management includes, but is not limited to:

1. All rental mark ups are fully disclosed to owners
2. All repair costs are fully disclosed in detail
3. Accounts can be accessed on line at anytime to see all bookings, fees and revenues
4. Any conflicts of interest are always fully disclosed by the managing entity
5. The cost of property maintenance is clearly broken down
6. The ability to opt out of the management agreement at any time
7. Quality assurance scores and complete inspection photos are disclosed monthly
8. Quarterly contacts to go over the scores by the manager
9. Realistic estimates formulated on the level and type of rental income the home can generate
10. Enabling owners to escrow for capital (major repairs) in an account the owner controls

Please see our other blog posts for additional tips and suggestions for choosing a vacation home management company.

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posted by orlandovacationhome on Oct 25

With a fragmented industry with lots of players and no strong “branded” presence, the consumer for vacation homes is left to make some decisions with little or no information regarding the maintenance and cleanliness of the home they will eventually be staying in. Quality assurance in the mind of the consumer will be the ultmate differentiator after staying in the home or referrring

Orlando Vacation Home Management Quality Assurance

How Clean is your Vacation Home

others to frequent that management company again. Along those lines, and before booking any vacation home, one should make sure that the management company has a program in place to proactively manage maintenance and cleanliness of each vacation home.

A quality program for housekeeping may include training methods, graded inspections and employee recognition to deliver a home that is clean and well maintained for each inbound guest. All three elements and others are part of an overall strategy to compete with the cleanest hotels, and to deliver a pleasurable experience.

From a maintenance perspective, regular and thorough inspections of the entire home are an important part of the process. Too many companies use the guests as their de facto QA team, which should not be the case, and is

All Vacation Homes Should be Quality Inspected

certainly not what you paid for. Performing needed maintenance and preventive maintenance at appropriate intervals before the guest arrives keep the home and its collective infrastructure operating effectively to the benefit of the occupants.

Before you book your vacation home, make sure the management company has a quality program in place as evidenced by testimonials, referrals or a program mentioned on their website. Although this might seem a given as a consumer, it is surprising to see the number of companies that don’t see the guest experience as part of their “brand”. Why? They put their time and efforts into other areas of the business or they purposely cut corners to reduce expenses. Make sure you never book with a company in the latter group.

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posted by orlandovacationhome on Oct 2

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posted by orlandovacationhome on Oct 1

Payback Estimates for Various Actions

A lot of media attention has been paid to environmental initiatives geared towards reducing resource consumption. As a homeowner and investor looking to make prudent financial decisions for payback periods of three years or less, let’s look at various greening improvements relative to their estimated payback periods for an Orlando vacation rental home:

• Conversion of incandescent lighting to compact fluorescent bulbs yields an average annual operating cost savings of $5.10 per bulb based on national averages.[1] Compare this to the cost of an 8,000 hour cfl 13 watt mini twister bulb for roughly $4.00. Based on these metrics, the payback period for cfl bulb conversion should be 1 year or less. The actual types of bulbs you install, seasonal home occupancy patterns and other factors will impact this figure.
• Front loading washers require less energy and water than the standard top loaders. National averages indicate tat this change may yield an average annual operating cost savings of $129.[2] Compare this savings to an average new large capacity washer appliance cost of $410 with installation. This yields roughly a 3 to 4 year payback period depending upon actual occupancy and usage factors.
•  If you have a dishwasher older than seven years, the newer high efficiency models can save on both energy and water. National averages indicate that this type of a change could yield an annual savings of $51.[3]Compare this to the cost of a new high efficiency dishwasher that will run in excess of $300 depending upon the model you select. This yields a payback period in the neighborhood of 6 years.
• Newer high efficiency refrigerators with bottom freezers also provide significant savings. A check of national operating cost averages indicate that making a switch from an older model (15 years or more) yields an annual operating cost savings of $72.[4] Compare this to a new refrigerator price tag of $650 yields a near 9 year payback period
• New heat pump storage water heaters provide a potential savings of $310 if you are converting from a 10 year old or more model with an equivalent .9 energy factor.[5] Compare this to a medium sized water heater sized for most homes for a cost of $1,300. This yields a payback period of roughly 4 years.
• Showerheads – Green Seal, a non-profit greening organization, considers 2.2 gallons per minute (gpm) to be green. However, many newer showerheads operate efficiently at 1.6 gpm. If your showerhead is around 3-5 years old, it is probably in the neighborhood of 2.5 gpm. A gpm flow rate is normally printed on the showerhead itself. Industry experts armed with standard usage and cost metrics for water and energy indicate that a drop from 2.5 gpm to 1.75 gpm will yield a payback of roughly one year. This would be for a $30 showerhead retrofit. Savings will vary based upon local water and energy costs, but this is a good rule of thumb.

Although these examples are rough estimates for your Orlando vacation home, these give you a fair idea of what home product replacements may be feasible based on a required three year payback period. As you can see from these estimates, the compact fluorescent lighting and showerhead conversion meets these investment payback thresholds. However, there are many recommended low cost or no cost common sense actions that can be performed to your home to leverage cost efficiency. These will be covered in future articles.

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