How to Manage a Vacation Rental Property (and Short-Term Rentals) in 2026

Over the last few years, active vacation rental property listings in the US have increased by 56% as more investors and property owners capitalize on rising demand for short-term rentals.

With a growing supply of alternative lodgings for travelers and remote workers, here are some steps that will help you learn how to manage a vacation rental like a pro and keep your booking calendar full.

Key takeaways

• Understand the local regulations, taxes, and licensing requirements to ensure you avoid legal issues.
• Include furnishing, safety updates, utilities, management fees, and regular maintenance when calculating profitability.
• Analyze comparable properties, factor in seasonal changes, and leverage dynamic pricing and multiple booking platforms to maximize occupancy and revenue.
• Add thoughtful touches such as welcome baskets, guidebooks, and smart home systems to earn more positive reviews, repeat bookings, and overall guest satisfaction.
• Use a dedicated vacation rental financial management platform like Baselane to efficiently monitor cash flow, expenses, and property-level performance.

How to manage a vacation rental property

Managing vacation rental properties requires a strategic approach that combines working on various aspects of your property—from offering a 5-star guest experience to keeping tabs on state laws and regulations.

To effectively manage vacation rentals, follow these tips for short-term rental property management.

Understand legal and tax implications

Research local short-term regulations before buying a vacation rental property. Some rental policies can limit your return on investment.

For example, short-term rental stays in New York must be at least 30 days. This excludes potential guests booking shorter trips, which typically last about 5 nights on holiday rental channels.

If your vacation home is rented for more than 14 days annually, you are bound to report the collected income for tax purposes. However, you can deduct operating expenses and other costs for vacation rental property management.

The table below illustrates how laws can differ between states. Make sure to check your state laws to avoid headaches in the future.

Related: 11 Best Property Tax Management Software

Calculate start-up and ongoing costs

Initial costs for a vacation rental include safety updates, furnishing (average $9000-$15,000 for a two-bedroom property), and utility setup. Use tools like AirDNA for market-specific income forecasts and compare costs for running a vacation rental business.

Budget for ongoing expenses, such as property management fees (typically 10-30% of rental income), maintenance (around 1% of the property value annually), and utilities (around $200 per month).

Optimize pricing strategy

Vacation rental pricing depends on factors like location, property size, amenities, seasonality, and local demand. Start by analyzing comparable listings in your area to set a competitive baseline.

For example, when setting the price for a two-bedroom vacation rental in Orlando, you should use the average daily rates of nearby properties with similar features as a benchmark.

From there, factor in occupancy trends and operating costs. Your nightly rate should cover expenses and generate profit without being so high that it drives vacancies. Seasonal demand, local events, and premium amenities can justify higher rates during peak periods, while slower seasons may require more competitive pricing.

To avoid leaving money on the table, use market-driven dynamic pricing rather than a fixed nightly rate. Dynamic pricing tools automatically adjust your rates based on demand forecasts, competitor pricing, seasonal change, and local events—helping you maximize income during high-demand periods and maintain occupancy when demand softens.

Centralize and optimize your booking channels

Managing multiple listing platforms can quickly become overwhelming—but a centralized approach keeps your bookings organized and profitable.

• List property across platforms: Advertise your short-term rental on high-traffic sites like Airbnb, Vrbo, and Booking.com to get visibility and attract both local and international guests.
• Use a channel manager to sync calendars: A channel manager or property management software automatically synchronizes availability, pricing, and reservations across platforms, preventing double bookings that can lead to cancellations, fees, and reputational damage.
• Optimize your listings for conversions: Stand out with high-quality photos and clear, compelling descriptions that highlight top-notch amenities, location benefits, and guest-friendly features.
• Monitor and account for platform fees: Each platform charges booking fees (for example, Airbnb typically charges around 3% to hosts), which you should factor into your pricing strategy.
• Reduce commissions with direct bookings: Platform commissions—often 15–20%—can cut into your profits. Encourage repeat and direct bookings by creating a simple branded website and offering past guests exclusive deals or incentives.

Enhance the guest experience with smart automation

Luxury upgrades aside, thoughtful touches and time-saving automation can help you collect good-quality reviews and repeat bookings.

• Add thoughtful welcome touches: Small investments, like a $10–$15 welcome basket with local snacks, a map, and a personalized note, create a strong first impression and boost guest loyalty.
• Create a local guidebook: Provide a printed or digital guide with nearby attractions, restaurant recommendations, grocery stores, transportation details, emergency contacts, house rules, and space for guest feedback.
• Use smart home systems: Smart thermostats (around $200) allow remote temperature control and help reduce energy costs, while basic security systems (starting around $100) improve guest and property safety.
• Automate check-in and check-out: Smart locks ($200–$300) enable self check-in with unique access codes per booking, removing key handoffs and simplifying arrival and departure for guests.

Build a reliable operations & support system

A successful short-term rental strategy depends on people and services behind the scenes that help reduce guest issues, limit downtime, and protect your time.

Consider hiring a property manager

A vacation rental property manager can handle guest-facing and operational tasks, including managing booking calendars, responding to guest messages, coordinating maintenance requests, handling emergencies, and overseeing property upkeep. This can be especially valuable if you manage your vacation rental remotely or want to reduce day-to-day involvement.

Property management fees vary widely by company and service level, typically ranging from 10% to 50% of rental income.

Find reliable local contractors

Unexpected repairs are part of owning a vacation rental, which is why having trusted local contractors is essential. Research and establish relationships with plumbers, electricians, handymen, and maintenance providers before issues arise.

Costs vary based on location, urgency, and contractor experience. For example, emergency plumbing services often cost $120 to $300 per hour on nights and weekends, and $225 to $450 or more on holidays.

Hire a professional cleaning service

A professional cleaning service ensures your property is always prepared between guest stays and helps maintain high cleanliness standards, which directly impact reviews and occupancy.

Most vacation rental platforms allow hosts to charge guests a cleaning fee that covers these costs. These fees vary by property size. Before charging these fees, make sure you know the average fees in your area or state. According to AirDNA data, the average Airbnb cleaning fee in 2025 was $161.10 per stay, making it the third-highest among countries.

Protect your property and your liability

Vacation rentals carry a higher risk than traditional long-term rentals. Proper insurance coverage and clearly defined policies help protect both your property and personal assets.

Get the right commercial short-term rental insurance

Standard homeowner insurance policies often exclude claims related to business activity, leaving you exposed to significant financial risk. A serious liability claim could jeopardize your personal assets. Get short-term rental insurance that includes coverage for property damage, guest-related liability, and lost rental income during repairs or downtime.

Create a strong security deposit and house rules system

Protect your property by asking guests to agree in writing to clear house rules, including noise restrictions, maximum occupancy, and quiet hours. This helps reduce disputes and strengthen your position if issues arise.

Pay close attention to security deposit rules in your state, as you must hold these funds in compliance with local laws. In many states, including Connecticut and Pennsylvania, security deposits must be kept in a separate, non-operational account (such as an escrow or trust account). So, it’s essential to use a transparent and compliant system for managing these funds.

Related: How to collect security deposits

Use vacation rental management software

While many vacation rental management platforms offer basic income reporting, they often fail to track crucial elements like operating expenses or other revenue streams related to your rental business.

Baselane, a real estate-focused financial management platform, makes managing the financial side of your vacation rental properties exceptionally easy by integrating banking, bookkeeping, and payment tools all in one place.

• Landlord banking: You can open unlimited checking and high-yield savings accounts to separate funds by property. This way, you get a clear picture, ensuring income, operating expenses, and legally required security deposits are never commingled.
• Bookkeeping: With built-in automated bookkeeping, every cleaning fee, maintenance bill paid, or security deposit received automatically gets categorized.
• Reporting: You get property-level real-time reports about your cash flow, P&L, and tax packages to evaluate your rental’s profitability.

Baselane has been great for me. I was struggling to find a platform and approach for accounting and bookkeeping. I either had to pay someone or figure out all the advanced features of other software. Baselane helped bring together my activities in one (bookkeeping for short-term rental, long-term rental, rent collection, and banking) and has significantly improved things for me! ~ Dante Myers

Vacation rental maintenance checklist​

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Manage your vacation rental like a pro

A successful vacation rental business has many moving parts—managing reservations, guest communication, and property maintenance can make staying on top of finances a challenge.

The key to long-term success lies in streamlining operations, optimizing revenue, and protecting your investment. Baselane makes financial management of your short-term rentals effortless by combining banking, bookkeeping, and reporting in one place—so you can focus on growing your vacation rental business while keeping your finances organized and compliant. Open your Baselane account today!