The Vacation Rental Revolution: Real Estate in the Times of Shared Economy

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By Anabelle Rossell

Many years ago I asked my former boss, “Why does La Paz not have more flights coming into town?” I remember he replied, “It´s because the airlines say La Paz does not have enough hotels where to accommodate travelers. Therefore investors do not want to build more hotels because there aren’t enough flights to La Paz.” Turns out here in La Paz, we were living a modern case of which came first, the chicken or the egg?

Enter the sharing economy revolution in the late 2000s: Private homes all over the world became homes to others. Suddenly if you owned a house/apartment/couch you could have an extra income providing hospitality at your on pace, under your own rules with leading pioneers in the industry like Airbnb.

Fast Forward to 2018: Airbnb has a record 6,000 accommodations in BCS with 700 active rentals in La Paz (just in the city according to Google Maps). That´s our local rental inventory with an average of 4.5 out of 5 stars quality service, a 49% occupancy rate during high season and a 78% growth rate since the first rental home was listed in 2010. Not bad for La Paz, uh?

So what happens now that it seems pretty much everybody has an Airbnb for rent? Should you buy to rent? Is it profitable to invest in a rental property? If so, where and how much? Should you hire someone to manage your properties considering all the technology at hand?

Enter the rental property manager/realtor/daily miracle multitasker. I´m serious – not joking at all. Realtors that perform property management on a daily basis in La Paz are badass. A different kind of breed, the Chuck Norris of Real Estate!

Go ahead and talk to one and ask innocently, “Hey, what’s the toughest situation you have dealt with?” You will get an instant deep snort and eye roll and they will try to pick just one.

I have been in the real estate industry since 2005 and I have learned that when investing in Mexico, you should talk to a lawyer, a notary, an accountant AND I can tell you for a fact you should talk to a property manager – realtor. Why?

1. We are neighborhood specialists: We know the good, the bad, the funny, the ugly and the Lord have Mercy of most of the communities in town (again not joking). We know the community managers, rules and the CCR’s. We know the neighborhood/neighbors, the cost of utilities, the quality of construction and developers guarantees. We also have a strong network of contacts to assist owners, guests, buyers and sellers to assist with every personal inquiry.

2. We know the rates and profits: Most AMPI La Paz agents use the MLS for local real estate knowledge and attend local open houses and property tours. We work with several rental platforms for market analysis and rental trends and even software to analyze vacation rental revenue per property. Since most of the city has an average rental rate income we know the rates, expenses and profits in it according to season. You will not become rich renting homes in La Paz but it will definitely help with your fixed expenses and may give you some additional income to enjoy.

3. Clients and guest screening: Since we get to know a lot of people on a daily basis, we get pretty good at screening clients and avoiding those problem people. The time we invest in checking references is the time we will save in the end. I have had my fair share of being screamed at when we´ve refused to rent as we are committed to represent our property owner’s best interest. The owner has his/her own house rules and he/she has the final word.

4. Quality Home Maintenance and Inspections: We like to make sure everything is working in each one of our homes and we have the right contacts that will not keep us waiting for mañana. Maintenance is probably the hardest part of this job. A professional home maintenance checklist has 68 tasks plus an inventory list to be reviewed before delivering a home to their new guests. A strong quality construction dutifully inspected means less time/less money invested in your property = more income for you.

5. Customer Service: Shared Economy is based upon collaboration aka experiences. Therefore, we listen carefully to what you need to provide buying/rental solutions. The more unique and respectful experience (this works both ways) you can offer when it comes about vacation rentals, the more bookings/guests/reviews you can have when competing against 699 properties on the same platform.

6. Technology: Technology has a good and an evil side. It will definitely help you accomplish more but it will require a lot of time to answer your booking inquiries with immediate responses.

Sounds like a lot of work and info to digest? Yes. A lot of time and energy to invest? Yes, we know. That’s why when buying or selling a home or entering the rental market, hire a property manager. They provide true local experience and knowledge on a daily basis that has become, now more than ever, so important.

A realtor since 2005 and rental & property manager since 2016, Anabelle is a runner, amateur baker, mother of 2 dogs who along with her sister and partner Stephanie own/operate a kick ass local team managing 50+ properties in La Paz and La Ventana with over 350 reviews on Airbnb and other platforms.