Winter Is Bad News For Cape Town Self Catering Owners
Yes. The Cape Town winter is seriously bad news for most Cape Town self catering owners.
We walked the streets of many False Bay villages, and the shops are closed. If it was not for mother's day, restaurants would have had almost no clients. The weather is actually great. A few days of the South Easter and then glorious sunny days. No rain yet. But the visitors are not around.
Those that are walking the streets with pounds in their pockets cannot believe how cheap accommodation is. Camps Bay villas are going for less than R1000 per night per room. During
In False Bay you can get accommodation for less than R500 per room and that's not even helping as most homes are empty.
Owners and fellow agents are asking questions. And I decided to investigate and give you some answers.
I picked a few graphs to show you what winter is doing to the self catering business:
The one below is from Airbnb where they recomend we adjust our rates down to rock bottom as there is no demand.
The next graph shows the number of incidents our manager was involved in over nearly a year.
The number of incidents above shows that most incidents occured during January. Feburary and December were sighlty less than January. This means that there is a lot of 'in and out' during January as people depart after New Years and arrive for the very popular February period. But May until end June is the worst time at about 25% when compared to the highest period.
The next graph shows our Sales Per Month
In order to get a trend I used our highest sales month to compare with the other months. During November 2016 we recorded the highest sales. Again May is bad; you can see that sales during May are less than 25% when compared to the high sales months.
What can be done?
I have always said a stupid marketer can get homes booked during high peak but only the best will get it done during winter. Here are a few practical and not so practical ideas:
- Winter is a good time to visit the Constantia Wine farms. You can drink wine and more wine as you may be the only one there to try and forget about the bad months. Elmarie and I will not be at the wine farms this winter but will be in Sicilly for two weeks while Nandi will keep you all happy.
- I see the local government is making plans trying to reduce the seasonality. This is not an easy one and will benefit central Cape Town before any other area.
- Setting rates: This is the most obvious choice you have. Your rates must be less than your neigbours with the same home as yours. If you have an agent, worth their salt, then trust them to get you money during the bad months.
- If you have not bought an investment property you intend to use for self catering rentals then beware: The further you move away from Camps Bay and the CBD the more your demand/rates will suffer. The greater CBD area is very popular through the year. The Atlantic Seaboard demand is such a premium that it's the place to buy if you can afford it.
Other than having very competitive rates I don't really have any clever advice if you want to at least break even during the bad months. Most self catering owners compete during winter on rates only.
In a recent post I mentioned how critically important independent guest ratings are for your home on various sites. If you trully want to beat the winter blues you will have to invest in competitive rates to buy guests to rate you. "Buying" is not bribing them it's you paying with low rates to ensure you get ratings. After 40 ratings good things regarding occupancy kicks in. And only after 250 ratings will the real magic kick in. Read more here...
Thanks for reading.
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Johan part of the Horak Clan at CapeHolidays.info
P.S. We are not the biggest self catering agency. We are not even trying to be. All we try is to be the best.
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