Making sure you do your research before choosing your rental manager can be the difference between (significant) profit and (substantial) loss. The following is an assessment of the top 10 property managers in Nerja, one of the most competitive areas on the Costa del Sol (ranked by total properties per sqm and by number of competing properties across portals).
“Just because a rental manager has a lot of properties does not mean they are good at what they do.” Jack Cheshire, Teamstar Managing Director
Using AirDNA, an analytics platform which provides the most comprehensive vacation rental data and analytics in the world, we have taken data published on October 27th 2020 to help examine the research for the holiday rental market in Nerja.
INDICATOR #1: TOTAL REVENUE
Using data from the last 12 months to ascertain which property manager has earned the highest revenue is interesting but also somewhat obsolete. All rental managers would of course like to be at the top of that list; however, it is not really that important. Though, if a rental manager is near or at the top of that list it does represent solid infrastructure. For a well perfoming team, the company must be able to support good quality employees, technology and sotfware. Rental managers with below average revenue will not be able to support their company through good times or bad. If your property manager has sub-par revenue, its likely going to have sub-par employees and as a result provide you, the owner, with a mediocre rental performance.
Figure 1: Top 10 property rental managers in Nerja ranked by total revenue for the last 12 months (Sept 19 – Sept 20)
Source: AirDNA data
INDICATOR #2: REVENUE PER PROPERTY
Here we have layered the total revenue earned by total number of properties across the top 10 rental managers in Nerja. Importantly, even though a property manager could be in the top 10 revenue earners out of a total of 40+ property managers in Nerja, they could well be earning less than 50% revenue per property versus other property managers. As an owner, you want to stay out of that category as much as possible.
Figure 2: Top 10 property rental managers average earnings per property (Sept 19 – Sept 20) – dotted line is top 10 average
Source: AirDNA data
INDICATOR #3: TOTAL PROPERTY REVENUE PER NUMBER OF BEDROOMS
While figure 2 is quite compelling, using only revenue per property as your single data point can be a little misleading without digging deeper into the numbers. Going one step further and splitting the dataset into revenue generated by number of bedrooms we can see an even clearer picture, see figure 3. Keeping the rental manager ranked as per figure 1 (ranked by total revenue), we can now see just how profitable each rental manager is across different property types. As a property owner, it is vital in today’s world to be guided by numbers and not running blind into some salesman’s honey trap. If you are looking for a rental manager to rent your three bedroom property, you ought to know if the rental manager you are speaking with has a track record of earning above average returns for other three bedroom properties.
“Use data to make smart, data-driven decisions” Geoff Cheshire, Teamstar Chairman
Figure 3: Top 10 property rental managers revenue per property type
Source: AirDNA data
INDICATOR #4: THE TEAM
Finally, and arguably the most important factor when picking your rental manager is, the team. At the end of the day, you have to be comfortable with the team and their approach to you, especially during the onboarding period of getting your property live. This precious and short exposure to the company is a critical time to make a personal assessment of the culture and teams’ demeanour. This is arguably the most important aspect of rental management.
Most often a property owner looking for a rental manager will go with a personal recommendation from a friend or associate, alternatively clicking the top two or three links in a Google search will often seal the deal. Frustratingly this old school and somewhat archaic approach still rules the day. We at Teamstar strive for transparency and objectivity, we want to shine a light on the market by providing owners and guests alike with the data the industry deserves. At the end of the day it really is down to the team and company culture when building a long-term relationship, but the aforementioned key indicators can really help property owners make informed data-driven decisions, and ensure they get the most out of renting their property.
If you have any questions, would like to understand these data points in more detail or hear more about Teamstar and how we can help rent your property in Nerja, please reach us on firstname.lastname@example.org.