How to Prevent Short-term Rental Incidents While Scaling Your Business
This blog was written by Autohost, a guest screening and automation platform for hospitality providers.
Growing your property count and expanding into other markets are major challenges in the short-term rental business. Many property managers never figure out a successful formula for making either happen. Scaling your business is even more difficult when you’re dealing with bad reservations that result in parties, property damage, theft, and other criminal activity. Instead of investing in growth, your revenue is tied up with costly incidents.
To successfully scale your business, you need to make security a priority. Here are five security tips that any property manager can (and should) implement:
Verify your guests
Guest screening is an essential component of any security process. It helps protect your properties, your business, and the overall community. When screening your guests, you need to verify who’s staying at your property and whether they pose a risk.
Before giving a guest access to your property, collect all necessary ID documents. Ensure that the ID is valid and belongs to the person who submitted it. You can do this by matching the information and photo on the ID to the booking details provided by the guest. Having the guest’s ID on file also allows you to check whether they meet your age requirements.
You can gain some additional information by searching the guest’s social media presence. Guests with multiple active social media accounts are more likely to be real people, rather than a fake identity. You should also verify the guest’s payment method by checking that the name provided in the booking details matches the name on the credit card used to pay.
Don’t just verify the guest who booked. Ask for a guest list with the personal information of anyone staying at the property. This ensures the number of guests doesn’t exceed your property’s capacity limit. With this information, you’ll have a better chance of catching guests who are trying to throw parties (check out Guesty’s party proof guide).
By avoiding these types of incidents, you cut the costs associated with cleaning up after them. That revenue can be redirected into growing your business.
Monitor booking details
In an attempt to protect their business from risky reservations, property managers are often limited by harsh booking restrictions, such as no one-night stays, no last-minute bookings, and no local guests.
But avoiding these bookings altogether leaves significant revenue on the table. Instead, try opening your doors to higher-risk bookings by carefully monitoring the details of each reservation. With proper guest screening, you can capitalize on all reservation types, without exposing your business to unnecessary risks.
When a booking comes in, take the time to comb through it, looking for any red flags. This could include guests who are booking a property bigger than their needs—such as a couple renting a four-bedroom house—guests who are underage, or guests who are trying to pay with a prepaid credit card. These are all signs that a guest might have malicious intentions at your property.
If you’re on the fence, jump on a call with the guest to ask about why they’re traveling. This will give you a better idea of their intentions for your property. Plus, if everything checks out, it allows you to better cater the stay to the guest’s needs. For instance, if you find out that a couple is traveling for their anniversary, consider leaving a bottle of champagne at the property. This creates a memorable guest experience, encouraging referrals and repeat customers.
Implement multiple security layers
No single security measure is foolproof. Guest screening is a must, but the more protection you have, the better. To ensure you’re covered during the stay, it’s worth looking into active security solutions.
Insurance is always a good place to start. Make sure you have a plan that covers your business, damage to your properties, and any host liabilities. Property monitoring tech is also a smart investment. This includes noise monitoring systems and cameras—just remember to keep cameras outside the property for the privacy of your guests. With these solutions, you can catch unwelcome visitors and potential parties before they escalate.
With a multi-layered security process, you will reduce the likelihood of incidents, saving you from avoidable and costly expenses. Plus, prioritizing security will help build stronger relationships with your neighbors and within your community. And showing stakeholders that you take security and the wellbeing of your guests seriously will attract other property owners, giving you opportunities to network and acquire units.
Offer a damage waiver
Many property managers rely heavily on security deposits, specifically the security deposit feature offered by online travel agencies (OTAs). But relying on this feature can occasionally backfire. Most OTA claims processes are slow and time-consuming, with the resolution often favoring the guest. This means you might never see money after an incident at your property. On the other hand, offering the guest a damage waiver gives you more control.
With a damage waiver, the guest pays a smaller amount to cover the cost of any incidents that might happen during the stay. The price ranges, but is often around $25 to $50. You also collect this money upfront, rather than putting a hold on the guest’s credit card and trying to claim the amount post-stay as you would with a security deposit. When a stay is incident-free, damage waivers also act as an additional stream of revenue.
Offer guests a damage waiver on a case-by-case basis. If you’re concerned about a specific reservation, require a security deposit. That way, you have the opportunity to collect a larger amount should you need to cover any cleaning or repair costs. For low-risk reservations, let your guest have the option of paying a damage waiver. A smaller cost might be more appealing than having a hold on their credit card or worrying about accidental damage.
Most importantly: Automate your security process
All of these suggestions are great ways to avoid incidents at your properties and earn more revenue. But as your business scales, eventually, you will get to a point where it’s no longer possible to manually manage your security processes. It’s time-consuming, resource-intensive, and vulnerable to human error.
Instead, consider automating your security process. Aside from reducing incidents, you’ll be able to streamline check-ins and process more reservations in less time. Plus, with security automated, you can redirect your team’s time and energy to revenue-generating activities, such as better customer service and acquiring more properties.
To learn more, check out Autohost’s free ebook Scaling Security: A Property Manager’s Guide to Automating Guest Screening