Vacation Rental Glossary
Nightly Price or Daily Rate
Price per night advertised to the consumer by the vacation rental manager or the channel. It essentially is the price that your potential customers pay to stay in your vacation rental. This is always rent-only or could also include external fees depending on the channel.
Sometimes also called resort fee. Extra amount that guests pay on top of the nightly price to access certain amenities of the vacation rental like swimming pools, tennis courts, barbeque nights, etc.
Fees that agencies, channels or websites charge guests for booking through them. It is basically the administrative fee that channels, agencies, or websites charge on top of your daily rate.
Fees that guests have to pay if they cancel after the cancellation deadline has expired. These can be a flat amount withheld from the refund. They can also be a full forfeiture of the deposit paid. Deposits are often a percentage of the total cost, for example, 30% or 50%. These are usually non-refundable. In the US, it is always included in the rental agreement or contract.
Fees that agencies, channels, or websites charge owners or vacation rental managers for booking through them. In the case of Airbnb, it is charged to the guests as a service fee in addition to a percent commission to the owner or property manager.
A one-time charge by hosts to guests for cleaning the vacation rentals. The cleaning happens in the window between guests’ check-out and other guests’ check-in. This can be effective for guests’ who have booked longer stays. Read More
Also known as a security deposit, this is a refundable amount which a vacation rentals owner collects from their guests. This is a guarantee that guests will return the vacation rentals in the same condition. If there are any damages to the property, the host can make deductions from the damage deposit.
Vacation Rental Management Cost
Also, short-term management costs. Total expenses in managing a vacation rental property. The expenses that you may come across are: cleaning fee, maintenance costs, broadband costs, etc.
Gross Booking Revenue
The total revenue that a vacation rental earns from bookings including taxes and fees.
Average Daily Rate
It is the total rent divided by the number of nights within a given time period. An indicator of the average price of a vacation rental, it is calculated by dividing the total revenue generated in a vacation rental by the number of nights the vacation rental was booked. It is essentially the booked rate, and does not include the prices for open nights. Read More
RevPAR can effectively predict your ADR’s success at filling available rooms. This, therefore, provides a constructive view on your property’s operational performance. It is the balance between the occupancy rate and ADR that is, it is the occupancy rate multiplied by the average daily rate. Read More
Net Operating Income (NOI)
It is used to analyze the profitability of a vacation rental calculated by subtracting all necessary operating expenses from the sum of the revenue from the property.
Return on Revenue (ROR)
It is used to measure the profitability of the vacation rentals by comparing the net income generated for each revenue.
Return on Investment (ROI)
It is used to evaluate the efficiency of an investment by dividing the profit from the vacation rentals by the cost of the property.
It is the percentage of reservations that have been canceled during a specified period of time.