Starting a successful rental business takes much more than having a property and creating an Airbnb listing. You need to market your rental, ensure stable occupancy, manage finances, and handle dozens of other routine tasks. If you want to avoid getting too involved in launching and managing short-term rentals, a vacation rental franchise is one option to consider.
Franchising allows you to tap into property management resources, technologies, marketing channels, and customer bases of an established rental provider. You also get support with physical maintenance of the property and communicating with guests. You just need to follow their guidelines and pay the upfront fee plus ongoing royalties.
What is a Vacation Rental Franchise?
A vacation rental franchise is a business model where you (the franchisee) buy the rights to operate under an established company’s brand and use their resources. In exchange for an upfront fee and ongoing royalties, you get to use their company name, trademarks, business systems, and resources. The franchise helps you enter the market with minimal risk and limited experience.
What You Get With a Franchise
- Operation under a recognized brand
- Access to multi-channel marketing resources
- Training on property management, customer service, and compliance
- Ongoing support and expert advice
- Property management software and other tools
- Standardized cleaning and maintenance processes
- Guest communication templates
- 24/7 support systems
- Effective revenue model
- Help with property damage protection and policies
Your Own Business vs. Vacation Rental Franchise
Choosing between starting vacation rentals on your own and using third-party resources is a common dilemma for beginners. When you manage a rental business yourself, you avoid extra costs and can achieve higher margins. You gain more flexibility and can decide how to scale the Airbnb business without any restrictions. You can start small by launching one Airbnb property and managing it manually, even with a limited budget. On the other hand, owning a business means you face many managerial, legal, and marketing challenges that you’ll have to handle all by yourself.
A vacation rental franchise offers more peace of mind and an easier start. You’re less likely to fail thanks to operating under a well-known brand and getting professional support. Expenses and revenue are also more predictable. At the same time, franchising requires a higher upfront investment and commitment to follow strict brand guidelines. Your potential income may be lower than what a successful, solely owned business generates.
The table below breaks down the key differences to help you decide which path makes more sense for your situation:
Your Own Business vs. Vacation Rental Franchise
| Own Business | Vacation Rental Franchise | |
|---|---|---|
| Startup Costs | Flexible — can start small | Higher initial investment |
| Recognition | Building your own brand from scratch | Operation under a well-known brand |
| Marketing | DIY website, SEO, social media, and listings | Access to third-party marketing resources |
| Technology | Individual subscription to selected tools | Access to franchisor’s tech stack |
| Training and support | Self-taught; trial & error | Onboarding, manuals, training, and ongoing support |
| Flexibility | Full freedom to shape guest experience, cleaning standards, and pricing strategy | Must follow brand standards; less flexibility |
| Revenue Model | 100% of profits | Ongoing royalties (typically 5–10% of gross revenue) |
| Exit Strategy | Brand & customer base ownership; can sell as your own company | Selling may depend on franchisor approval, since they own the brand |
Who Should Consider Using a Franchise?
Based on the comparison above, certain situations make you more likely to benefit from operating under a franchise. Having little experience with vacation rentals, limited time to establish your own business, or needing ongoing support are some key factors. Here are the main categories of property owners and managers who should consider joining a vacation rental franchise:
- Beginners in the property rental business. If you have no experience with vacation rentals, gaining it under someone’s guidance can save you from failures and ensure a stable income.
- Real estate professionals who want to launch short-term rentals. Realtors and long-term rental managers entering the vacation rentals niche can do it more smoothly using a franchise.
- Investors interested in this business model. Franchising is a common solution for investors who have the budget but don’t want to engage too deeply in property management.
- Hosts who enter highly competitive markets. Operating under a well-known brand helps attract guests in markets with multiple vacation properties and fierce competition.
- People who prefer low-risk investments and seek support. Property owners or managers who aren’t ready to handle everything on their own can consider franchising as a way to share responsibilities.
Franchising works well for people who want to make rentals easier and are ready to pay for that convenience. This business model provides powerful support, but it also comes with extra charges.
Now that you know who benefits most from franchises, let’s look at the specific advantages and challenges you should weigh in your decision.
Pros and Cons of Using a Vacation Rental Franchise
Franchising is one of many business models, not a universal solution. It makes launching rentals more straightforward, but also implies many limitations. Consider these advantages and challenges to decide whether this approach is right for you.
Reasons to join a vacation rental franchise:
- Easier market entry and property management. Working with an established company gives you access to a rental model that’s already proven successful in your market. You get significant help with pricing and achieving stable occupancy.
- No need to have a team. The franchisor provides you with a local maintenance team to take care of your rental properties.
- Access to property management software. You get access to PMS, guest verification systems, and other solutions that streamline rentals.
- Operating under a well-known brand with an established customer base. Established rental companies have loyal customers who trust their services, making them more likely to book a property under the franchise.
- Reduced risk of mistakes and more predictability. With franchising, you always have someone to ask for advice and get access to standardized operations that make rental management efficient.
- Easier regulatory compliance. The franchisor assists you with getting permits and informs about any Airbnb limitations that apply in the area.
- Powerful market analytics. Since the franchisor is no less interested in making properties profitable and has been working in the niche for a while, they have realistic market data to make informed recommendations about your rental units.
Challenges related to franchising:
- Higher initial budget. The franchisor charges a substantial upfront fee for the rights to use their expertise and brand, which increases the cost of launching a rental business by dozens of thousands.
- Increased costs. There are obvious expenses, such as an initial payment and royalties, but you may also need to pay marketing fees.
- Multiple obligations to follow. You’ll need to meet the terms of the agreement, including the use of the franchisor’s systems, brand standards, guest service level, reporting, and franchise renewal and termination rules.
- No personal brand development. By operating under a franchise, you contribute to the development of the third party’s brand, not your own. People are often unaware that you’re a separate unit.
- Leaving the franchise may be turbulent. You may have to use the franchise for a specified number of years or pay penalties and lose the initial investment, along with access to the booking platforms, marketing channels, and brand name.
With these pros and cons in mind, let’s look at some of the top franchise options available in the market today.
Top Vacation Rental Franchise Options
The best vacation rental operators vary by location. There are dozens of options in each area, each with unique rules and investment requirements. Here are the most well-known STR franchisors operating in the US and EU.
iTrip
iTrip is a US-focused rental company that partners with over 80 national and international listing sites, including Airbnb, Expedia, and Vrbo. They focus on stand-alone properties and promise to start training within 48 hours after you sign a franchise agreement. The initial investment ranges between $55k and $75k, with a 4%-6.1% royalty fee and a $540 software/tech fee.
Direct Booker
Based in Croatia, Direct Booker operates in the EU market with 1550+ partners and 10,000+ managed properties. They offer assistance with online advertisement, revenue management, guest communications, property administration, homeowner interface, and onsite management. A Direct Booker’s franchise allows you to advertise your property on the brand’s main platform. The entrance fee starts from 3000€ (≈$3500), which is much more affordable than the market average. You’ll also pay royalties calculated annually from the gross revenue.
Casago
Casago operates across the US and Mexico, offering a highly tech-based approach to franchising. The company automatically calculates a monthly commission based on statements through exclusive tools. There’s no set price for a franchise, with fees varying by territory and situation. Casago collaborates with both beginner property managers and large companies seeking to use the corporate-level resources. The company has a multi-step franchise launch process and checks whether an applicant is a good cultural fit with the organization.
Pass the Keys
Launched in London, Pass the Keys operates in the UK and Spain. They have 65+ franchise partners with 2,000+ properties managed, and 502,100+ guests hosted. It’s a small team that keeps close relationships with Airbnb and Booking.com. The initial investment to start a property business is £40,000–£50,000 (including working capital), which is around $55,000-$68,000.
Other options for joining a vacation rental franchise include Book by Owner, Happy Holiday Homes, Property Management Inc., and SkyRun Vacation Rentals. We usually recommend collaborating with local companies or those that have a strong presence in your area. They have a better understanding of local demand, regulatory limitations, and optimal pricing and marketing approaches.
Rather than joining an existing franchise, some experienced property managers choose to create their own. This represents a significant step up in responsibility and potential reward.
Starting Your Own Vacation Rental Franchise
Experienced property managers who are ready to help new businesses can launch their own franchise. It allows you to scale and go from side hustle to full-time property management or even build a multinational company.
The launch of a vacation rental franchise is typically the next step for those who have successfully managed multiple properties and want to share their expertise. You have the software systems, standardized property operations, and a reliable maintenance team in place. You also know the demand in your location, and the data shows that the volume of guests will only grow.
Good and Bad About Launching a Rental Franchise
✔ Advantages:
- Scalable growth model
- Increased revenue with multiple recurring streams
- Access to franchisees’ capital
- Additional resources for winning the market
- Stronger brand
✖ Challenges:
- More responsibilities
- High initial fees for compliance and franchise registration
- Significant time investment
- Less direct control
- Brand reputation risks
- Dependence of franchisees’ revenue
Your Responsibilities as a Franchisor
As a franchisor, your responsibilities shift significantly. Now you’re the one who onboards new property managers and supports them through entering the vacation rental market. If you’re considering launching your own franchise, here’s what you’ll need to handle:
- Establish and maintain a business model for a vacation rental franchise.
- Create operations manuals, training guides, and legal agreements.
- Adopt software systems for large-scale property management.
- Design materials for initial training and support franchisees through onboarding.
- Develop and enforce brand standards, including the quality of service and branding.
- Provide ongoing support with property management and bookings.
- Run marketing campaigns across multiple channels.
- Report on KPIs like occupancy, ADR, RevPAR, guest satisfaction scores, and others.
- Market your franchising program and manage the community.
- Collect royalties and manage accounting.
- Assist with local market analytics and licensing.
- Analyze your own business and franchising model efficiency.
Experienced property managers know how to handle most of these operations since they’ve done it for their properties. If you’ve been in the vacation rental industry for a while, you already have the skills to manage multiple rentals at scale. For the rest, you may need to consult with legal and business experts additionally.
Steps to Become a Franchisor Yourself
Launching your own vacation rental franchise is a big move in any property management career. It’s a new scale of vacation rentals that entails more responsibility and requires careful preparations. Here are the main steps to get started:
Step 1. Make sure your business is ready for a franchise
Launch a franchise when you have a proven business model that others can repeat. You’ll need to rely on analytics to ensure your approach is profitable and will work for others. Another crucial factor is your business reputation. It’s better to start when your brand is already well-known, at least in your location. You’ll have more trust from potential investors and a smoother kick-off.
Step 2. Build a scalable franchise system
Think about how you can train others to repeat your success and launch vacation rentals with high profitability and occupancy. You need to establish standardized operations, document every process, and create branding guidelines.
Calculate the investment fee and royalties required to make your franchising model profitable. Consider the ongoing expenses for marketing, software subscriptions, licensing, accounting, and taxes.
Step 3. Draft the franchise disclosure document
Once you decide on the franchising rules and fees, create a franchise disclosure document (FDD). You’ll provide it to prospective franchisees before they sign the final agreement to specify the terms of cooperation. The FDD includes franchisor information, business overview, litigation and bankruptcy history, initial and other fees, franchisee’s obligations, restrictions, territory to do business, trademarks, patents, copyrights, and proprietary information, and other terms.
Step 4. Register your franchise
Register the vacation rental franchise if your local legislation requires it. The rules differ across countries and states, so be sure to consult with a franchise expert.
Step 5. Build a comprehensive system to support others
Prepare initial training materials, connect PMS software, establish damage protection services, and automate routine property management operations to be ready to scale. You’ll need reliable infrastructure before the first franchisees join you. It’s better to test the system beforehand to see how it works, detect any flaws, and eliminate them.
Step 6. Market your offer
Promote your offer to potential franchisees through your website, PPC ads, and social media. Your core target audience includes individuals seeking to start a new business, multiple property owners, existing operators struggling with occupancy, property managers who want to enter new markets, and investors looking for passive income. Finding partners may take time, so be prepared to pitch your product.
Making the Franchise Decision
Vacation rental franchising offers two distinct paths depending on your experience level and goals. If you’re new to short-term rentals or entering a competitive market, joining a franchise gives you proven systems, established brand recognition, and ongoing support — though you’ll pay upfront fees and ongoing royalties for that security. If you’re an experienced property manager with multiple successful rentals, launching your own franchise lets you scale your business and create recurring revenue streams by helping others replicate your success.
Both paths require solid risk management. Whether you’re operating under a franchise brand or building your own, protecting your properties and screening guests consistently matters.
Truvi’s Guest Screening and Damage Protection work across all booking channels and integrate with major property management systems — giving you reliable protection without adding friction to the guest experience. With up to $1M in coverage and a dedicated resolutions team that handles incidents in about 5 business days, you can focus on growing your franchise business instead of chasing down damage payments.
Protect Your Franchise Investment
Whether you’re joining a franchise or starting your own, get comprehensive Guest Screening and Damage Protection to minimize risks and maximize profits.
