Inhaven's Guide to Short-Term Rental Terminology

Inhaven's Guide to Short-Term Rental Terminology

Navigating the vacation rental industry can be complex, especially with the extensive use of specific terms and acronyms. At Inhaven, we equip property managers with premium products and in-depth knowledge to maximize their operational efficiency and confidence. This glossary is designed to clarify essential short-term rental (STR) concepts, enhancing your proficiency and ensuring you can confidently manage and communicate the intricacies of your properties to facilitate superior guest experiences.

General Terms

  • Active Listing: A property is considered an active listing if it has at least one booking during a given period of time. For example, a property with one booking in the last six months would be considered an active listing.

  • Arbitrage: Rental arbitrage is the process of securing a rental property for a long-term period, and then listing it as a short-term rental.

  • Blocked Days/Nights: These are dates when the property is not available to book, often because it is being used for personal reasons or maintenance.

  • Booked Days/Nights: These are the days or nights that a guest has paid to stay at the property.

  • Booking: Reservation

  • Booking Lead Time: This is the period of time between when a guest books a reservation and when they actually check in.

  • Cap Rate (Capitalization Rate): This measures the return on an investment property. It is calculated by dividing the net income by the property's market value.

  • OTA: Online Travel Agency

Market Analysis

  • ADR (Average Daily Rate): This refers to the average revenue a property earns per day.

  • Occupancy Rate: The ratio of booked days to available days.

  • PAR: Per Available Room

  • RevPAR (Revenue Per Available Room): For all intents and purposes, this term represents your revenue. To calculate RevPAR, you divide your annual revenue by the amount of nights you have available for your listings.

  • Seasonality: This refers to changes in booking demand as it correlates to time of year and location. For example, beachfront properties often get more bookings in the summer.

  • Shoulder Season: This is the period of time between peak and off-peak seasons. It varies by destination and is important for optimizing promotions or pricing strategies to help boost occupancy during less busy times.

Platforms and Listings

  • Airbnb: Airbnb is an online travel agency or OTA. It’s as synonymous with short term rentals as Kleenex is to tissues.

  • Dual-listing: Listing the same property on multiple platforms (e.g., Airbnb and Vrbo).

  • HomeAway: A vacation rental platform that consolidated with Vrbo in 2020.

  • Vrbo: Another major OTA for vacation rentals.

Pricing and Revenue

  • Daily Rate/Nightly Rate: Daily or nightly rates denote the cost per night for accommodations, which can be subject to changes based on seasonality.

  • Dynamic Pricing/Smart Rates™: Pricing strategies that adjust rates based on real-time market data to optimize revenue.

  • GBV: Gross Book Value

  • Yield: Represents the income return from a property, calculated as a percentage of the property’s value.

Regulations and Management

  • HOA: Home Owners Association

  • Ops: Operations

  • PM: Property Manager

  • PMS (Property Management System): Software that automates the management of real estate properties.

  • Regulations: The laws and guidelines governing the operation of STRs. These can vary significantly by region.

  • VRM (Vacation Rental Manager): A person or company that manages vacation rentals for property owners.

  • VRMA: Vacation Rental Management Association

Operational Terms

  • FF&E (Furniture, Fixtures & Equipment): The movable furnishing included in a property. Unlike structural components, these items are non-permanent and can be removed.

  • OS&E (Operating Supplies and Equipment): Essential tools and goods needed for the property’s operation, such as linens, dishes, and small appliances.

  • Turn: The process of cleaning and preparing the property between guest stays.

Textile and Fabric Terms

  • Cotton: Varieties such as Egyptian, Pima, Upland, and Organic cotton differ in texture and quality, affecting their preferred applications in clothing and linens.

  • Cotton/Poly Blend: A fabric combining cotton and polyester fibers, typically in a 65/35 ratio, offering the comfort of cotton with the durability of polyester.

  • Color Hemstitch: An ornamental technique used on the hems of fabric items like sheets and towels, involving decorative stitching that sometimes features contrasting thread colors.

  • GSM: Grams per square meter

  • Microfiber: Fabrics made from extremely fine fibers of polyester. They are lightweight, resist wrinkling, and have a soft hand. Microfiber is excellent for allergy sufferers as it repels allergens and dust mites.

  • Pounds Per Dozen (PPD): "Pounds per dozen" is a measurement that indicates the grams per square meter of a dozen towels. It helps to distinguish between towels of different density and absorbency.

  • Terry: Usually this term refers to bath towels characterized by their looped pile, which is highly absorbent.

  • Thread Count: Thread count refers to the number of threads in one square inch of fabric, combining both warp (lengthwise) and weft (widthwise) threads. For instance, if a cotton sheet has 100 warp threads and 100 weft threads per square inch, it has a thread count of 200. Generally, a higher thread count indicates a fabric that is softer and more durable.

Using This Guide

Whether you’re a new host or looking to refine your management strategy, these terms provide a foundational understanding essential for navigating the short term rental landscape. At Inhaven, our experts aim to achieve the highest standards of guest satisfaction. This guide can help you learn necessary rental terms. This knowledge will help you manage and expand your vacation rental business.

Stay informed, stay empowered and, most importantly, create extraordinary travel experiences with Inhaven. For more insights and resources, visit Inhaven’s In The Know Blog.