July 5, 2011 (Nags Head, NC)

“With a solid background in vacation rental management operations, we are excited about the continued growth and success of Resort Realty with Stuart leading the charge!”says Michael Harrington, CEO of Resort Realty.

During Pack’s nine years at Hatteras Realty (based in Avon, NC), he held positions of Director of Accounting to Vice President and General Manager overseeing approximately 575 vacation rental homes.  In addition, Pack was most recently the COO and General Manager at Vacation Rental Pros^LLC, in St. Augustine Beach, Florida, in charge of all day-to-day operations. 

“Resort Realty is an industry leader and is committed to “A New Generation of Vacation Excellence”.  I personally agree and will promote this philosophy. Furthermore, I will support Resort Realty’s mission for clear communications, excellent maintenance and housekeeping, and maximum rental incomes for homeowners. I believe in great customer service and same day callback communications.”

With three offices and a staff of nearly 75 (including 35 sales agents), Resort Realty under the leadership of Harrington and Pack, will continue to grow by utilizing the most innovative techniques and unparalleled customer service.

“I worked with Stuart at Hatteras Realty and am confident that together with our dedicated staff, we will continue to foster admiration and respect among our peers and loyalty from our vacation rental homeowners and real estate sales clients,” states Harrington.

Pack has a true understanding of the Outer Banks rentals market having lived in the area for many years and is excited to return again to put his experience to work. He currently resides in Kitty Hawk with his wife Suzanne, a math teacher at Manteo High School, and four children. 

About Resort Realty: Resort Realty is one of the Outer Banks leading sales and rental companies of vacation homes.  Resort Realty’s Sales division is affiliated with the strongest global referral network, Leading Real Estate Companies of the World.  With offices located in Duck, Corolla and Nags Head, Resort Realty has served the area for 24 years. Resort Realty currently manages approximately 500 vacation homes on the Outer Banks, from Corolla to South Nags Head.  To learn more about owning or renting a beach getaway, visit www.resortrealty.com or call 800-458-3830. 

Media Contact:

Jenna Pempek, Marketing Director

(252) 441-5000, ext. 2048

Jenna.Pempek@resortrealty.com

                A number of factors went into his positive assessment, although he did raise concerns about gas prices and noted that the national debt is a sword of Damocles that must be addressed.

                Of more immediate and local interest, Kleckley discussed why visitation to the Outer Banks has remained consistently high. Even as the U.S. economy was shedding jobs with a national unemployment average that topped 10%, people continued to come and stay in Outer Banks vacations rentals.

                Kleckley pointed out, that neither Virginia nor Raleigh–the primary markets for this region–saw the large scale contractions other parts of the country did. Unemployment in the Raleigh area ranged from 6.3-7.5% and in Virginia, the state’s unemployment rate never rose above 8%.

                Retail sales–which are linked to tourism–will continue to grow. Even as the nation’s retail sales dipped 6-8% in a quarter, the tax revenues from this area did not show the same level of decline. Over the past two years, retail sales are showing 4-5% annual growth, significantly outperforming the national average.

                The housing market is showing signs of life again, although Kleckley did not see a quick recovery, “I don’t think that what you’re going to expect is something in line with the real boom that you had,” Dr. Kleckley said. “I think it’s very unlikely that you’re going to get back to the real high levels (of growth) that you had before.”

                He noted that the downturn on the Outer Banks did vary from both the national and state norms. “What you saw when you went through your bubble here, the (housing) downturn started much sooner and it was much more severe, than the rest of the state,” Dr. Kleckley said. “But since just about 2007, it’s been pretty steady in terms of existing home sales. In 2009 it (pricing) really hit bottom at the same time the state did, but the average value starting to recover. Not a whole lot, but recover nonetheless. North Carolina went up and then down and now it’s stayed down. It certainly doesn’t help because your levels are low, but you are doing better than the state as a whole.”

                “Existing home sales are recovering, and this trend will continue,” he added. “I think your real estate (recovery) is going to be something more in line with what you had before the boom.” 

                  Reviewing the data he compiled on the Outer Banks, Dr. Kleckley predicted a good season now and into the near future. “Things will start growing again. There will be a sustained level of growth from year to year,” he said. “The tourists will still come. But their patterns will remain conservative. Maybe they won’t go out to eat as much as they did before.”

     Since that time, occupancy has shown very strong growth, and 2011 looks to be the best year the Outer Banks has ever witnessed. Vanessa Riddick, Property Manager for Resort Realty, sees the trend first hand. “While we normally keep our overall occupancy proprietary, we can state that we are 10% ahead compared to 2010,” she says.

     It is not just the peak season, though, that is contributing to the growth in occupancy. “We are seeing a positive trend in occupancy during the shoulder seasons,” Riddick reports. “Fall is one of the best times to vacation on the OBX and each year more and more people take advantage of this.”

     What does this mean for the homeowner?

     Perhaps most importantly, it means a reasonable expectation of rental income. It also means, however, that the market is becoming increasingly competitive, and the most Outer Banks Rentals at the best prices are going to go to the homes that are the most attractive to vacationers.

     What are a few things can make a home stand out?  Eye appeal is important, have some sort of interactive map of the home so people know what they are getting, price the property according to property management guidelines. Pricing may be one of the most important things a property owner can do. 

     A property that is priced to high will not rent as quickly as similar properties priced correctly. To fill the vacancy, there is a good possibility that discounts will have to be taken and owner may not even get the recommended price. 

     The bottom line is, if that property was purchased for rental income, it is a business and must be treated as such–investments must be made, it must be maintained and effective marketing is essential.

     Keep in mind, that like any investment, the better return on the dollar the owner can show, the more value it will have. That becomes particularly important if or when an owner chooses to sell the property. “All things equal, the good rentals will . . . bring a quicker sale and a better price,” Linda Powers, of the Resort Realty Powers Team, says.

Nonetheless, there are some times that are better than others, and this is one of them for Outer Banks Real Estate.

There are a number of factors that have come together to create a buyers market that may never be seen again.  Market pressures continue to force sellers to keep prices competitive, there are a number of Outer Banks bank-owned properties and short sales still in the pipeline that will continue to influence how aggressive a seller can be, mortgage rates are at very favorable levels, sales have picked up over the past year, but there is still a tremendous backlog of unsold properties.

Which paints a great picture if you’re in a position to buy.

The wild card in this, though, is that the Outer Banks is a vacation market, and almost every home that is purchased, is for either investment or rental–very often both.  And the Outer Banks vacation rentals market has remained remarkably consistent and strong. In fact, at a time when the overall Outer Banks average housing sale price fell by 26.5%, the number of people visiting the Dare County grew by 15%.  Currituck County visitation figures, although not yet available, have closely paralleled its neighbor to the south.

Those occupancy numbers are reflected in the stability of the Oceanside market overall.  With the exception of Corolla (where the average sale price of over $1,000,000 in 2006 was probably not sustainable), every Oceanside real estate market has either shown negligible declines or has actually increased slightly in average sale price.

Not every vacationer stays on the oceanfront, of course.  The area between the highways (the Beach Road and Bypass) actually house more visitors than the oceanfront, and the average home prices in those areas is very attractive right now.

For buyers looking for a home that will be used primarily as a vacation home for the family, take a good look at properties on the west side of the Bypass. Primarily residential in nature, some of these properties offer spectacular vistas of the sounds.  Prices in these areas are very reasonable right now, and westside properties are largely isolated from the hustle and bustle of the Oceanside business districts. 

So . . . is it a good time to buy? Yes, it certainly is.  A little bit confusing–the Outer Banks Real Estate market has segmented as it never has before, which is why the Real Estate professionals at Resort Realty are so important in helping you make your decision.  But it really is a good time to buy.

Constructed of woods shipped from inland farms, such as cedar and juniper, they were simple in design, easy to build, never painted and have withstood everything mother nature has ever thrown at them. The homes were designed to take advantage of the glorious ocean breezes and many still lack air conditioning to this day.

It was in these homes that family traditions grew and a unique community took root–whole families, with their servants in  tow, came summer after summer to escape the stifling heat of the  coastal plain. 

Resort Realty Sales Broker, Brimage Silver, is part of that tradition, her Great Great Grandfather, Captain Edward R. Outlaw, built the Outlaw Cottage in 1885, with wood cut on the family farm in Bertie County. Tales of times past are still a part of her life. “My grandmother told me she had to put up black out curtains during the war (WWII)” she says. “So the German U-boats wouldn’t know where the shore was.”

“There is an ambiance to this area, to the families who live here,” she goes on to say. “We’re friends…we’re family. We have cocktail parties on our porches all summer long, and even have a 4th of July parade down the beach road each year.”

Brim just sold a historic oceanfront estate that was not listed for sale, but she perservered on behalf of her clients and made their Outer Banks dreams come true.  Not every property she shows, of course, will be or can be part of the historic homes of the town.

Her current listing, a Nags Head Oceanfront home, is in the heart of the historic district,  although it was built in the 1990s. Nonetheless, the house boasts many of the characteristics of the original houses. The wide wrap around porch invites easy lounging on a lazy summer evening or is ideal for entertaining. “It can weather many a storm or cocktail party!” Brim says.

All four bedrooms offer ocean views, although the panorama from the master bedroom is truly something special. “The view from the master suite is absolutely stunning,” is how Brim describes it.

Still retaining much of the original dune line created in the 1930s, one of the nicest features of the historic homes of this Nags Head Vacation home 

Listing Courtesy of Brim Silver

is the unspoiled feel to the beach. The beach itself is public property, but there’s no beach access in sight in either direction.  “It’s all your friends and family sitting out there.”

The rental projections for the property are eye-opening. “Up to  $60,000,” Brim observes. Yet as important as that is, it is not the only feature that she feels families should know about. “You’re getting a lifestyle,” she says. “A true oceanfront neighborhood, unlike anywhere else on the Outer Banks…this is truly a rare opportunity to own a young home in our historic district.”

Why Use a Rental Manager?

We occasionally hear homeowners ask about the tradeoffs between self-management and management services.  Obviously managers cost money.  Do managers earn it?  Are they cost effective?  This month, we share our answers to the question, “Why use a manager?”

RBOs Don’t Save Money.   They “earn” it, doing some of American’s dirtiest work.  The challenge is not just finding renters, but “fixing, cleaning, and taking care of the screaming guests:” Typical examples:

• Responding promptly to emails by impatient renters who are quick to look elsewhere;
• Answering 10 inquiries for every booking;
• Negotiating rent with bargain shopping renters;
• Responding to renters who argue that a malfunctioning hot tub justifies a full refund;
• Finding a back up cleaner when the regular cleaner doesn’t show up;
• Dealing with lost keys at 2 in the morning;
• Finding a vendor to remove unexpected snow that is blocking access to the home;
• Getting prompt response by an a/c repairman in the middle of summer.

Unplanned Problems.  Are problems rare?  Work-order statistics commonly reveal as many major problems per home as rentals!  Managers are experts in the problems that routinely arise in putting a non-resident renter into a home owned by a non-resident.  We anticipate and avoid recurring problems through preventive maintenance.  We put together networks of service vendors who respond to us faster than they would respond to an individual homeowner because we send them so much business.  We can keep backup cleaners on call because we have enough homes to keep them busy.  Our cleaners serve as our eyes and ears for homes they don’t actually clean, helping us keep properties safe from unruly or unauthorized renters.

Liability.  Many rent-by-owners expose their net worth by failing to inform their insurance companies that they are renting their vacation homes without using a professional manager.

Managers minimize homeowner’s liability by using:

• Bonded workers; and
• Workers covered by workers’ comp;

We use a professional laundry (do you know how many pathogens survive a household washer)?

Credit Cards.  We can take credit cards, assuring more rentals.  This is a credit card society where most renters want to either defer payments or earn miles by paying with credit cards–individuals can’t take cards and PayPal or third-party services are only partial solutions.

Tax.  No one enjoys dealing with the tax man.  It is not uncommon for RBOs to not charge tax.  This may appeal to renters.  But local tax authorities are mobilizing and starting to access homeowner’s Federal Tax returns (through PACE agreements) to identify homeowners who have reported the expenses associated with their rental homes.  Managers relieve the homeowner of tax collection, tax reporting and, of course, interest, penalties and criminal penalties.

Refunds.  We also earn our keep by relieving homeowners of the infrequent but inevitable nightmares– where heat or air systems break and the renter won’t remain in the home, or where weather prevents renters from getting to the home and they want their money back.  RBO sites sell travel insurance, but usually not in a way that prevents uninsured renters from demanding a refund from the homeowner.

Slave to Phone and Computer.  Most importantly, there is the question of bookings.  RBO sites make it easier for owners to market their own properties, at least for homeowners who are willing to chain themselves to their phones and computers.  Aggressive RBOs can generate as many bookings as a manager.  But most RBOs lack the time or energy to respond promptly to the many non-booking inquiries.  And you only need to look at the leading RBO sites to appreciate the challenge of maintaining availability calendars.

Discounting.  RBO sites attract bargain shoppers.   We have a larger pool of renters who are more interested in getting the home they want than in getting a bargain.  RBO site renters often send multiple email requests soliciting discounts.  We monitor the booking pattern of an rental program to determine whether we need to give discounts.  We have a good sense of when to discount and by how much.

To summarize, management is not a fun or stress-free job.  Self-management can work for a homeowner who is both motivated and willing to do a lot of work.  Some who self-manage know what they are getting into.  Others don’t yet appreciate how much stress is involved.  We are equipped to do the heavy work for homeowners.  We make vacation rental home ownership a more pleasant experience. Most of our homeowners prefer to hire us for that purpose whenever finances permit.

Recently Resort Realty’s CEO, Mike Harrington, was interviewed about what sets his company apart.  The Outer Banks Vacation Rentals and Outer Banks Real Estate markets are extremely competitive.  See Mike’s view of where he feels Resort Realty stands today.

Historically, the heavy reservation season for Outer Banks Vacation Rentals has been over the winter (December, January, and February).  While this is still true today, the booking window continues to shrink as supply outpaces demand.  So far for 2010 we are seeing a much better call volume and heavier daily reservation count compared to 2009.  While overall reservations where not off by much in 2009, the later than usual booking window caused rampant discounting and a reduction in overall rental revenues. 

We see the later booking trend to continue into the forseeable future.  In today’s internet age it makes comparison shopping between companies extremely easy, thus making a large segment of Outer Banks Vacation Rentals extremely price senstive.  The good news is that the Outer Banks continues to be a top destination for a huge part of the U.S. population and continues to attract first time visitors on a yearly basis which increases the awareness and popularity of our area.

As of January overall weekly reservations and rental revenues are up compared to 2009, but still off 2008 numbers.  Daily reservation counts are continuing to increase throughout the month and prime weeks (July and August) are renting earlier.   Stay tuned for Resort Realty’s continued market updates on 2010’s Outer Banks Vacation Rental market.

SPACE:

Outer Banks vacation rentals come in all shapes and sizes, but travelers will never compromise on space. They often provide from 1,050 to more than 4,000 sq. ft. of vacation space, providing multiple bedrooms and bathrooms underneath one roof that often cost less than even a single hotel room. For example, rates for some three-bedroom vacation homes start at just $99 per night, but sleep up to eight guests versus just one or two.

DINING: 

Equipped with full kitchens and dining areas, with some providing outdoor grills and patios, vacation rentals provide the option to prepare and store meals and snacks at a fraction of normal dining costs. Ultimately, this saves travelers from paying for a full restaurant meal three times a day, additionally saving on the average traveler’s daily caloric intake.

ENTERTAINMENT: 

When staying in a vacation rental, not every day requires an outlay of cash to fill an itinerary with entertaining activities. Most vacation rentals include enjoyable amenities not found in the highest quality resort, most of which included in the price of a nightly rental reservation. For example, some vacation rentals include a private, screened-in pool and spa, arcade and/or billiard room, in-home movie theater, fireplace, computers, multiple televisions with DVD players and game stations, as well as free movies and video games. Some are also in communities that provide free access to fitness centers, hiking trails, parks, beaches and more.

ACTIVITIES:

Because most professional vacation rental companies have relationships with operators of their local activity providers, attractions, shops and restaurants, they can exclusively offer discounts, coupons, ticket upgrades and, in some cases, free admission.

RENTAL RATES:

If travelers are members of AAA, AARP and other organizations, have served in the military, are repeat guests, are booking at the last minute, traveling with a large group or more, there are guest appreciation offers to be found across North America. You can also find themed specials and packages throughout the travel year, and traveling during low season can save guests a substantial amount. Guests should also inquire about EZ Pay Vacation Plans, which allow travelers to select an installment-based payment plan now to secure their future vacation.

STAYING CONNECTED:

While most hotels charge guests for daily high speed Internet access and local telephone calls, many Resort Realty homes offer such services at no charge.

AIRLINE BAGGAGE FEES:

Resort Realty vacation rentals come equipped with in-home washers and dryers, allowing guests to pack less clothing and toiletries, avoiding airlines’ pricey checked baggage fees.

INSURANCE:

When choosing a vacation rental from an established property management company like Resort Realty, travelers can be assured that there’s a reputable business maintaining and servicing the property and its guests each day. Beyond this assurance, peace of mind is easily attainable with affordable travel insurance options, which are provided by many vacation rental managers through companies familiar with the category like CSA Travel Protection. Trip insurance is often only about five to seven percent of the trip’s cost. For example, a $5,000 trip would cost roughly $250 to $350 to insure, according to the Insurance Information Institute.

EXTENDED STAYS:

Resort Realty offers their guest many homes that only require a 3 night stay, but travelers will often find added value when extending their stay, whether just one or a few extra nights.  Occasionally Resort Realty homes will offer “free night” specials and other added benefits to help guests save on an extended vacation, sometimes providing more incentives for stays from three to seven nights.

TRANSPORTATION:

Other relationships that travelers can reap the benefits of are those made between vacation rental companies and transportation providers, whether it’s car rentals, shuttle services, golf carts, bicycles or more.  Resort Realty can arrange rental car and bicycle rentals through its partnership with the area equipment rental companies. 

Beyond saving travelers money, vacation rentals provide lasting values through enduring “togethering” experiences with family and friends that are often considered to be priceless.

covered park grill

Ready for five more tips that will help you stand out in 2010?  In our last post we discussed five easy ways you could improve your chances of repeat renters and overall occupancy.  These things, while not difficult to do, are often overlooked in the big picture.  If you have ever had to sit down with a disgruntled renter, then you will know that it is the LITTLE things that really count.

 Here are another five things that can help you stand out from the Outer Banks Vacation Rental crowd:

 1)      Painted Walls – You might be saying to yourself, What?  When I say “painted walls” I mean with a color.  Think about it, people are on vacation at the beach.  When you think of the beach what comes to mind?  For me it’s blue oceans and skies, sand, and swaying sea oats.  Incorporate some color in your home on the walls, even if it is one accent wall.  If you need help choosing a painter, check out Beach Painting Contractors.

2)      Good Mattresses – I don’t know how many times I have heard that the “house was great, but the beds were horrible”.  What do you love about hotels?  I bet one thing is the unbelievably comfortable beds some provide.  If you mattresses have seen there better days, then please consider investing in new ones.  You can find pretty good deals if you know where to look.  Check out Outer Banks Furniture, they just opened a new mattresses store. 

3)      A Thank You Gift – This does not mean you have to buy a $100 gift basket for every guest.  We had one owner that used to print t-shirts with the house logo and the year on them, and would ask us to hand give them to the guests for every stay.  If you buy these in bulk, it can be pretty cheap, and an awesome way to build your home’s brand.  Check out Flying Fish Screen Printing for some ideas!

4)      A Quality Grill – This is one of the more frustrating aspects of being a homeowner in a beach community.  Everyone wants to grill out while on vacation, but our environment is terrible on Grills.  There are only two options in my book.  Buy a inexpensive (not “cheap”) gas grill and plan on replacing it every year, or a COVERED park style grill and install it in an area with ample room to set up tables and chairs.  These types of grills can last 3 to 4 years or longer.  Do not, I repeat, do not buy the UNCOVERED park grills, they are disgusting.  Here’s an example of a Covered Park Grill.

5)      Ceiling Fans – This, again, is not a big deal, but you would be surprised how many homes do not have ceiling fans in the bedrooms and living areas.  People love the Ocean Breezes, but hate the humidity.  While this may be a non-factor for some guests, I’ll bet it would make a difference if they weren’t there!  Home Depot usually has a good variety.