Understanding STR Economics: Revenue vs. Costs

Revenue Expectations in Point Roberts

Let's start with the question every owner asks: how much can I make? The honest answer is: it depends. Revenue is driven by a combination of factors — property size, condition, location within Point Roberts, amenities, pricing strategy, and how well the property is managed and marketed.

That said, here are realistic annual gross revenue ranges for typical Point Roberts properties with professional management and dynamic pricing:

• 1-bedroom / studio: $18,000–$28,000/year
• 2-bedroom home: $28,000–$42,000/year
• 3-bedroom home: $35,000–$55,000/year
• 4+ bedroom / premium waterfront: $50,000–$80,000+/year

Operating Cost Breakdown

Understanding your costs is just as important as projecting your revenue. Here's where the money goes for a typical 3-bedroom Point Roberts STR generating $45,000 in gross annual revenue:

1. 1Platform fees (Airbnb/VRBO host fees): ~3% of gross revenue = ~$1,350/year. These are deducted by the platform before payout.
2. 2Management fee (20–25% of gross): $9,000–$11,250/year. This covers pricing optimization, guest communication, booking management, vendor coordination, and financial reporting.
3. 3Cleaning costs: $4,000–$6,000/year. Varies with turnover frequency — more bookings means more cleanings. Typical cost is $120–$200 per turnover depending on property size.
4. 4Maintenance & repairs: $2,000–$4,000/year. Budget for both routine maintenance (HVAC filters, gutter cleaning, minor fixes) and unexpected repairs (appliance failure, plumbing issues).
5. 5Supplies & consumables: $1,000–$1,500/year. Toiletries, coffee, cleaning supplies, paper products, light bulbs, batteries, and replacement linens.
6. 6Insurance (STR-specific): $1,200–$2,500/year. Standard homeowners insurance does not cover STR activity — a dedicated policy is essential.
7. 7Utilities: Varies widely but expect higher than typical residential use, especially in summer with AC and winter with heating.
8. 8Property taxes: Unchanged by rental activity, but still a real cost of ownership.

For our example property grossing $45,000, total operating expenses (excluding property taxes, mortgage, and utilities) range from approximately $18,000–$26,000 — leaving net owner income of roughly $19,000–$27,000 before taxes and debt service.

The Comparison That Actually Matters

Too many STR analyses compare vacation rental returns to stock market returns or long-term rental yields. That's the wrong comparison for most Point Roberts owners. Here's why:

Most Point Roberts properties are vacation homes — not pure investment properties. You bought them for personal use, family memories, or as a place to escape to. The real question isn't "would this money perform better in an index fund?" The real question is: "would I rather my home generate $20,000–$30,000 per year and be professionally maintained, or sit empty 11 months a year costing me property taxes, insurance, and slow deterioration?"

"The biggest cost of not renting isn't the lost income. It's the deferred maintenance. Homes that sit empty deteriorate — pipes freeze, roofs leak unnoticed, pests move in. A managed rental is a maintained home."

— Alexander Henn, STAY49

• Annual cost of an empty vacation home (taxes, insurance, utilities, maintenance): $8,000–$15,000+
• Annual net income from a managed STR: $18,000–$30,000+
• The swing: $26,000–$45,000 per year — the difference between bleeding money and generating meaningful income
• Bonus: a professionally managed rental is inspected, cleaned, and maintained regularly — your property stays in better condition than if it sat empty

Factors That Drive Higher Returns

Not all Point Roberts properties earn the same returns. Here's what separates high-performing listings from average ones:

1. 1Professional photography: Listings with professional photos earn 20–40% more than listings with amateur photos. This is the single easiest win.
2. 2Dynamic pricing: Owners using dynamic pricing tools earn 10–25% more than owners with static rates. The seasonality of Point Roberts makes this especially impactful.
3. 3Guest experience: Properties with consistently high reviews (4.8+) get boosted by platform algorithms, resulting in more visibility and more bookings. Small touches — welcome snacks, a local guidebook, quality coffee — compound into higher ratings.
4. 4Property condition: Updated kitchens, quality mattresses, and well-maintained outdoor spaces command higher nightly rates. You don't need luxury — you need "better than expected."
5. 5Amenities that matter: Hot tub, water views, pet-friendly, and proximity to the beach are the amenities that most affect booking rates in Point Roberts.
6. 6Operational excellence: Fast response times, clean turnovers, and seamless check-in/checkout reduce cancellations, prevent negative reviews, and drive repeat bookings.

Is Professional Management Worth the Fee?

The management fee (typically 20–25% of gross revenue) is the largest single expense. It's natural to wonder: could I save that money by managing it myself?

The math isn't as simple as "gross revenue minus management fee." Professional management affects both sides of the equation — revenue and costs. Here's what to consider:

• Revenue impact: Professional managers use dynamic pricing, optimized listings, multi-platform distribution, and active review management to maximize bookings and rates. Self-managed properties typically earn 15–30% less in gross revenue.
• Time cost: Self-management requires 10–20+ hours per month during peak season — guest communication, booking management, cleaning coordination, maintenance, pricing updates, and problem-solving. Value your time accordingly.
• Quality consistency: Professional cleaning inspections, preventive maintenance, and standardized guest communication prevent the negative reviews and guest complaints that drag down self-managed listings over time.
• Cross-border factor: For Canadian owners, self-management from across the border adds significant friction — border delays, emergency response limitations, and the inability to personally inspect between guests.

In our experience, professionally managed properties net the owner as much or more than self-managed properties after accounting for the management fee — because the higher gross revenue and lower problem rate more than offset the fee. And the owner's time investment drops from 15+ hours per month to nearly zero.