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A Case Study: Understanding the Value of Good Design and the Increase in Rental Returns
Many years ago, I was sitting at a reception in the UK. I was idly watching two young girls playing together. One was pretty, the other, I’d say, destined to be beautiful. That begged the question of, “what was the difference?” They were both of similar stature and had the glow of beauty that comes with the onset of adulthood. It was not their fashion sense or, indeed, really their looks. It was maybe more their confidence, their poise, and the way they carried themselves. It was, in essence, a myriad of subtleties that worked together all at once. I remember the moment even after so many years. Beauty is subtle, the details and the balance of a vista, and less so in the obvious.
People are visual by nature. Some 70% of what we understand is derived from what we see. What we “visualize.” So it’s not off the mark to suggest that we are indeed moved by what we are presented visually. Pay attention to the visual impact of your investment and reap the rewards for your work. OK, so that’s the easy part out of the way. Let us now become a bit more granular.
Why Good Design Matters
Before we get to the nub of the issue, let us pose the question, “Why bother?” That’s an easy one to answer. Within the realm of the luxury vacation rental business, many of our guest’s first encounter with a rental home is via the photos presented online. In this industry, the top 10% of vacation rentals in a given area generally command a rental income in excess of 20% compared to Joe average. That income is a mixture of improved rental rates and higher occupancy. It gets better, though. That additional income goes directly to the bottom line. Thus a little effort up front and your net income could potentially double for a given property. How is that for return on investment?
Our Recent Experience in Palmetto Bluff
We recently bought a well-presented property in Palmetto Bluff, the gated, resort community in Bluffton SC, where we currently own other rentals in our portfolio. This property is located within Wilson Village and zoned for Short Term Rental use. The property had been newly renovated and very well maintained, so we considered it a good investment and paid above the asking price for the privilege. If it suffered from anything, it was a tendency to blandness. Everything was a pastel sea of sameness, muted almost to the point of silence. To be fair, the sellers had nicely appointed it, but with no plans to use it as a short term rental investment, it was decidedly to their own taste. While it would offend no one, by the same measure, it would hide amongst every similar rental in the area, and our standard for return on investment (ROI) is to well exceed the average. For us, returning to the point made earlier, bookings are all about the visuals, reviews are all about the experience once the guest arrives.
The Design Plan
So with a budget of $16,000 we set our team on to the task of creating a rental experience designed to deliver visually interesting and comfortable interiors that would resonate with our rather discerning clientele. With the tools that already exist in their considerable toolbox of talents here were the goals for the team:
- Repurpose existing fixtures and fittings
- Relocate and better stage existing items
- Locate well-priced accent pieces in Bluffton, Savannah, or Charleston
- Improve and standardize towels and linens
- Invest in some good photography
Look at the “before and afters” to illustrate the effect of what can be achieved.
Before & Afters:
And the end result? Drayton Daydreaming went on to the market as a rental on 16th December 2021. It immediately booked guests for the Christmas and New Year holidays, is nearly fully booked through to mid-Feb 2022, and we have taken multiple spring & summer bookings.
Our Luxury Simplified Retreats team is a top 3 company in South Carolina for Average Daily Rate and Occupancy (AirDNA November 2020). We aim to maximize our owner return and our renter experience, and our team is skilled at achieving exactly this. Why not ask how we could help your own property achieve the same results? Click below to learn more.