In the vacation rental market, V.R.B.O. is the abbreviation for the term Vacation Rentals by Owner. In today’s era, travel agencies no longer the only source of booking a quality vacation. Most vacation condominiums are privately owned, meaning that each door in a Beach Resort is owned by a separate individual person or entity. Before the internet came along, property owners relied on travel agencies or real estate companies to fill these rental properties with vacationers. Property owners and travelers, alike, were in need of a direct medium for doing business. The internet now makes it possible for property owners to be contacted directly by the perspective property user, thus eliminating the “middle man,” and resulting in a win-win for both parties. This method of reserving vacation or business accommodations does not come without risk, however; but if one is willing to take the chance, it could pay off in big savings.
Two decades ago, if you wanted to reserve a nice 2 bedroom vacation condominium on the beach, it would have been necessary to get out the yellow pages and call a travel agent, who would in turn contact or put you in touch with a real estate firm who managed that exact type of property. The package was booked and paid for through the travel agent, who would get a predetermined percentage of the package cost. The resort management firm, who is almost always a real estate company, would also get a large percentage of the proceeds. This partnership allowed these companies to maintain control of the vacation rental market for years, and precisely how large management companies that you find today were able to grow into the mega-corporations that they are.
When the internet became more readily available, websites began to pop up that allowed a property owner to advertise their property for weekly rentals. These sites are very popular with regular vacationers and are growing ever larger by the year. Most of the property owners who use these listing sites have opted to discontinue contracts with property managers in an effort to save the management fees. This is a very important factor to consider when reserving a property from a V.R.B.O. site. By the time you arrive, all negotiations are off; and if the property isn’t what you expected it to be, there will not be a front desk or management number to call for amends. Your only source of contact will likely be the property owner, who may live hundreds or thousands of miles away from the actual condominium that you reserved. This is the gamble that must be considered when reserving a non-managed property from a V.R.B.O. site.
Trust is key between both parties. The owner is trusting that his property will be cared for properly, and the renter is trusting that there will be actually be a nice property there upon arrival. Assuming that the property is exactly what is described in the ad, and that all amenities and utilities function as they should, this arrangement could be a great deal for both parties. Cutting out the “middle man” will usually result in lower rental rates, while yielding a higher profit for the property owner.