Before You Sign with an Agency: What to Agree in Advance

The decision is made: you no longer want to answer enquiries at midnight yourself or hunt for a cleaner for a Saturday in August. You are handing the house over to an agency or a property manager. If you are still weighing up agencies, platforms and listing portals, take a look at our comparison of the 5 best options for holiday rental owners on Krk. This article starts where that comparison ends: at the moment you sit down at the table with someone.

Most bad experiences with agencies do not come from a commission that is too high. They come from a job nobody took on, because both sides assumed the other one was doing it. A guest reports at 9 p.m. in July that the air conditioning is not working. The owner in Munich assumes the agency deals with it; the agency assumes the owner has his own repairman. The guest waits, the rating drops, and the contract says nothing about it.

This is therefore a list of everything that must be agreed before the first booking, whether you are signing with an agency that manages hundreds of properties, a local property manager or a neighbour who "keeps an eye on the house". It also applies to arrangements that are already running: if you cannot answer one of the questions in this article, it is time for a conversation.

Five jobs someone has to do

Renting out a single holiday home consists of five areas of work. Each must have one person responsible. "Jointly" in practice means "nobody". The sixth row of the table is not a job but the condition for the first five to be possible at all.

Pricing and sales. An agency that manages several properties sees how fast dates are filling up and when a price is stalling. Agree who proposes prices and who approves them, and how often they are reviewed: once before the season or every few weeks. Also ask who decides on last-minute discounts and minimum stays. One house with two different prices on two channels looks suspicious to a guest and brings you the booking at the lower one, so agree that prices are aligned across all channels. And something that is rarely asked but hurts most at parting: are the listings on Booking.com and Airbnb in your user account or in the agency's? Reviews belong to the account, not to the house.

Communication. A guest who cannot work out how to switch on the pool heating at 10 p.m. on a Saturday does not want your number abroad. Agree who answers enquiries and how quickly, in which languages, who talks to a guest who complains during the stay and who writes the replies to reviews. Also clarify whether you receive the guests' details or whether they stay with the agency.

Changeovers. A Saturday-to-Saturday changeover in July means that between a 10 a.m. departure and a 4 p.m. arrival someone has to clean the house, change the linen, check the pool and look for anything broken. Agree who orders and pays for cleaning, whether the linen is yours or hired, who hands over keys or maintains the smart lock, and who does the final check with photographs. Without photographs after departure, every later dispute about damage is one word against another.

Administration. Every guest must be registered in eVisitor within 24 hours of arrival (Croatian Tourist Tax Act, NN 52/19, 32/20, 42/20). The agency can do this for you, but agree explicitly who does it and who is responsible if a registration is late. Who issues the invoice to the guest and who collects payment depends on the cooperation model: does the agency sell the accommodation in its own name or merely act as an intermediary? This is not a detail, because it determines who is the taxpayer for that service. Owners who do not live in Croatia need to settle this before the first booking, because it decides whether they have to enter the Croatian VAT system themselves or whether the agency handles it under the agreed model. The models are described in our guide for non-residents and in the article on VAT for non-residents.

Faults and complaints. This is where even well-planned arrangements fall apart. Agree three things: who comes to the house first and within what time, up to what amount the agency may order a repair without your approval, and how that cost is settled. An owner who wants to approve every light bulb slows down the solution; an agency that replaces a boiler without asking is spending someone else's money. The threshold, for example the amount below which the owner is not called, must be written down. The same applies to damage: who establishes it when the guest leaves, who documents it, who holds the deposit and who decides whether to charge it. If the house is sold through platforms, also ask who handles the damage claim process with the platform.

Presence on the island. An agency may have a nice office in Rijeka or Zagreb and perfect listings, but when a pipe bursts in August, what matters is who can be in Baška within half an hour. Ask where the nearest person who comes to your house is based, how many properties that person covers at the peak of the season and whether they work at weekends. The answer reveals more than any presentation.

Money: the percentage is only the beginning

Two offers with the same percentage can differ by hundreds of euros per booking. The difference lies in what the percentage includes. Go through it item by item: cleaning and linen, photography and listing creation, pool and garden maintenance, consumables, platform commissions. If the agency lists the house on Booking.com, does it pay Booking's commission out of its own percentage, or is it deducted from your share? The same question applies to card payment fees.

Then the flow of money. Who charges the guest and when do you get paid: after arrival, after departure or once a month? What do you receive with the payout: a statement per booking with the price the guest paid, the deductions and your net amount, or just a figure on your bank statement? Insist that a per-booking statement is mandatory. Also agree what happens with cancellations: who keeps any cancellation fee, and does the agency carry part of the risk or does it all fall on you?

The calendar and your own stays

The house is yours and you will want to spend a week there in June. The only question is how you announce it and by when. Agree who blocks dates, how far in advance you must announce your own stay and whether you may block peak season once the price list has been published. Also agree who is responsible for keeping the calendar up to date on all channels. A double booking is the most expensive mistake in this business: the guest arrives at a locked door and you pay for the replacement accommodation.

The contract: duration and exit

A good contract is written for the day the cooperation ends. Check the duration and the notice period, and what happens to bookings already confirmed when you give notice: are they fulfilled under the old terms, transferred to you or cancelled for the guests? Check exclusivity: may you sell dates yourself at the same time, to friends or through your own listing? And check who owns what is created during the cooperation: photographs, listing texts, reviews, the Google Maps profile. An agency that paid the photographer is entitled to keep the photographs, but you need to know that beforehand, not on the day you ask for your listing back.

What remains with you

The agency takes over the work, not your legal status. If the categorisation licence is issued in your name, the host's obligations under Article 32 of the Croatian Hospitality Act (NN 85/15 as amended) remain yours: the displayed category plaque, the price list, the condition of the property, written complaints. When the inspector walks into the house, they will ask for the licence holder. The flat-rate tax, tourist tax and tourist board membership fee, the house insurance and everything to do with the legality of the building also remain yours. Your arrangement with the agency can be that it tracks these obligations and reminds you of deadlines, but the contract must state who pays and who is responsible.

For owners who do not live in Croatia there is one more question here: which tax model are you in, and who in that model communicates with the Croatian Tax Administration? The answer must be clear before the first guest payment, not after the first season.

Questions for the meeting

Take this list with you. A serious agency answers every question without hesitation, because it has already settled them in its contract.

• Who proposes prices, who approves them and how often do they change?
• Are the platform listings in my user account or yours?
• Who answers guests, within what time and in which languages?
• Who orders and pays for cleaning, whose linen is it, who does the final check?
• Who registers guests in eVisitor and who issues the invoice to the guest?
• Up to what amount do you order repairs without my approval?
• Who establishes damage, who holds the deposit and who decides whether to charge it?
• Where is your nearest person to my house and how many properties do they cover in August?
• What exactly does the commission include, and what is charged separately?
• When and how do I receive the payout and the per-booking statement?
• How do I announce my own stay and who blocks the calendar?
• What is the notice period and what happens to confirmed bookings if I leave?

If a question is met with silence, that is not a reason to walk away. It is a reason to make sure the answer ends up in the contract.

Krk danas Editorial Team

What happens to bookings, listings and reviews when you move your house from one agency to another is covered in our article Changing Your Rental Agency Before the New Season.

Sources

Registration and check-out of tourists, gov.hr
Croatian Tourist Tax Act (NN 52/19, 32/20, 42/20)
Croatian Hospitality Act (NN 85/15 as amended), Article 32