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Airbnb Management VS. Co-Hosting: What’s the difference?

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SUMMARY:

What is the difference between a co-host and a property manager? This is one of the most common questions I am asked by people looking to get into the Airbnb management industry.  Understanding the answer and the layout of the industry can help you decide where you want to position yourself and where the greatest opportunities lie. 

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This video will go through the differences between a co-host and a property manager.  It will give a layout of the industry and talk about where the biggest opportunities can be found. 

When we are talking about what the actual responsibilities are, there is no difference between the two terms. A lot of times, they can be used interchangeably.  Where they are different is how they are perceived. 

A co-host is typically a smaller operation.  This could be someone who hosts their own property and helps out their friends and family.  A larger operation, for example Evolve or Vacasa, is more likely to call themselves a property management company, or a vacation rental management company. 

So while the terms can be used interchangeably, what they communicate and how they are perceived is different. 

The next step is to understand the overall layout of the industry.  If you are a property owner, this will help you understand who you want to manage your property.  If you want to start a property management company, this will help you understand how you want to position yourself and where the biggest opportunities are in the market. 

As mentioned, a co-host is usually an individual who is going to be managing a lot of tasks on their own, such as guest communications, organizing cleaners and handling check-in and checkouts. These individuals will probably strictly stay on Airbnb and not use any other platform.  They will usually lack a lot of systems and instead of treating it like a business, it will be more like a second job. 

There is nothing wrong with hiring someone that has that perspective, but you do need to understand their limitations.  If you have started out your business this way, you are going to be limited by how much you earn because of how dependent it is on your time.  If you walk away from the business, it will stop making money. 

As you grow, it will hurt your business to not have those systems in place as you will be the one doing a lot of that manual legwork.  That is one end of the spectrum. 

The other end of the spectrum are companies like Evolve and Vacasa that manage hundreds of listings around the world.  They have those systems, protocols and processes in place. If you have many listings, having one company manage them is a huge advantage.  Smaller companies will not be able to do that. 

However, they have their shortcomings. There is barely any one-on-one support for your listing.  If you have fewer properties, then a mid-range company can give you that individualized attention. 

There are also limitations to how listings perform.  To scale that large, listings need to fit into a certain mould.  Outside of that, a larger company does not have the ability to optimize your listing’s performance and it will perform poorly.  Without having an area of expertise, a large company provides adequate value, but not exceptional value, to everyone.  

A mid-range company is the best of both worlds.  You have processes and things are streamlined.  The business can operate without your constant input.  However, by limiting your focus on one type of property owner or property, you provide that attention the listing needs to reach its earning potential.  There is a huge opportunity in those niches to provide more value.  

In order to build that effectively, you need to: 

  • Dial in your niche
  • Have a great solution to problems your niche faces
  • Put systems in place 

There are limitations when you do not have systems in place and are doing everything yourself.  It means that:

  1. There is no freedom – your earning is completely tied to the time that you work.
  2. The quality of service is limited.  If you are not available, then service is unreliable. 

This does not need to be complicated.  To be able to streamline the daily operations is learning the right systems and automations to manage many basic tasks. 

If you want to look at what I have put in place in my business, and take an in-depth look at my processes, check out the training in the link above. 

VIDEO TRANSCRIPT:

Hey guys, it's James again with another video and I want to talk to you today about one of the most common questions that I get asked by people who are just getting into property management just getting into the world of Airbnb.

Probably the most common question I get asked by this group people is, what's the difference between co hosting and property management? And along with that question, people tend to wonder, you know, do you manage properties outside of just Airbnb? Do I want to start co hosting? Or do I want to be a property management company? What's the difference? And just kind of understanding the whole lay of the industry so to speak.

And so I wanted to try to make a video that just kind of answer some of the most common questions there around the actual layout of the industry and the difference between co hosting and property management. So in this video we're going to talk about is number one, you know, what is the actual difference like in those two terms, co host property manager, what do they actually mean?

Are they different, what is the difference, if anything, all that, I also want to talk about, you know, what is the actual industry layout like what it Companies look like what's the difference between a co host and a full scale property management company? And where is the biggest opportunity there? Where do most people want to try whether you're a property owner or whether you're someone who wants to actually get started managing other people's properties on Airbnb.

Now, before I get started, I would love to just ask you a quick favor if you could just drop a like on the video just hit that like button the little thumbs up button. It does help me out a lot with YouTube's algorithm so if you could take a quick second and just give a quick link to the video I would really really appreciate that it would help me out a lot and if you if you appreciate what you hear if you learn something in the video here, leave me a comment down below let me know if you have any questions about anything else related to Airbnb, just let me know in the comment section below.

Without any further ado, let's go ahead and drop into it. So to start out with I want to preface by saying that really at the end of the day, there is no difference between co hosting and property management in terms of the reason that I say that is that typically There, there is a slight difference in terms of what a person does if they call themselves a co host versus a property manager.

However, a lot of the times those two words can be used very interchangeably. At the end of the day, there really is no difference. However, most people that run a very small operation will be more likely to call themselves a co host.

And then those who are running a bigger operation, like for example, evolve, who you may have heard of, you know, vacasa, some of these companies that manage several hundred or several thousand listings, they're going to be the less likely in most cases to refer to themselves as co hosts, and more likely to refer to themselves as property management companies, short term rental management companies, vacation rental management companies, that sort of term is what they're typically going to going to lean towards.

The people that use the term co hosts are typically going to be people that are hosting their own property, and maybe helping out their friends doing the same doing the same. And so, yes, you can use the two terms interchangeable interchangeably. However, it's going to communicate something slightly different. At the end of the day, there's no difference in what they actually do. There's just a slight difference in how they're perceived, if that makes sense.

And so that's kind of where I want to, again lead into, I want to tie this back into what the overall layout of the industry looks like, because it's common for people to kind of understand it and kind of understand, okay, there's co host, there's property managers, but like, what is the real difference? And how does everything work? And what's, you know, if I'm a property manager, or a property owner, what kind of person do I want to have management company?

And if I want to start managing properties on Airbnb, like, I know, a lot of my audience does, you know, what, like, Where do I want to start? How do I want to position myself what's the biggest opportunity in the market.

And so, like I just described with the difference between the way that the two terms are used cohost versus property managers in the market and the industry overall, there's typically sort of two ends of the spectrum in terms of what you can expect what the the different companies are going to deliver on the one

Then you've got really small kind of mom and pop style companies, which are really most often just an individual who's going to be doing some co hosting just helping out a couple of their family, a couple of their friends, maybe their neighbors to do things like guest communication, managing check ins and checkouts organizing the cleaners, on their Airbnb listings, typically, those co hosts are only really going to be managing things on Airbnb, they're not going to stray outside of that on the other platforms like VR, Bo, homeboy booking.com, they're just going to take care of some of the basics.

And they're not really going to have a lot of systems built out, they're not going to have a proper business as much as they're just going to have sort of a second job that they're going to be helping people to host their properties. Now. There's nothing wrong with hiring one of those people to manage your property, but you do have to understand there will be certain limitations.

That person again, if you're also if you're starting a business managing properties, if you start out that way as just a co host, you're going to be very limited in how much you can earn And it's really going to come back to your time. Because like I said, You're not really running your own business, you just have your own sort of side job, a little side hustle, you're going to be earning dollars per hour.

At the end of the day. If you walk away from that business, it ceases to make you money. So you're not really running a business, you're just running your own job, which can be fine. Yeah, you have total control of it, you have flexibility over hours, there are a lot of benefits to it, you just want to realize it for what it is and call a spade a spade is my viewpoint on it.

And so as you grow, you're typically only going to get with that type of a system, that type of a setup, you're really only going to get to maybe three to four, maybe five properties under management before you start to get maxed out because bear in mind, without any real systems in place, you're probably going to be doing a decent amount of cleaning, you're probably going to be organizing all the cleaning if not doing it yourself.

You're also going to be doing a lot of the guests communication yourself. You're going to be managing check ins and checkouts you're going to imagine the pricing of listings, all lots of is a lot of manual legwork, and so on. That's the one end of the of the industry, the one end of the spectrum as far as property management for short term rentals go.

Now on the far other end of the spectrum, you've got these large companies like evolve a casa, these management companies that are managing hundreds, if not thousands of listings. So for example, evolve as managing several thousand listings around the world. And so the the reality of that is that those companies have scale, they have systems in place, they've got the right protocols, the right processes for every single piece of the of the equation.

And what you're going to realize if you're a property owner that's working with them is that they have all those things really, really dialed into very streamlined process, however, where they're really going to be falling short. And probably the number one complaint that I get from property owners who work with large companies like this is that you get next to know one on one support next to no individualized attention for your listing.

And so unfortunately, if your listing doesn't really fit into their cookie cutter mold for how to make it perform. A lot of the time the listing is going to perform quite poorly under management with a company like evolve the cost. No, I'm not slandering those companies. I'm not saying they don't do a good job managing properties and not saying they don't have a fit and a place in the marketplace. They certainly do.

I think that for a lot of property owners who have multiple listings, you know, 1020 properties that they want manage, having them all managed under one roof is a huge, huge advantage. So even if each individual listing isn't optimized to its fullest potential, there is still a nice advantage to having all your properties under one roof, and a smaller company likely wouldn't be able to actually facilitate that.

However, if you just have one or two or three or four or five listings, then you could give them to a smaller company, you know, sort of mid range size company that manages anywhere from 20 to 40. listings, and you're probably going to get a lot more individualized attention. And the reality of that is that just simply put, your property is likely going to perform better.

The reality is that evolves to is not going in and individually adjusting the prices on every single one of their listings. They have algorithms and systems, their setups do that automatically that work, all right, but they don't do a fantastic job.

And this is experience that I've had this experience that I've heard from property owners that work with them, and so not so I think there is a really, really great opportunity, especially for those small to medium sized businesses a little bit larger than a co host, someone who's got the right systems in place to make the process really streamlined, have it be a really enjoyable experience for the property owner, have everything kind of just flow really nicely.

And from a business owner perspective, have the business be able to operate without your input constantly going into the business on a day to day basis, but also be able to limit things to only focus on serving one single group of property owners so that you can give them the individualized attention their listing needs to really reach its maximum potential.

Because the challenge with a company like evolve a casa is that they're going to be focusing on trying to be sort of everything to everyone, they don't have one area of expertise that they really focus on, or one specific group of property owners that they really focus on delivering value to.

And so the reality is that they just don't offer an exceptional level of value to anyone, they offer an average amount of value to everyone, right? But where we can come in, and we have a huge operation, this is largely how I built my business and how my clients had built their businesses.

And where we found the most success is by going into those pockets of let's say, for example, mountain properties in Colorado, and focusing on exactly figuring out exactly what pain points those property owners have exactly what challenges those properties have exactly what the needs are, and then serving them and delivering solutions to those problems on a higher level than anywhere else.

Now, if you compare that to what evolve is doing, they're doing an average solution that's sort of cookie cutter and it's meant to fit all the different categories in the market. And so naturally, it does an okay job of doing that, but it doesn't do a fantastic job and so there's a huge opportunity in those different pockets of different niches, we call them to really go in there and make a big difference and provide more value for the property owners, and therefore just, you know, be able to have a more valuable service for them.

So there's a huge opportunity in that space in the market. Now, in order to do that, effectively, you need to have a couple of things, you need to really dial in your niche, you need to really have a great solution. And you also need to have the systems put in place to back up your business, you want to make sure that you're not the one that's giving everything into the business.

Because at the end of the day, number one for you as a business owner, it means that you don't have any freedom, it means that you are completely tied into the business and you're always going to be earning based on the amount of time that you put in on that day. But number two, it means that the quality of your service is going to be very limited. If you get sick, you're not able to be as reliable as a bigger company like the reality is just it's very obvious.

It's very simple. If you are the linchpin in your entire operation, then your service is not as reliable and therefore not as valuable or sought after by proper guards. If I'm a property owner who has a property out in the mountains, you know, three hours from where I live, the last thing I want is for guests need to check in. And I'm depending on one single person to take care of everything.

You know, the reality is you need to have systems built out you need to have different tools built out, you can have the right people on your team to depend on not saying start building out infrastructure like you're trying to reach the status of evolve or you know, trying to get to 300 500,000 listings under management. There's a few simple systems that you need to set up in order to be able to support messaging guests without your input.

You know, your guests getting their questions answered, your pricing getting updated properly, your cleaners being organized to get over there. Those sorts of basic necessities of the business's daily operations just need the right systems, the right tools automations teamwork in place to be able to fill on them without your daily input. Now if you want to learn those exact step by step strategies, you want to learn what those systems really look like if we pull up the hook.

And look inside, then I've got a link in the in the description below to a free train that put together where I do exactly that I sort of pull up the hood on my business and show you inside show you our systems, how we built everything, you know, what sort of tools what automations what software's you know, all the different systems, standard operating procedures, everything I show you literally everything about exactly how we built the business and how my clients are building their businesses, like I said, and Nisha is all over America all over different parts of Asia, Australia, Europe. Really, really cool.

So if you want to get just a whole bunch more depth to this and really understand exactly what those systems look like I'm talking about, then just go ahead and register for the free training link in the description below. Just get yourself registered there and then we can walk through everything together kind of step by step with you.

Again, if you got value from this, if you really liked the video, if it was you know, if it helped you to get more clarity on all this, then just drop it a quick thumbs up that again helps me out tremendously and if you have any comments, any thoughts, any subjects you want? hear about in the next upcoming videos anything like that just drop a note for me in the comment section below and I would love to hear from you Until next time. I will see you in the next video.

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