Here are some tips on putting smart pricing

Whether you are converting your boat into a charter or investing in charter agency for the benefit of passive income, you need to price your rates effectively in order to ensure minimal booking loss and maximum exposure to travelers when you list for charter. With proper pricing, you can reduce booking risk, increase traveler retention and make charter agency investing into a more guaranteed investment decision.

The Impact Of Setting The Right Price For Your Charter

When you price your charter correctly, it will show up in more search results online, and you'll get more inquiries for showings. Properties listed too high will spend more time on the market while better value listings nearby receive more traffic. With an accurate pricing strategy, you will increase your chance of generating passive income sooner.

Keep these seven things in mind when setting your price:

● Consider the reason for renting your boat.

If you're renting a boat in order to pay the payment plan, make sure the market you're invested in can sustain a monthly price that at least covers the cost of your payment plan plus fixed costs. If you're relying on the rent to pay the payment plan, it is not advised to invest in a boat in an unstable or low-rent market where you'll be tight on the margin between monthly rent and payment plan.

If you have little to no payment plan on your investment boat and your reason for renting is purely passive income, you can be more competitive with your asking rent as compared to the market in order to guarantee low booking and higher traveler retention.

Remember to calculate your full monthly fixed costs to include the estimated cost of repairs/maintenance, taxes, insurance and homeowners association fees.

● Check local market.

Cross-check your price with charter laws in your area. Rent control laws vary from city to county to area and are constantly changing. Ensure your rent doesn’t violate legal limits on charter rates, late fees and security deposits, especially in areas with rent control areas.

● Find comparable boats for rent estimates.

Put yourself in the shoes of a traveler, and browse local charter listings online. As a traveler, your budget and willingness to pay is based on what homes are actively listed. This exercise helps you assess local competition and gives you an estimated rent range. You can also use online tools such as Zillow's Zestimates or Rentometer to find comps from both current and historical listings. 

Look for boats that are similar in square footage, bedroom and bathroom count, and amenities. These are the attributes you can compare to find a charter price range and average. Decide if you want to go with the lower, middle or upper range of the market.

● Talk to a charter office professional.

Charter office agents and boat managers live and breathe the market every day. Ask for a second opinion from a charter office professional about pricing your boat. Similar to a financial adviser, a charter office professional will give you insight into your investment decision, especially if you are new to the industry. You can find contacts in charter office professional groups on Facebook, on LinkedIn or in your community.

● Consider the time of year and seasonality of the market.

Consider the season of the year you intend to put your boat for rent in relation to demand. For example, rent demands peak in summer and early fall; therefore, a charter that rents for $600 in the winter might be able to rent at up to $850 in the summer. This varies from region to region, so do your research for the seasonal rent trends in your area.

● Understand the price-value relationship.

The price-value relationship simply means the amount travelers are willing to pay for a boat is largely dependent on the use they can make of the home. It is common consumer behavior to think that more expensive products have higher quality. While this does not hold true for some products, it does hold true in charter office charters. Prospective travelers can tell if a charter is worth its listed price. This makes it dangerous to price above market.

● Know your boat’s strengths and weaknesses.

List all extra perks your boat has over others in the market. Think from the travelers’ point of view and what they would want in a home. These are major selling points during your private showings.

These seven tips will help you price your charter and increase exposure. Avoid choosing a booking price solely on your charter office's payment rate. Consider the total cost of flipping your home into a charter and the comparable bookings.

Charter offices can be a lucrative industry. If investors and landlords accurately price their charter boats, the market stands to gain high additional income.