Lowcountry Property Owner Update 12-8-23

Lowcountry Vacation Properties – November Update

December 8, 2023

John F. Kennedy once said “As we express our gratitude, we must never forget that the highest appreciation is not to utter words, but to live by them”.

As we head into the holiday season, Karen, Ellie, and I have much to be grateful for in 2023.  On the very top of this list is our gratitude towards you for giving us this amazing opportunity to be your representative on the Isle of Palms and to care for your home.  In starting Lowcountry Vacation Properties, we are working towards our dream that has only been made possible by your support, trust, and faith in us.   

I know we can do more, and we must continue to improve and change, but I so proud of our accomplishments so far and from the feedback we have received from property owner partners and guests.  

Here are two recent comments that we have received from property owner partners.

“I also wanted to share that in all the years we have rented our property, I have never been happy walking into the unit after being gone for several months until this time. Thank you so much for the excellent care you provided for our home.”

“Good evening! I cannot even begin to tell you how HAPPY I was to walk into my beautiful home and not have to rearrange the furniture. It’s the first time in a very long time that I have truly enjoyed walking through the door. I cannot thank you enough for this.”

In November, we continued to maintain a 100.0% 5 Star Rating with Airbnb.  Here is just a few comments that we received from Airbnb guests:

“This place was even better than the listing! Everything was absolutely perfect!” The View

“Turtle cove was a great retreat before the holidays - coffee and naps on the porch hearing the waves was a highlight. The place was exactly as described, comfortable, clean and cozy. Michael was extremely responsive and had lots of recommendations for local fare and activities. Highly recommend!”  Turtle Cove

“Michael was a great host. Place is roomy, great location, clean, well supplied. His recommendations of things to do & places to eat were great. We want to return!” Carolina Saltaire

“Amazing! This property exceeded our expectations in every way. I would highly recommend!”  The Sandpiper

Bigger is not better, better is better. As we enter 2024, the Lowcountry Vacation Properties Team will do all is possible to show our gratitude through our actions to be better.  

Market Trends To Know for the End of 2023 and Beyond

Vacation Rental Managers Association (VRMA) recently published an article looking at market trends for the end of the year and start of 2024.  Here is a selection of the trends that they see:

·       The last few months they have seen drastically fewer listings added to the vacation rental market.  Whereas peak season 2022 saw upwards of 70 percent year on year listing growth, 2023 has been a different story.  Since March, VRMA has seen negative year on year supply growth.  The trend is clear, major mark saturation in 2022 and glut of supply led to underwhelming revenues in 2023.  Now, less competition is being added to the market.

Bringing this back to the Isle of Palms, this is the message that we have been trying to communicate to residents and city leaders.  The market tends to regulate the number of vacation rentals in the community.  High real estate prices and even higher interest rates decrease the number of new buyers looking to purchase a home on the island.  It has been decades since rental income can pay all the monthly expenses of ownership plus, taxes, insurance, and the mortgage of vacation home on the island.  But, when rental income cannot even offset two of these ownership costs, new buyers look elsewhere.  Market changes have maintained the ratio of 33% of properties on the island being vacation homes.  

·       No major price slashing and no unprecedented discounting is expected in 2024.  Hosts and managers seem confident that there’s enough demand to maintain nightly rates moving forward.  

There were exceptions, but 2023 for most was a difficult year.  With market saturation, decrease demand and increase competition from overseas markets, rental rates had to be cut to drive occupancy. 

·       Since a correction after the pandemic-driven shift to vacation rentals, each year has seen a gradual increase in the percentage of demand going to vacation rentals.

Especially for larger, two-plus bedroom units, travelers are increasingly opting for vacation rentals over hotels. The trend is even more pronounced when we look at revenue, as opposed to nights booked.

·       Even despite slowing supply growth and peaking demand, the truth is that these two trends aren’t strong enough to offset occupancy and revenue per available room (RevPAR) dips.  Across the US short-term rental industry, VRMA is predicting a 1.6 percent drop in occupancy rates by the end of the year—from 59.4 percent to 57.8 percent—and a 1.7 percent dip in RevPAR.  While VRMA expect the occupancy dips to extend through 2024, RevPAR should turn the corner with a 0.2 percent increase.

RevPAR is Revenue per available room and is used in the hospitality industry to measure performance.  It is calculated by multiplying a properties average daily rate by is occupancy rate.

Lowcountry Vacation Properties In 2024

To best position your home for success in 2024, Lowcountry Vacation Properties is taking the following steps.

·       We are expanding the number of online rental agencies where your home is marketed.  Since opening on May 5th, each property has been featured on the Lowcountry website, Airbnb, VRBO and Google.  We are doubling our efforts in 2024!  Each home on the Lowcountry Team will soon be marketed on Booking.com and Hopper with select properties featured by Homes & Villas by Marriott Bonvoy.  In addition, I am working to place properties interested in long-term winter rentals on Furnish Finder and Zillow.  

·       I am excited to continue to build on my relationship with RevMax and our Revenue Manager Sabrina Daugherty.  Sabrina’s experience, local knowledge and sixth sense for the market are incredibly helpful to me.  From setting rental rates, creating listing headers, to the order of photos, Sabrina is watching closely each home on the Lowcountry Team. 

·       Last month, I shared with you two of our new programs for 2024.  First, we are creating a coffee bar in each property where a guest has an option for coffee makers and are provided with Charleston Roaster coffee, cream, sugar and sweeteners.  Second, we will be providing pool/beach towels in each home.  The Lowcountry Team will continue our partnership with the Isle of Palms Beach Chair Company so that each guest has two large wooden beach chairs and a traditional beach umbrella set up on the beach for them each day, including the day of their arrival.    

·       Starting in March, we will be growing our staff!  

Karen, Ellie and I will be forever in your debt for the chance to earn once again your trust and confidence.  We have a vested interest in making your home a tremendous success, not only from the guest experience viewpoint, but our goal is for every property owner to be truly happy when they come home to the island.