In the previous posts we described condominium associations in Maui http://activerain.com/blogsview/2403151/3-must-knows-for-buying-maui-real-estate
How much your association fees should be http://activerain.com/blogsview/2404863/3-things-you-must-know-before-you-buy-a-condo-in-maui-part-2
What to look for in your association’s documents during your due diligence http://activerain.com/blogsview/2408558/3-things-you-must-know-before-you-buy-a-condo-on-maui-part-3
What your rental options are http://activerain.com/blogsview/2411793/3-things-you-must-know-before-you-buy-a-condo-on-maui-part-4
And what do you need to know about AOAO outsourced rental management companies? http://activerain.com/blogsview/2419518/3-things-you-must-know-before-you-buy-a-condo-on-maui-part-5
The next few posts will describe how to rent out your Maui condo. You have a few options and I’ll give some of the pros and cons of each.
AOAO Outsourced Rental Management Companies
At larger condominium developments like Kaanapali Shores and aina-nalu, the AOAO tends to hire a seasoned management company, i.e., Aston, Outrigger, and the like, to manage the rental operations.
These types of management companies make your condo ownership and rental completely turnkey. They have marketing power and get favorable treatment from travel agencies including big vendors like Expedia. They know how to make guests feel well taken care of and deliver a consistently high level of service.
It is not unusual for condos managed by these types of companies to average occupancy rates of 75% to over 90% and be completely sold out during high season.
If there are employee issues, they are handled by management. If there are management issues, they will be handled by the parent company. You will likely never have to get involved at all, and, in most cases, won’t even hear about it.
These companies do a lot for you and make your ownership worry free. They also take between 45% and 50% of your revenue.
Off-site Rental Management Companies
Just because your AOAO chooses a management company or decides to run its own program, you are not under any obligation to participate. The company you choose to manage your property is entirely your decision.
Some condo owners opt for off-site management companies instead of going along with the crowd.
Off-site companies tend to charge less for their services, we’ve heard of rates as low as 25%. Of course, they usually have lower occupancy rates as well.
If you own a condo managed by an off-site company, you should be getting an occupancy rate of at least 50%. Our expectation for oceanfront complexes would be higher.
There is only 1 acceptable reason for a lower occupancy rate. You. If you hold your unit for personal use during the high season, when occupancy rates are frequently at 100%, you can’t expect to achieve big numbers during the off months – spring and fall – when tourism rates are naturally lower.
Finally, on rentals, I’ll give you some do’s and don’ts, and pros and cons about “do it yourself” rental. Or read the entire article 3 things you must know before you buy a condo on Maui.
And visit our website for other information about owning real estate in Maui and Hawaii, www.AlohaPotts.com.
Lahaina Lee Potts