Who doesn’t want their own island oasis for both visiting and generating income? Purchasing a vacation rental on Maui is one of the most popular investment opportunities on the island. Despite changing regulations, the vacation rental industry continues to post impressive numbers on Maui, and the margins on return boast a conservative capitalization rate of 1-3% depending on a number of factors.
Maui is a prime location to own a rental for countless reasons, but one thing that works in your favor is the ability to adjust prices based on time of year. You can also block off dates that you, family, and friends want some time in paradise. It’s the best of both worlds!
Owning a vacation rental can be challenging yet rewarding. It requires attention to detail, constant upkeep, and a few other things you may not yet be aware of, but I’m here to help you understand the ins and outs of owning a vacation rental on Maui.
I Get By with a Little Help from My… Property Management Company
The first item on your checklist should be determining whether you will personally manage your rental or utilize a property management company. If you’re not living on island, it’s required that you have an on-island contact for emergencies. If this is your case, a management company will likely be your best bet for fulfilling this requirement and providing additional services that are essential to the success of your rental property.
Property management companies attend to guests’ needs, manage the booking calendar, coordinate housekeeping, and generally keep your vacation rental operating smoothly. There are dozens of reputable vacation rental property management companies on Maui that I’d be happy to refer you to. Most companies take 20-30% of gross revenue as a fee for managing the unit, but working in partnership gives you the benefit of shouldering fewer direct responsibilities.
Taking the Self-Management Route
If you live on Maui and plan to manage your property yourself, there are various hats you will have to wear, from scheduling to maintenance to advertising. But don’t let this deter you from captaining the ship of your investment property on Maui—it’s totally doable as long as you’re prepared!
First, it’s important that you familiarize yourself with local laws, rules, and taxes that accompany owning a vacation rental. It’s highly recommended that you get a Maui accountant so that nothing falls through the cracks and your property remains up-to-date on changing rules and regulations. You’ll also need to come up with a rental agreement and policies for guests to ensure your protection and theirs.
Next, you need to arrange a cleaner for your property, whether it’s a company or a contracted individual. This will ensure your rental is always at its best when a new guest arrives. Want to go above and beyond? As a property manager myself, I recommend you stop by the property after each cleaning before your next guest is scheduled to arrive. While it isn’t a must, you can make sure things are exactly the way they should be which should boost your number of five star ratings!
Before venturing into self-management, you should compile a list of contacts/vendors who will come in handy for different circumstances. Identifying a handyman, plumber, and back-up emergency contact who lives on island is a great place to start.
Tips for All Vacation Rental Owners
Something to keep in mind is the possibility of maintenance and appliance replacement costs. The success of your property will depend on up-to-date furniture, working appliances, and items that look new and clean. Vacation rentals need new toasters, screen door replacements, and refreshed shower curtains more often than you might think. Keep your guests happy by consistently checking for worn out, broken, or outdated items.
Once you decide your place is ready to host guests on their dream vacation, you’ll need to post your property on sites like Airbnb or VRBO. I highly recommend using multiple platforms (including direct bookings) to give your rental optimal exposure. To truly showcase your property, you should hire a professional photographer to take pictures that beautifully and accurately display your rental. It’s crucial that your listing represents the property accurately; if it doesn’t, guests will likely complain and you can get in big trouble with booking sites. Another pro tip: Make sure your rental is 100% ready for guests when you post it online. Owners often receive a booking within a couple of hours because these sites prioritize new listings!
Go the Extra Mile
To provide guests with a five-star experience they won’t forget, here are a few tips that will put you a step above the rest.
First, putting together a Maui welcome basket with local island goods will make guests feel an authentic sense of welcome. This doesn’t have to be overly costly. Grab some small gift items from the ABC store and include food items in favorite Maui flavors—lilikoi, li hing mui, and local coffee are always a hit.
To keep your property in high demand, it’s also important to constantly be improving. There are Youtube channels, Instagram accounts, and online articles galore to keep your rental brain sharp and help you stay up-to-date on the latest trends. To this end, it’s a great idea to join an online community that allows you to learn from the experience of other vacation rental owners. Search keywords like “VRBO Owners” or “Airbnb Owners” on Facebook Groups to take advantage of group-think sessions on customer service, creative amenities, and more.
Find Your Dream Property Today
If you’re ready to find a place to call home when visiting Maui while also earning income that helps offset the financial costs, I’m here to help! Contact me today to begin your vacation rental ownership journey.