Getting the best price on Orlando Vacation Rentals in 2021 and beyond

Getting the best price on Orlando Vacation Rentals in 2021 and beyond

I received an inquiry from a Snowbird today, which is always an interesting exercise, as many love to stay in the Orlando area over the winter months, but of course, given the length of their stay, want to pay the lowest possible rate they can. This is completely at odds with staying in the most highly visited tourist destination in the world. If one is concerned about budget, it makes common economic sense to look elsewhere than Orlando, FL.

One will always find the best rates in places where most people don’t want to go.

So why Orlando, FL?

Of course, lots of Snowbirds love the Orlando area because of its many attractions. For many, it is a place they know, because they visited it many years ago with their young family to visit Walt Disney World. Now, as retirees, they may not much want to visit theme parks themselves (of course many still do), but they have family who will visit while they’re in residence. The family are usually their adult children with their own children (the Snowbird’s grandchildren) in tow, who DO want to visit theme parks as they stay with Grandma & Grandpa in Florida for a week during winter break. So Orlando is the location they want.

For many Snowbirds, the problem of reconciling a lower budget with a higher demand location has been resolved by the sheer volume of Orlando area Vacation Rentals available. The resulting choices made by inexperienced owners desperate to rent their properties out made easy pickings for Snowbirds. As a result of years of experience, many savvy Snowbirds understand that they are able to get properties for far less than they are worth, and what they should be paying. They are happy to take advantage of the ignorance of others if they can. It’s not their responsibility to save silly vacation rental property owners from themselves.

Were rental rates unsustainable?

For years lots of properties have been available to rent in the Orlando area for far less than they should be. There are many reasons why.

It is surprising how many owners don’t understand their costs, or are content to subsidize other people’s vacations. They think ‘it’s the best they can do’, or ‘something is better than nothing’. It really isn’t. A loss is still a loss, which ultimately makes no sense to incur.

Over the years, a property will degrade, especially a vacation rental, and especially one in Florida. It is much more expensive than owning a regular home. Without charging enough money to maintain and renew the property, it quickly becomes impossible to compete with new homes being built and also offered in the market for rent for far less than they are worth. New homes take over the market, and older ones exit. But they all follow the same financial trajectory, as all of the same factors affect all vacation rentals in the area, no matter their age.

Only the strong survived the pandemic

What the pandemic did for many of these area owners however, is expose their weaknesses. Without any money to help defray their costs, thousands have been forced to sell. The only ones who could hang on were those who had previously charged enough to be in a position to weather the financial storm of the pandemic. That’s not to say that they didn’t suffer losses… everyone did. But at least by charging sustainable rates, they would have a path out of the pandemic, whereas others simply could not see any future viability. Low rate operators would never be able to bring in enough to cover the losses of 2020.

You can’t cover off a loss by accumulating additional losses. Don’t get me wrong… no vacation rental owner in the Orlando area will ever make up for 2020. This is simply a matter of what 2020 took away from owners, and if there is any financial value in keeping on.

That’s not what the guy I’ve been renting from said

With a decade of consulting and advising other Orlando area property owners on management, marketing and operations of their properties, I’ve learned a few things. For example, I know that it is a fundamental truth that individuals will defend their right to lose money, and delude themselves about how they’re doing, and never admit to fundamental financial mistakes. It is embarrassing for most in our society to make such an admission.

The average person doesn’t understand how to keep, let alone generate wealth… only spend it. Owning a Florida property is within the reach of many; not losing money on one, especially in the Orlando area, is only available to a select few. These are the owners with the knowledge (or ability to learn it) to create a property and accommodations experience that people want and will thus pay a sustainable price for.

The number of Orlando area properties available on VRBO is now less than half what it was before the pandemic. With significant migration to the area, vacation rentals that come up for sale are snapped up by people buying for residential purposes. Our own neighbourhood, with just over 200 properties, now only has about ten vacation rentals left. It is amazing given that the community started out completely as vacation rental homes. A vacation rental offered for sale is under contract within five days, usually over asking. The new owners will be moving in… another vacation rental leaves the market.

So where are rates going?

Coupled with demand pent up over the pandemic, those owners who were able to hang on will see much higher rates over the next year and beyond. These higher rates will be driven by guests… those who understand what a terrific deal Orlando vacation rental properties represent (just consider what the same properties would cost anywhere else, in Florida, and beyond) and are simply willing to spend more to ensure they get what they want.

For every week that we booked through March and April of 2021, we had no less than ten to twenty requests for those dates from others this year. It was, pandemic or not, simply the busiest time ever in the history of Orlando Vacation Rentals, even with Disney Theme Parks operating at limited capacity. Personally, we set a record for the most bookings taken in a single week… after ten years in business. It will only get busier, as increasing demand descends upon a much smaller supply.

Act fast

Those who book early will find themselves in a secure situation, with the dates they want at a locked-in price. Others who wait will find rates only climbing as the dates get closer. The remaining vacation rental owners are a shrewder bunch, and they won’t be panicking to fill dates at the last minute. The scheer volume of increasing requests will assure them that they can get a much higher rate, and they will.

Guests who think they can take advantage of last minute deals will be left out in the cold. Amongst the last minute bookers are many who are not nearly so price sensitive, and don’t see it as a strategy for finding a great place to stay. They would much rather pay whatever amount necessary to get what they want.

The way to get the best possible rate will be to commit and book as soon as possible, locking in the lowest possible price. The reverse approach has already proven in early 2021 to be a losing strategy.

Author description

BOV Host

About the author:Rob Peters is the Site Administrator, Blogger and Chief-Touble-Maker on BreezyOakVillas.com When not online, he is managing his terrific vacation rental properties in Florida, or admiring his three adult kids and loving his wife Donna.