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FAQ: Agency.CapeHolidays Management Services

FAQ’s

FAQs: Accommodation Profitability (22)

You Can Identify With Loadshedding Frustrations And Its Negative Impact On Airbnb Guests.

Today I want to make a bold statement!

An investment in power backup will to not only protect your income but potentially increase it. Agent CapeHolidays

We can moan and groan, we can accuse and curse. But as you know it’s useless. We prefer to look for solutions rather than waste time fighting the madness of the past. 

Even if the future has its risks only the most pessimistic amongst us will not agree when I say the clouds have a silver lining. Let me stop dreaming… 

Today we received a note from a guest who booked one of our homes, saying, 

There is a lot of mention in the UK press about Eksom & the power outages. Is the house security system still operational during the outage? Is there a backup generator?Agent CapeHolidays

Current guests, mostly foreign, moan and groan as the lights go out. 

But it gets worse. Read what this host had to say and the consequences. 

airbnbloadsheddingcapetown

And Airbnb’s response….

airbnbloadsheddingcapetown

You may think Airbnb has gone wild. They should not have given a refund. Well, yes. They are in control. They do these kinds of things. And while they have no real opposition they will continue.  So, let’s not focus on what is out of our control.  

We have to fix what we can fix. We have a choice to eliminate guest’ objections; remove the disruption caused by load-shedding. 

As load-shedding fears get televised more and more guests will decide on staying where there is very little disruption. 

I recommend we fix it as soon as possible and in the most cost-effective way possible. 

What can we do about load shedding hassles as Airbnb Hosts and Owners? 

  1. We update our rules to notify all future guests we have load shedding. 
  2. What do we say to guests already booked? We need to decide. Tell them and they may cancel. Don’t tell them and they may cancel on arrival with no time to resell the dates. 
  3. Get the best cost-effective backup solution to cover the home’s power basic needs for three hours. 

What is meant by the most cost-effective power backup for limiting the frustrating load shedding to your Airbnb accommodation? 

Guests want to be distracted watching TV, working on their phones, watching a streaming sports channel. And one light would be great. 

But take the power away and they look for a scapegoat. One way to release frustration is to give your home a negative review. 

Now, I can hear you may say, “they are on holiday and should be out and about, they can do social media back at home!” 

Forgive me but, after very many years, listening to these kinds of jokes I am not really interested in countering this objection. It’s a dumb argument. Guests vote with their money. And if this is how some owners feel then you’ll feel it in your pocket. 😳

Now that I have that out of the way let’s continue……

I’ll suggest a solution to limit frustrations. It’s not a green off the grid solution. Those are 4 or 5 times more expensive. 

We need backup power to cover at least 3 hours in a 24 hour period. We suggest power to the following only:

  1. A single light source. 
  2. Internet modem. 
  3. DSTV or similar. 
  4. TV. 
  5. Telephone 
  6. Charging phones – although we suggest all things that need charging be done before load shedding. 
  7. Fan. 
  8. CCTV. 

To limit the investment further we suggest a power back solution to our Airbnb accommodation as follows:

  1. One battery or more depending on the needs. Batteries can be added later as well. 
  2. Batteries are charged using Eskom power when available. Therefore we don’t include solar panels. It can be done but will increase costs. 
  3. An inverter to provide power from the batteries. 
  4. A plugin and play system. Meaning a power backup system that is relatively mobile. This may allow us not to have to register power back with the local government. And no fancy electricians need to wire the kit. 

How much will such an Airbnb power backup system cost? 

Allow me to set the scene before I tell you the cost. 

If we get a two-week cancellation when someone arrives due to the lenient Airbnb allowing it due to load shedding you will potentially lose a lot more than the investment in a power backup system. An investment to not only protect your income but potentially increase it (more on this later)

With that out of the way…..

There are very many options and you can do your own homework.  I can share with you two simple options. 

  1.  Option one:  The basic unit is 1400Kva to support 720 watts of draw. A single 12v battery will supply the configuration mentioned (Tv, Wi-Fi, DStv, etc) for 3.5 hours. Installation’ is ridiculously simple. At R7650 for the battery and inverter kit. Dedicated deep cycle batteries.  Recommended. . BTW: If load-shedding gets worse it’s pretty cheap to add another battery.
  2. Option two: 2,4Kva (24v) lasts for more than six hours. R11800. This includes the inverter and two deep cycle batteries. See below for more on batteries. Really nice to have for long shutdowns but potentially too much.

Installed at your home with a dedicated manual on how to use it. For example, you do not want the ditsy one to stick a hairdryer in there and stuff the kit up. At the above costs. Obviously prices may fluctuate a little. 

Let’s have a look at the inverter and batteries. 

Silver-Calcium Deep Cycle batteries

airbnbloadsheddingcapetown

They may look exactly like car batteries – but car batteries simply could not stand up to the requirements of load shedding.

Only a heavy industrial battery will last. 

You can get Lead Acid Deep Cycle batteries – but if their charge drops below 50% when you use them, you damage them – and the damage is cumulative each time it dips under 50%.

Even if you don’t damage them, all you’ll get is 200 to 300 uses and that’s it for the battery.

This is why the experts only use Silver-Calcium Deep Cycle batteries – they keep on going-and-going – electricians predict for thousands of recharges.

Inverter: 

airbnbloadsheddingcapetown

1.4 Kva (12v) or 2,4Kva (24v): Pack the good looking inverter out of the box, plug it into the wall, plug your media center and other electronics into it – and… 

VOILA!! Just like that, load shedding becomes a meaningless non-issue

Not only do guests have no more objections, but Airbnb also has no reason to refund them and most importantly…. 

Your home will stand-out, for now, amongst the darkness called load shedding. 

How Do You Not Only Protect Your Airbnb Income But Rather Increases It?

I did a google search “Airbnb Loadshedding” and it’s no surprise two Airbnb listings in Cape Town advertise their accommodation as free from load shedding. As airbnbloadsheddingcapetown

And if guests have to choose will they choose your Cape Town Airbnb with a load shedding unhasseller or the quiet and dark house next door? 

You bet they will choose your home. And  potential not only protect your income but increases it.  Did I say this before? 

In these dark times, we don’t cry. We do what we can. Today. Not only does the backup power supply insure you against costly refunds you are a winner amongst the blind others who lag behind. Sounds familiar? Good things can be repeated 😁


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This is not the question you should ask CapeHolidays. We suggest you read what our guests and owner have to say about us.

  1. See what our Airbnb guest said about our Cape Town Accommodation here.
  2. We are SuperHosts because we do well. See the criteria for SuperHosts here. See the above link to see our SuperHost badge.
  3. We are not driven to be the biggest or largest Accommodation Agency in Cape Town. Our only drive is to be the best. This mindset is critical for our peace of mind and our homeowners and 1000s of guests.
  4. Why would more than 50 owners in and around Cape Town allow us to manage their accommodation? We must be doing something right. 
  5. Why would we be in this business from 2009 if we were to not trustworthy?
  6. Why would owners recommend us if we were not remarkable? See this redacted email we received from an owner wanting an Airbnb accommodation agent in Simonstown.

I hope you don’t mind but I was given your details by Carol, who says that you look after and manage her house in Simonstown. We recently bought a house in Simons Town. We intend to let our the house via Airbnb or Booking.com and wanted to make contact with you to see whether you would be interested in managing it for us. Owner
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Yes. We use a professional company to take photos. They are not a staging company and only come in a do the shoot. Their basic 20 package is very affordable. They also do a 40 shoot with drone shots. Larger properties (+4 bedrooms) do the 40 photo-shoot. It’s critical that professional the property is staged. Check the FAQ on Staging.
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Potential guests have very many choices. And we have found that photos sell. But photos do a lot better of selling if the home is staged. Guests need to imagine staying at your home. And guests book our homes faster than the norm as measured in occupancy by Airbnb.
Agency CapeHolidays use a Cape Town Airbnb professional stager to evaluate the home, recommend changes to the owner, and when all things are in place she will do the staging on day of the photoshoot.  The staging service starts at R450 depending on the scope of work and size of the accommodation.
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When you list your home it has  ZERO trustability ; no reviews and no bookings. 

More on the topic
Why Should I List With You If I can Do Airbnb
What do we provide for the commission we take?

But, when we list your home, under our Flag – CapeHolidays, your home is seen as a SuperHost home immediately. Our GOODWILL becomes yours.

To be SuperHosts:

We must maintain a 4.8 star rating with positive reviews (more on criteria).  Something we have achieved:

Superhosts CapeHolidays

As you can see we score 4.9 out 5 for every of the nearly 600 guests who reviewed us. Designed for success from 2009. 

For this reason, we are SuperHosts and very proud of it (see our profile at Airbnb). 

CapeHolidays SuperHosts

Obviously, we can, with confidence, say we are a successful professional Airbnb Agency in Cape Town.

Because of this Badge of Trust, we share it with owners who are willing to work with us and have remarkable accommodation. 

Unfortunately, choosing remarkability is not that easy. Why? Because the final judge is the very critical guest who paid to stay and have earned the right to review your home.

These guests come with high expectations. If your home fails at the first booking it will be uphill to recover. 

When we choose, the owner and/or the home, incorrectly we could lose our SuperHost status. Therefore, we must be supercritical before a holiday home is added to our portfolio.

Guests who book and see our SuperHost badge know:

  1. Superhosts are experienced hosts who provide a shining example for other hosts, and extraordinary experiences for their guests.
  2. When we reached Superhost status, a SuperHost badge automatically appears on our listing and profile to help guests identify us.
  3. Airbnb checks Superhosts’ activity four times a year, to ensure that the program highlights the people who are most dedicated to providing outstanding hospitality.

In other words, SuperHosts attract more business because of established trust. This overcomes the lack of trust you have when you list your home from ground-zero. It takes time and lower rates to attract guests when you are new and competing with the masses out there.

I have said it:

We choose our owners and homes very carefully. 

We are a team working together and the sky’s the limit. And there is nothing like reading reviews from happy guests. Wait. You’ll see. It’s fun to bank good money while everyone is happy!

Read more on criteria to become SuperHosts.

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The short answer: NO!

This is a common concern for new owners. As we implement our trust-building phase we use competitive rates to attract reluctant guests to stay and get reviews at the new accommodation. 

The Consequences of AirBnB’s Commoditization On Rates

It’s only after new owners become familiar with the painful reality and impact of AirBnB’s commoditization of the short term accommodation market, that they change their mind about our rate setting philosophy. 

After this introduction let me address the concern about low rates equaling bad guests

When we talk about low rates to buy trust we are talking about competitive rates only and not Rock-bottom rates. 

As you know, we don’t have the accommodation seeker’s trust yet, and we must use our only effective driver, namely rates, to overcome resistance to book. 

The guests who book initially are the same guest who may pay premium rate tomorrow. But with no reviews (trust) forget it. 

Only a remarkable holiday home at a bargain will do. 

In the market we operate, guests are not poor. 

Let me make a statement based on experience. 

Even if the rates are competitive you still get great guests. 

Now let me share why I say this:

The real risk is not bad guests but rather uneducated guests. With today’s social media profiles guests cannot hide any longer. 

And Forbes did a great job of explaining why guests’ requests to stay are sometimes declined more here.

We started our business in 2009. This was before social media. And many people left homes untidy as there was no recourse. Even owners got away with shoddy offerings. 

Today Your Social Profile Is A Valuable Asset

When a guest book and stay they review us. And these positive reviews made us SuperHosts. Trust! As guests depart we review them. And they establish trusting profile overtime. Today we all know the consequences of a bad review for both parties. 

Let me repeat: Even if the rate is competitive no guests will risk getting a bad review knowing other hosts will not approve them with a  bad previous review. 

The only risk for us is first time users on Airbnb. Unfortunately, they are not familiar with the implications of getting a bad review and how it impacts their future ability to use Airbnb. And some of them, ignorantly, will not leave the property in the same clean state they received it. 

When they get hit with a bad review they never again treat any Airbnb place poorly. And if they do they get blocked. 

Our challenge is to make it as difficult for new guests to book without first qualifying (See Forbes article above) them and then we educate them on what we expect. 

To answer the question: No. Competitive rates are not the cause of bad guests. Bad guests are mostly new guests unfamiliar with their responsibility.

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Many owners want CapeHolidays to manage their accommodation in Cape Town, Simonstown etc, list it with Airbnb and other; the problem is they may wonder if their home will make the grade. Some owners may have an inflated perception of value and expect the ultimate; obviously, when our knowledge of the market does not meet the owner’s expectations we sit with unnecessary conflict. It’s therefore not only the accommodation but includes qualifying the owner.

  1. You can do our free qualifying quiz (here) on your own and get an instant report today.
  2. You send us the best photos of your place. It can be cellphone photos. But it must show everything; the good and the not so good. As long as it’s everything.
  3. Our interest is in remarkable accommodation. Guests must be able to see classiness when they view your staged and professional photos. See FAQs for photos and staging.
  4. Old poorly maintained homes will not make it. Note: Guests are seriously critical.
  5. Remarkable accommodation with great entertainment, pool, beach location, romantic setting, etc, quality easier because guests pay a premium to stay in a house with a pool.
  6. The owner must qualify as well. We establish this by meeting with the owner and understanding her expectations. What incomes she expects against how flexible her rules are and if it is reasonable.

Read more here on how Agency.CapeHolidays.info does business getting 4.9 out of 5-star reviews every time.

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Instant Booking is one of the features hosts don’t really have an option with. Airbnb gives you another option where guests can first discuss a booking. But still, you cannot decline if you don’t have a very good reason. And guests don’t like being rejected when your calendar shows availability. And if we cancel the hosts will never keep their status as a SuperHost (see more). 

Let’s get to the details:

  • Instant booking means we must ensure 100% integrity of the calendar.
  • Any verified guest can reserve the accommodation immediately if the calendar shows availability. 
  • Any guest who instantly reserves do this by accepting our rules we set with the owner and the rules (T&Cs) by the booking sites like; Airbnb and Booking.com. 
  • All reservations must be accepted by the owner as he appointed us to do it per our T&Cs.
  • CapeHolidays don’t check availability with the owner before a guest do an instant reservation. 
  • But what about owner reservations? The owner agreed to first check availability with the agent at all times and only then reserve the accommodation for his own use.  
  • Owners cancelling guest reservations: cancellations carry no owner penalties only if the cause is a major disaster or something out of reasonable control. 
  • Owners ending/cancelling the agreement do it in writing. All current/confirmed reservations are honoured. Any owner not communicating the cancellation of the agreement will honour future bookings. If these are not communicated and/or honoured the owner is liable for penalties. 
  • All websites like Airbnb and Booking.com do instant bookings. This increases the chances of getting reservations. Read about Airbnb Instant Book here

What the above means is that everything works extremely well if the agent can ensure 100% calendar integrity. As agents or hosts, we cannot do our business best without instant booking

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Investment Advice in Airbnb Cape TownMore Property Investment Tips

Investment Advice for Airbnb Cape Town:

The obvious question is- how many bedrooms should my Airbnb ideally have?

My quick answer is that the number of bedrooms is a driver when trying to make money with Airbnb. 

 But! If everything is not equal; then other drivers are more important. 

Like The Following Airbnb Success Drivers: 

Location: Critical.

On the beach will “sell” on Airbnb long before any other.

Experience Airbnb Agent

We have two beautiful apartments against the mountain. The two-bedroom is royal but seventy steps up, with spectacular views. The one-bedroom is as great but at 15 steps only, also with views. However, income is not really different.

Interior and outside living:

 Guests pay premiums for funky or modern places with sun-filled light and inviting living areas. Imagine sun-loungers and a deck. It sells. 

Water:

I mentioned beach location; if you cannot bring the beach to your Airbnb accommodation then try a  pool or hot tub . And it does not matter if the sea is just 50 meters away. Airbnb guests will pay a premium for water.

Sun loungers, deck (and pool), amazing location with great interior and a view and you have a seller.

Experience Airbnb Agent

Marketing Philosophy and Rules: 

You cannot measure your Airbnb success until you have learned by failing. Going in with an attitude of….  “why do they need a pool? Can they not see the sea?” , or  “who wants to watch DSTV on holiday?”   or guests “ must pay high rates; I pay high rates at hotels!”  or  “they should stay a minimum seven days!”  

These comments are shortsighted and show ignorance. And will cost you dearly.

Should you invest in a two or three-bedroom Airbnb?

It matters only if  they look exactly the same, at the same location, with a similar interior.  If not, then most of the drivers above are critical.

 For more on investment advice: Airbnb Cape Town Airbnb success drivers,  I suggest you complete our free questionnaire. The questions we ask will assist in getting a better idea. And you may be surprised to know that your Airbnb rule sets may be a killer driver.

After you completed the questionnaire our calculator crunches “numbers” and sends you a report;  automatically emailed to you. More below. 

P.S. One bedrooms have a disadvantage as the change over costs for a one-bedroom Airbnb is as much as it is for a two-bedroom and even three bedrooms. Two-Bedroom change-over costs nearly as much as a 4 bedroom but if you give me two two-bedroom apartments next to each other then I take two x2. I’ll rent them as a 4 bedroom or 2x two bedrooms. But, I suppose this is not the only way to look at it. Now we are opening-up flexibility as a driver. See FAQ on flexibility here

But let me stress: we should never focus on cost. Cost should be driven down but be careful.  Cost is a negative concept.  If your one bedroom has everything I mentioned above and via the questionnaire then a one-bedroom can beat the best.

More reading:

  1. Is your Airbnb set up as flexible as possible? (FAQ here).
  2. Tips for buying Cape Town Airbnb accommodation (more here).
  3. Interior design will make or break your Airbnb Success (more here).
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Setup An AirbnbInvestment Advice: Airbnb Cape Town

Excellent question:

How Do You Setup An Airbnb In Cape Town?

Today I just want to discuss flexibility

Let’s kick off with this quote from the FAQ “Why Are The Number Of Bedrooms Not That Important?”

One-bedrooms have a disadvantage as the change over costs for a one-bedroom Airbnb is as much as it is for a two-bedroom and even a three bedroom. Two-Bedroom change-overs cost nearly as much as a 4 bedroom but if you give me two two-bedroom apartments next to each other then I take two x2. I’ll rent them as a 4 bedroom or 2x two bedrooms. But, I suppose this is not the only way to look at it.  Now we are opening-up flexibility as a drive. Experience Airbnb Agent
Setting Up An Airbnb Without Flexibility? You are leaving money on the table!
  • If you are looking at a 4 bedroom apartment then I’ll rather go for 2x two bedrooms next to each other. If you want to buy a 4 bedroom home then I would not consider two 2-bedroom homes. But if you consider building a 4 bedroom try and set them up to have two kitchens and be private if you choose. 
  • Beds. When we do the interior we tend to think large beds where two share the bed. Ideal for couples. But what happens if you have 4 single people who would not like to share? Always choose singles you can set up as kings. 
  • If you can do kings always do king beds, the least should be queen. And normal  double beds are close to being a waste . Not really but why? A bed is a once off investment; lasting a long time. And your beds should be flexible enough to cater to the tall, separated, and the huge. Do this and you will win over an owner ignorant to this basic. 



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Great question.

If You Can Do It! Do It!

The Question is Can You? Or  Do You Want To?  

More on the topic
Should I list With A SuperHost?
Must Read: What do we provide for the commission we take?

If you can list your accommodation on Airbnb and manage it yourself then it’s best you do it yourself because;

  1. Your Airbnb management costs (change over cost) should be less as you will not have to pay to use our professional SuperHost Cape Town Airbnb management services.
  2. You will have to perform at least 20% better the Cape Town average occupancy.
  3. You may have a lot of free time and this can be an adventurous challenge to try out.
  4. You may prefer to control who has access to your home as many homeowners don’t like being told by an agency how it should be done.

On the other hand an Airbnb Agent in Cape Town like Agency.Capeholidays may assist you better if the following are important?

  1. From day one your home – if qualified – is in the hands of a trusted Cape Town SuperHost (read more here) with nearly 1000 5 star reviews.
  2. I said, above, we at least get 20% more than the Cape Town norm. If it’s an extraordinary excellent home it may even do better. Have a look at Mbali at 87% occupancy where the norm is 34% by other hosts, Mbali was 40% when we took it over from another agency and then 27 days booked for December. Obviously I choose one of the best homes to share with you.  airbnboccupancycapetown
  3. Yes, the change over costs will be higher but your home is in the hands of professional Airbnb agents or Airbnb SuperHosts.
  4. Flexibility, liaison and personal availability 24/7; you will not have to worry about going away and being online all day long answering guests, liaising with guests or handling critical guests.

After all that is said and done; we believe it’s better for a Cape Town homeowner to try to become a SuperHost if they believe they have the time and attitude. If not, they may always feel a bit of resentment and that will not be ideal for our Agent & Owner relationship. We have been there. It’s not ideal. But when we have mutual trust we make a winning team.  

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Let me qualify: When is the best time for an owner to stay  at their property if they want to maximise income? 

Obviously, if you are not interested in a high return then it does not matter when you stay.

Let me pack it out for you:

  •  About 25-30% of your income will be generated between 15 December and 5 January. This is peak time. And people pay a massive premium for our remarkable Cape Town accommodation. It is therefore ideal if you do not to stay between these dates.
  •  The most popular date is 31 December.  Most peak time reservations include 31 December. Let’s say you stay over Christmas but depart on the 27 December then you can still get peak rates over 31 December. However, if you stay over 31 December but not over Christmas – forget it. People are reluctant to stay over Christmas for long and are not really willing to pay a massive premium. 
  • Winter is nearly dead. If you do it well you may get some income at 30% peak. If you are willing to do winter then it’s the best. But winter is winter. (May to end August).
  • September to 15 December improves. The weather is better. But no fireworks. And ideal if you can stay over this period.
  • January is better than the other pre-peak summer months. If you want to stay then try and stay after 5 January.
  •  February is after peak the most popular.  The rates are not peak but occupancy is very high; higher than December January. 
  • March and April are again slower and not a bad time to come and enjoy your home.
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How to set prices on Airbnb?

Let’s start with what is maximise income?”

“It must be stressed that the concept ‘maximise income’ is a short way of saying; make the home profitable but never at all cost. Only within reason!” Experienced Airbnb Agent

Maximising income is quite simple if you follow a strategy that works. This means you should focus on occupancy and not setting high rates, and on getting more reviews (trust) and  eliminating all resistance to book . Read the FAQ (1) where I discuss high rates and time-to-action (demand).

To set prices on Airbnb it depends on the number of reviews we have and the established demand.

Assuming we list a new property with no reviews and the owner wants to maximise income annually; we go through the following with the owner:

  1. After we have qualified the accommodation as being remarkable we discuss the owner’s income expectations.
  2. It’s critical to know what annual income the owner expects (Read more here on why we  must  know this). 
  3. We use the owner’s annual income, plug it into our income calculator and see what seasonal Airbnb rates and occupancy are required to achieve it. We start off using 35% occupancy as a guide and we adjust the rates to try and achieve this owner income.  If we can generate the annual expected income at 35% occupancy  and the rates are very competitive we know we have a great opportunity to meet or exceed the owner income expectations during year one. If during year one, we need 40% occupancy or higher to achieve the owner’s income goal, we know this owner – agent relationship may not last very well. Either the owner should lower her expectations or we would decline.

Airbnb Pricing Strategy Philosophy Part 1 

Airbnb Seasonal Rate Calculator Part 2 

Case Study 1: Airbnb Annual Income Expectations: Simonstown Villa:  

Let’s consider the following email from a new owner with a lovely 4 bedroom accommodation in Simonstown. She would not be able to manage her home or market it. This is what she told me after I asked her for her annual income expectations:

New Owner

The financial data was as follows for the period May 2018 to June 2019 – 12 months. The loft room was booked for 191 nights at an average of 752 rand per night and generated 143697 rands for the year. The garden suite was booked for 181 nights and had an average nightly revenue of 1419 and generated 256921k for the year. Total revenue after booking sites costs was 400618k. New Owner

This is really an achievement. 

Agent CapeHolidays

Interesting. And your logic makes sense. Obviously we need to see the home. And I believe if it gets foolproof remarkable interior with lots of flexibility like 8 single beds (can be made in Kings), for example, then it should exceed our own expectations.

These are the homes we prefer.

Looking at the figures you shared  the owner is doing 50% occupancy  during the year for both properties. Excellent. And a good sign. This means even higher occupancy/rates during summer as winter is relatively dead. The average Airbnb occupancy for this area is much lower. Obviously ours are on average 20% higher and winners a lot higher. But it took about 12 months of building trust with each property to get there.

New Owner

I would consider this a benchmark to use and hopefully surpass as the entire house would now be available at time that we are not there, this obviously also depends on when we plan to use it too.

For now my view is that we should be able to add a further 200k to the value above. To answer your question we would expect to achieve a minimum of what has been achieved historically and add up to 100k on top of this after costs and achieve a gross 550k before your 20% costs. This is a view based on the data we have, I am sure you will have a view, please could you give us your opinion and experience.

Reasonable! Who would argue?

Agent CapeHolidays

Due to various issues (like meeting expectations) we only start off a new home if we can achieve the owner’s goal at 35% occupancy. This does not mean we will not try and beat it. But agreeing to a new house where 50% occupancy is required, to achieve the R550 000 goal, then we may disappoint you before we start. And that’s not fair on you. Agreeing at the  kickoff stage to higher occupancy  than what is our norm will cause pressure to maximising rates rather than  working on getting trust, and adjusting rates to address occupancy based on supply and demand during the first 12 months.[/su_highlight

I must say that I am confident we can achieve 50% and higher occupancy to meet and exceed R550 000 but why make a promise just to keep the owner happy? Why not rather exceed expectations after 12 months?

Our Motto

We don’t have to be the biggest accommodation agency in Cape Town or Simonstown! No. We only want to be the best!

This implies that we   can walk away; as we are not trying to win a deal at all costs. No.  We rather shake hands and walk. Ensuring we will always look the owner in the face knowing we did what was best for both parties.

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The simple answer is that we manage all unique and remarkable Cape Town accommodation (see the areas we cover here).

We never said it must be luxury. Not necessarily. All we want is for guests to say Wow. Like these reviews (more here).

Airbnb reviews agency.capeholidays.info

But back to your question:

 If we consider peak rates ; our large homes rent for as much as R45000 per day, while small two-bedroom apartments about R2000 per night.

You can see the rates vary a lot. But let me just warn you; don’t get too excited looking at R45000 per night. Outside of peak this home will rent for a lot less. And very few homes will ever rent for R45000 per night.

You can read more on how to qualify your home here.

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Dear New Owner,

 

Today I’ll try and give you an answer. However, it will not be straightforward.
Before we share the answer to the million-dollar question we must qualify the owner’s expectations.

Let me explain.

Kicking off we ask the new owner   what income they expect per annum from the property 
The object is not in defining if the owner is a short term rental marketing expert. No. 

We use the owner’s answer to the question to verify if we can meet the owner’s expectations.

It’s critical to know from the owner; who is the investor, the overall caretaker, and person expecting a return on their money.
However, when we normally ask the owner…. 

It’s very common for the owner to say;

“We do not know the market and would not be able to tell…… you telling us what you feel we can expect as you know the market better as you say you are the experts”. Potential Homeowner

Correct! We are the experts!

And  we will guide the owner eventually  but an owner with unreasonable expectations is a concern.

Let me explain.

As I mentioned we use the owner’s annual income expectation to qualify the owner

 

We would rather know today to avoid disappointment tomorrow.Experience Airbnb Agent

For example: 

  1. If the  owner expects a lot more than what we can reasonably get  from the market then we know, to rather, stay clear of the owner. Let’s assume we don’t know the owner’s expectations and it is 2 x what is reasonable then we are going to have a massively disappointing relationship. It will fail as we did not know her expectations. 
  2. If the owner’s expectations are  in the ballpark we know we just overcame one of the obstacles to a good relationship. 
  3. If the owner’s  expectations are too low we can panel beat the expectations ; some times these owners tell us they only want a few profitable bookings. In the past when we did not know their low expectations; we bombarded them will ideas to maximise income while they were not interested. And this also causes strain. 
I am sure you now understand and would agree to our request to know what annual income you expect. Or would love to get.

How do you try and figure it out? 

You may want to at least cover costs monthly, or cover the bond, or make at least what you can do renting it out long term. These are good starts and we can work with that.

It’s not science. You cannot fail. Just go with your gut. 

Trust us on this. 

P.S. We are not real estate agents who want to make a quick buck. Our relationship must last for years.

But if we get it wrong let’s say goodbye before we fail each other.Experienced Agent


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We received this email from one of our owners asking if we can accommodate other agents who want to share our Cape Town accommodation:

We have a friend (from Austria ) who specializes in renting properties here in Mauritius to a close network of German and Austrian clients. As you have 100% sole mandate and control over the calendar if she booked via you at BNB rates, would you share a small portion of your commission with her? She says they also like Cape Town.

We have many agents we work with. All you do is ask her to contact us directly. We share the images, rules, descriptions, etc. She can make brochures of the home. We give her your Airbnb link to check rates and availability. The rates guests pay are the rate she quotes her guests. If it’s available we give her a 10% commission on the Airbnb fee. Easy.
Agents Contact Us Here!

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Excellent question, “how much can I make on Airbnb?” when you intend to list on Airbnb. But what about the Airbnb income calculator?

You get some great Airbnb profitability calculators; they tend to only use your property address and the number of bedrooms to calculate your Airbnb profitability. Well, let’s look at….

Airbnb’s own free calculator. For example; look at a two-bedroom in Cape Town. Airbnb suggests a monthly R26 531 (or +R300 000 or $22000 per annum). This is optimistic, to say the least. What about occupancy? I see the norm is a low 37% occupancy. Did they calculate this income at 100% occupancy? I just have too many questions. And you should as well.

Personally, I believe the calculators may be designed to lull you into listing your accommodation as very few people in Cape Town would not list their accommodation on Airbnb if they can get the above. You may even consider buying a property because of the high potential Airbnb income. Mistake.

We believe you must crawl before you run. And let’s rather be conservative.

And consider other factors as well.

Your potential income cannot be based on your neigbourhood and number of rooms only; yes, it’s a good start but what about the host’s attitude towards guests, your rules (minimum stays, cancellation policy, discounts, etc.), your location in relation to the beach (or related major attractions), pool, jacuzzi, features, willingness to invest in staging and professional photos? And the list of critical Airbnb income drivers grows.

It is for this reason that we developed an in house Airbnb quiz to try and determine if your Airbnb accommodation will make money. No bull.

The quiz, obviously, depends on your honesty. But the verdict will be better than using an Airbnb profitability calculator.  It may not answer your question; How much can I make on Airbnb? Calculator. No. But when you get the results from the Airbnb Profitability Quiz you will know; if your Airbnb accommodation will make money or not and what you need to correct it.

 

Get The Free Airbnb Profitability Quiz here.


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Meaning of MaximisingHow To Maximise Income

Maximising Airbnb accommodation income is “shorthand”  for our focus on (long term) profitability over a year. Instead of focusing on maximising daily rates we ensure with our philosophy to:

  1. Build trust – reviews and high ratings from happy guests.
  2. We base our Airbnb rates on demand. And demand depends on seasonality and mostly on trust.
  3. Maximising income does not mean we are unreasonable at any time; our guest will never say the rates are cheap; we are not and will not ever be cheap, but guests will tell you we are reasonable.
  4.  Our model of building a snowball of trust takes longer than a year. Getting 40 reviews needs patience (more here).
  5. But if we are lucky and demand jumps quickly to higher than 50% occupancy we increase rates. Let me add; we always adjust rates depending on demand. Always within reason.

Maximised income depends on trust; high rates depend on high demand.

As a Cape Town Airbnb accommodation agency;

Initially, you pay a price for the lack of trust. And you pay a price to get many positive reviews…… Our income only increases if your home improves at all times and your income improves.  Nothing else.

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How To Set PricesMeaning of Maximise Income

How to set prices on Airbnb, within reason, maximise income is quite simple if you follow a strategy that works. This means you should focus on occupancy and not setting high rates, on getting more reviews and eliminating resistance to book. Read the following FAQ where I discus high rates and time-to-action (demand).


Read FAQ (Will I Make Money Setting High Rates On Airbnb)


To set prices on Airbnb depends on the number of reviews we have and the established demand. Assuming we list a new property with no reviews and the owner wants to maximise income annually; we go through the following with the owner:

  1. After we have qualified the accommodation as being remarkable we discuss the owner’s income expectations.
  2. It’s critical to know what annual income the owner expects. The owner, in most cases, tells us; “you are the experts you must tell me!”, this is correct; we are the experts and we will guide the owner but an owner without some expectations is a concern. The owner may want to cover costs, her bond, or make at least what she can do renting it out long term. These are good starts and we can work with that.
  3. We use the owner’s annual income, plug it into our income calculator and see what seasonal Airbnb rates and occupancy are required to achieve it. We start off using 35% occupancy as a guide and we adjust the rates to try and achieve this owner income. If we can generate the income at 35% occupancy and the rates are very competitive we know we have a great opportunity to meet or exceed owner income expectations during year one. If we need 40% occupancy or higher or even higher rates we know this owner – agent relationship may not kick-off very well. Either the owner should lower her expectations or we would decline.

Airbnb Pricing Strategy Philosophy Part 1 

Airbnb Seasonal Rate Calculator Part 2 

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Load-shedding affects us all negatively. And Airbnb guests are frustrated. Obviously we can see load-shedding as a curse or we can do better than our Airbnb host next door in making guests happier than they ever expected.

Unfortunately, the load-shedding curse has consequences; if you are not interested in fixing the issues it will negatively affect your income.  It may even cause your house to burn down.  And we had such a close encounter yesterday. Luck was on our side.

Unsuspecting guests booked into the beautiful Mbali. They went out and left the “things” to charge. When the power got back the surge caused an issue; heat, then a flame and the next thing a fire.
CapeTown airbnb Loadshedding
This is not one of the emails with photos we like to send any of our owners ever:
 loadsheddingairbnbcapetown
“When the power came back on, after load-shedding, there was a power surge that sparked an electrical fire in the main bedroom. Thanks to the quick responses from Security and the fire department the house is ok. The main bedroom has water and smoke damage as the carpet caught alight. Beyond that, all seems OK”.

How Do Propose You Fix These Load-Shedding Issues?

  1. The obvious conclusion we can draw is that guests must unplug and switch plugs off.  But you are missing the FOOL. Guests are sophisticated FOOLs. It’s also called Murphy. If it can go wrong it will go wrong.  The only way to resolve this issue is to take full responsibility, do a FOOLPROOF Audit try and make it impossible for guests to make mistakes. The following steps are designed to protect you from Murphy……
  2. It’s critical that all owners install power surge protectors as soon as possible. With labour it should be less than R1000.
  3. We highly recommend owners invest in a simple power backup system at about R8000 (after discount). Not only will it ensure income it may even increase it. More here on what we suggest.
  4. If you don’t have a gas stovetop we suggest a one plate gas burner (more here).
  5. Fire and monoxide detector should be a standard fixture to any home.
  6. Ensure that you have liability insurance against guest claims and your insurance guys are aware you are doing short term rentals. 

Even though this could have been a major disaster; quick action by many roleplayers prevented a calamity. And it was great to get the owner sharing the following with us:

Elmarie,

Thank goodness I have the best team ever, I appreciate all you are doing to get us back in business.
It was quite a shock to read what happened. I had no idea about Surge adapters and will now investigate what they are and if I need them anywhere else.

 


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You should invest in Netflix, DSTV and other streaming applications. This assumes you have invested in  uncapped Wi-Fi . Uncapped fast internet is non-negotiable.

What streaming apps should I have for my Airbnb?

  • Netflix
  • Showmax
  • DSTV NOW
  • YouTube
  • Music streaming
  • Games – (not streaming).

How do I get Netflix on my TV?

The best choice is a smart TV (more here) with built-in streaming functionality. If you don’t have a fancy smart TV then you need to see if you have a HDMI slot on your TV.

Click here to see what an HDMI slot looks like.

If you don’t have an HDMI slot on your TV then rather buy a smart TV. However, if you have a spare HDMI slot on your TV then either get an Apple Box or Android Box (we recommend this Android box. It’s more expensive than some but reliable and you can add DSTV).

How Do I Install DSTV on my smart TV or Smart Box?

How to install DSTV is not always that simple. Most boxes come with pre-installed DSTV, Netflix, and others. But if it not then it may be a bit of a problem. Unfortunately, the Smart Boxes or Smart TVs are limited as to what you can download and install. These limitations on Android boxes/TVs are due to Google. Why? I don’t know. 

On the Smart TV or Smart Box, you can access Google Play where you should be able to get Netflix and DSTV Now and install it. See how to install DSTV Now, here.

 What is cool is that you can add your Home DSTV account credentials to your DSTV Now application and watch DSTV on this device for free. You don’t pay extra.  Ideal for guests and excellent for reducing costs .

This means you don’t need to pay DSTV at home and at your Airbnb. If you want to be a scrooge you can even leave it for guests to use their own DTSV account login details but this will limit many British and other foreign English speaking guests who like to watch DSTV and DSTV sport.

The same is true for Netflix. With Netflix, I don’t suggest you install it with your account details. No. Each guest familiar with Netflix should use their own account credentials. 

Do This! And you have just invested in more 5 star reviews.

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I just received this concern from an owner. Basically saying, how do I find my accommodation on Agency.CapeHolidays.Info searching Google?

cannotfindmyaccommodationongoogle

I just type Cape Holidays into my browser. Friends have done the same and have the same experience…i.e. they can’t find my house. I’m sure it is taking me to the old site then. But if so it is taking anyone entering Cape holidays there…this may affect the marketing of the house negatively.

My answer is not short but I’ll limit it as far as possible:

Thanks for your question or rather a concern.

Unfortunately, the way you search or friends search for a specific home, using Google, is no longer the way we try and market accommodation.

Let me also say that your inability to find your home as described  has a very limited effect on your occupancy. 

We operate like Pareto.

We had to learn to focus our attention where it really matters. It does not help we focus 95% of our efforts on something bringing in less than 5% return.

BTW. We are not in the business of leaving money on the table. As you know, there is no reason to  plod along a route that is not profitable, not easy, or without unnecessary investment in a loss while trying to conquer Google SEO. 

Today, our website is like a business card today. It’s a place where we share our listings but don’t expect any massive income or traffic from it.

The general competition by big powers like Google, Airbnb, Booking.com, TripAdvisor, and others are severe. And we have to decide which is the most effective and the less evil of the lot.

An accommodation-agency-website generates very little sales today. And those inquiries you get are not only not qualified they are poorly informed, and most tend to be cheapskates who are not familiar with Airbnb  Booking.com and others. If today and you are not familiar with Airbnb then I am skeptical if you can afford to stay with us. 

We do SEO but  Google rather wants us to pay them dear money to get attention . If you look at a search within Google you’ll see about 50% of the page is taken by Google ads.

Trying to win the search engine optimisation game is like a keen school boy trying to play Springbok rugby. Google wants you to play rugby but the dice is loaded in favour of Google. You are competing against Google’s money making goals. The more successful you are with free SEO the less successful is Google. And they are there to squash the daily living light out of you. 

When you pay Google Ads you get what you want and ask for. We can pay Google on your behalf. But we decided against it. Why?

 Google demands money irrespective of success. 

We have taken a conscious decision to let Airbnb and others pay Google. And they do advertise. And we benefit indirectly.

 With Airbnb, we also pay but it’s controlled. You pay only for a successful reservation. The same for other listings sites.  

We have focused our attention since Airbnb took over and Google started aggressively selling their adverts, on marketing via listings sites (Airbnb etc). And using our website as a business card.

Today we are professionals at it with a success record we can be proud of. Like being SuperHosts managing more than 50 Cape Town Airbnb properties an achieving between 20% and 50% higher occupancy than the norm. 

Therefore searching for accommodation and finding Agency.CapeHolidays.Info is not really how we any longer try and market your home or any home for that matter. Any enquiry we get from our site is a bonus. 

If you want to share your home with friends it’s better to visit Agency.CapeHolidays.Info find your home and send your friends a link to your listing (Link here https://agency.capeholidays.info/listings/5-bedrooms-accommodation-simonstown/)

BTW if you search the following you’ll see your home in 11 position.

Have a look at all the Google ads and other stuff Google adds to make this more and more difficult to market via SEO – as you indirectly suggested.

Search via Google for Queens Villa Simonstown.

PS. With your home running at such high occupancy shows we are doing it right. And next year with all the additional reviews it will do even better. This house is and will be a mass success. But we cannot not focus too much (any) attention on completing with Google.

P.P.S. We prefer to find ways to focus on identifying 20% of any drivers  bring us 80% income. Today Airbnb brings us more than 90% of our reservations. Not only is the process simple, and reliable it also brings the best out in guests. Airbnb guests are a different breed than guests from agency websites. This is because of social profiles populated with reviews from hosts where they stayed.

This was a great and important question to ask but any Accommodation Agency should be open to new ways and criticisms from owners. And we welcome it. 👍 

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