@Nathan92I do exactly this - we are an agency, managing a lot of holiday homes for the owners.
One golden rule - keep it simple or you will give yourself a lot of headaches.
We have a standard contract for property management and lettings management for every property. We work on a fixed commission rate plus a cleaning / changeover fee.
All properties are rented in our name / account. All payments come to us, regardless of which OTA the booking is on or if guests book directly with us (via website / social media etc). We deduct our %, deduct the cleaning fee, deduct any other costs, transfer the balance to the owner. Once a month, we send the owners a statement listing every booking, fees, payouts.
Our % fee is based on the nightly rate - it does not include any service fees / booking fees that an OTA might charge. We decide the nightly rates - this allows us to reduce prices as necessary to try and fill properties. If we set £100 per night on AirBnB, the guest might also pay £75 service charge - our fees are only on that £100 per night. AirBnB also charge a % of the nightly fee - for us, it is 3.6%, including UK VAT. So for one night, the payout to us would be £96.40.
As a basic example, assume £100 per night, 15% commission, £50 changeover fee (these figures are simple to work with). Assume a 4 night booking. So .....
(4x£100) - (AirBnB fee @ 3.6% = £14.40) - (your commission @ 15% = £60) - (cleaning fee £50) = (payout to owner = £275.60)
Our commission fee includes "property management". We do minor (zero cost) repairs without any additional fee to the owner - this will be things like adjusting a cupboard door or replacing a door handle. It also includes the time spent replacing items - so if a toaster breaks, we buy a new toaster, deliver it to the property - we charge the owner for the toaster, but not for the time spent buying and delivering it. (We live close to all the properties, we're often out and about anyway, often visiting a nearby property etc, so not a hassle or problem). For replacements etc, anything up to say £20, we just do it and charge the owner. If it's something bigger, like a washing machine, we discuss with the owner. We can still go and get one and install it and charge the owner, but the owner must agree with the price and the item. For bigger repairs, we can call tradesmen out - of course, this must be agreed with the owner.
Little things like lightbulbs and batteries are included in our fees. They don't need replacing often, and accounting for all the little things like this individually would take more time than they're worth.
We have our own team of cleaners. Changeover fees will vary according to each property - a 3 bedroom property obviously takes more time and work than a 2 bedroom property. Our changeover cleaning fee includes the laundry, all the sundries like toilet rolls, hand soaps etc. It's a fixed price per changeover, regardless of whether it's 1 person or 6 people staying (most of our bookings through the year will be couples only). Owners will normally provide their own bedding, mattress protectors, pillow protectors etc, but we can supply if needed (linen hire is extra cost per changeover). Of course, if guests sit in bed eating curry and wiping their fingers all over the bedding (as happens here sometimes), bedding may not come clean on the first wash, so we may need to supply our own bedding for some properties sometimes - we don't charge for that.
I prefer to use our own bath mats, tea towels, hand towels etc - we have so many of them it just makes it easier to replace when a guest cleans the floor with a hand towel or something.
As for the actual cashflow ... we pay all owners for each rental, normally within 7 days of the guest arriving. Payment is by BACS bank transfer - we deduct fees as above and transfer the balance. AirBnB normally pay us the day after a guest arrives. TripAdvisor normally pay us within a week of the guest arriving. Booking.com can hold payment until the middle of the following month - there is an option for payment 4x per month, but extra fees apply. It doesn't matter to us when we get paid, we still pay out to owners within 7 days.
Of course, we often pay out a lot of money before we actually receive it, especially as Booking.com brings about 40% of all of our bookings. That's not a problem to us, but could be a problem to newer businesses. You might prefer to adjust your payout policy to pay out to owners after you receive the money, or pay out once a month. It's your choice.
Something worth considering is how you manage listings to help with the cash flow. If you get 10 reviews for one property on TripAdvisor, the majority of bookings for that property can come from TripAdvisor, so you get the cash in your bank account sooner. For some properties, we open on AirBnB, HomeAway and TripAdvisor further in advance than on Booking.com, to increase the chances of bookings coming in from OTAs that pay out faster.
Hope all this helps. PM me if you want. Let me know how you get on!
