Do your research when renting vacation home

NEW YORK — With three adult children, Teri Hurley made sure to book a house with three bedrooms for her family's Thanksgiving vacation in New York's Catskill Mountains.

She was stunned — and angry — when she discovered that the third bedroom of the rental property was down a narrow, steep set of stairs under a kitchen trapdoor, half hidden by a scatter rug.

"My son volunteered to play dungeon boy and took the basement accommodation," Hurley said. "When he wanted to enter the living area, he had to pound on his ceiling — our floor — so we could open the trap door to let him up!"

When Hurley got home, she complained to VRBO.com, where she booked the rental online, but ultimately decided not to go through with a formal complaint. The disappointing experience in 2008 hasn't stopped her from renting on VRBO.com, which stands for vacation rentals by owner. For 10 years her family has stayed at the same Florida villa she found on VRBO. And last Christmas, she rented a "stunning" log house on 10 acres outside Woodstock, N.Y., also from VRBO.

The vacation rental market — booking a vacation property directly from the owner or from a property management company — is booming. A study released in 2009 by the travel industry research firm PhoCusWright Inc. estimated the market to be $24.3 billion, or more than a fifth of the U.S. lodging industry (based on room revenue) of $107 billion in 2007.

Alexis de Belloy, vice president of U.S. business at HomeAway Inc., the world's largest vacation rental marketplace and owner of sites including HomeAway.com, VRBO.com and VacationRentals.com, says HomeAway facilitates more than 300,000 bookings a month with only a "handful of instances" of unsatisfactory rentals.

While he wasn't familiar with the particulars of Hurley's complaint, he says HomeAway has a staff of 100 who do customer support, including investigate complaints. Documentation of a problem can lead to a listing being taken down. He also notes that the company offers rental insurance up to $10,000 that protects against Internet fraud and foreclosure, with the average cost for insurance about $44.

The demand for vacation rentals is being driven by a number of factors: a large supply of second homes, some purchased as investments; more travel by large, multigenerational groups, including for family reunions; and economies of scale, which can make a vacation rental a better value than hotels, especially for longer stays. Another driver is the Internet, which lets both rental companies and individual homeowners go online to market their homes.