Short-Term Rentals for Long-Term Profits

Why do we like short-term rentals as an investment niche? Short-term rentals lead to long-term profits!

But don’t take our word for it. 

We’re talking with a real-life short-term rental investor to discover what it takes to be successful in the world of short-term rentals. 

Learn practical tips and tricks … and have some fun along the way. 

In this episode of The Real Estate Guys™ show, hear from:

  • Your long-suffering host, Robert Helms
  • His short and sweet co-host, Russell Gray 
  • International real estate investor, world traveler, and short-term rental guru, Tim Hubbard

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A Unique Investment Opportunity 

There are many ways to invest in real estate. 

You can put a tenant in a property and just let them stay for a long, long time … but there are actually reasons that shorter occupancy lengths can be really profitable. 

In fact, short-term rentals can be one of the most profitable ways to invest in real estate … and it can be one of the lower risk ways to invest in real estate. 

So, let’s set the stage. 

In most buy-and-hold situations, you have either a month-to-month rental period or an annual rental period. Sometimes a commercial property has a 5, 10, or 20-year lease. 

The amount of time that you’re tying up a property with the tenant completely depends on you, the property, and the marketplace. 

Recently, everyone has been enamored with vacation rentals. 

You buy a property in a niche market that people love to visit. Instead of renting it on a month-to-month basis, you rent it on a nightly or weekly basis … and that can up your returns. 

But there are also corporate rentals and contractor rentals … all kinds of ways to rent for shorter periods of time. 

And apps have made it possible for you to reach consumers without spending large amounts of money on advertising. 

One of the great things about short-term rental properties is that you can build up a clientele of repeat customers … people who fall in love with an area, have regular business in the area or come to visit family. 

When you develop that relationship with a client … just like you would with any tenant … they come back again and again … and maybe even tell other people. 

Another consideration is that many short-term rental opportunities also come with the potential for personal use. You could use the property when you travel and rent it for the rest of the time. 

But this is an area of real estate that takes a little more thought and education. You don’t just put a yard sign out in front of your property that says, “Available by the night.”

That’s why today, we’re chatting with an expert.

Making the Most of Your Short-Term Rental

We met Tim Hubbard many years back when he attended the Secrets of Successful Syndication. He then came on the Investors’ Summit, and he has been on every one since. 

Tim on his own account has more than two dozen of these types of short-term rental units. 

“All the properties I’ve acquired had long-term tenants in them. I just found traveling that you can get a lot more by the night, so I started doing that instead,” Tim says. 

Sometimes people stay in Tim’s properties for a longer amount of time … like for a month … but he is still getting nightly rates. 

Tim takes a unique approach to rentals. He doesn’t necessarily cater to just vacationers. 

“I try to find the best properties for business people first because they tend to come back more often, and they tend to travel alone. They’re professional, and they don’t have parties.” Tim says. 

But unlike a rental where tenants move in and out once a year, short-term renters are coming and going every few days. 

There’s a lot of housekeeping and a lot of operational pieces. 

It’s common for people starting out with their first property to clean themselves and handle guest messages … but by finding other ways to take care of that, you can scale quickly and continue to scale. 

Outside of having managers that run these processes for him, Tim has also found other ways to simplify the short-term rental experience. 

One way is by having digital locks with door codes on all the properties. This allows guests to check themselves in. 

Tim has also created guidebooks that go out digitally and give guests the necessary information they need to know about the property. 

“It’s really about figuring out what the guest is going to ask you before they show up and answering those questions before they even arrive,” Tim says. 

This cuts down on guest messages and increases the likelihood they will leave a great review at the end. 

You also need to offer some standard amenities. Think about the normal amenities you would find at a hotel like an iron and coffee. 

You Can Find Success

Many people think that you have to be in some big top market in order to attract guests … but that’s not true. 

There is a client that wants to stay at a unit like yours in almost any city that has commerce or industry. 

Like any other investment … it’s important to do your research. But with the right tools in place, you can find long-term success with short-term rentals. 

Listen to the full episode and learn more tips and tricks from Tim!

More From The Real Estate Guys™…

The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training, and resources to help real estate investors succeed.


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Market Moves of Major Players

When big companies like Costco, Walmart, Home Depot and McDonald’s start moving into a residential real estate market it’s because they expect growth.

And they’re usually right.  After all, they have the budgets to buy the best data and hire the smartest analysts.

Some of the data the consider includes migration trends, infrastructure plans and demographic shifts.

Do people want to move there?  Are they Major corporations like Southwest and Hilton carefully analyze market data before making moves into places like Belize.the RIGHT demographic?  Are there freeways, airports, and other key pieces of infrastructure to support a growing population?

When everything checks out, these big organizations begin to move in… to get in ahead of growth.

Savvy residential real estate investors watch these moves … and then start to investigate.  It’s a way to piggy-back on the hard work paid for by the big players.

For those interested in resort property investing … and there are some compelling reasons to consider it right now … the principle is the same, but the players are different.

Resort properties make their money renting to tourists, not tenants.  The migration patterns aren’t gleaned from U-Haul statistics, but from airlines.

The companies moving in aren’t big box retailers, but rather big brand hotels.

So when you see a major airline adding flights to a resort destination, it’s in response to growing demand.

That’s a clue.Major airlines like Southwest Airlines, Delta and American Airlines are adding flights into Belize

Ditto for when a major hotel brand plants it’s first flag in an emerging resort market.  They have strong reasons to believe the tourists and occupancy are there or soon will be.

When those things are happening at the same time, in the same market …. SOMETHING must be happening to attract this attention.  And it is …

Tourism to Belize continues to boom.  And major players are making moves to take advantage of Belize’s growing popularity.

Of course, there’s a LOT more to this story than can be told in a few hundred words.

That’s why we’re heading to Belize for a fun-filled, educational field trip … and YOU are invited to join us!

Come see what makes this tropical paradise one of the most exciting resort property market in the Western Hemisphere … and why major players are making their moves.

Ambergris Caye Belize is one of the most exciting resort property markets in the Western HemisphereMany investors use low-end residential properties as a vehicle to build wealth so some day they can own and enjoy a beautiful resort property.

Imagine buying a resort property as an investment and still enjoy some personal use.

It’s possible.  And it starts with picking the right market, meeting the right team, and finding the right property.

The timing’s never been better.  Tens of thousands of baby boomers are retiring every day.  Studies say many wish to travel … maybe even retire … abroad.

Belize is a popular destination because it’s close the U.S., English-speaking, friendly to Americans … and REALLY beautiful!

You’re going to LOVE it.

Click here now to discover enchanting Belize!

10/12/14: Ask The Guys – Making Wise Choices in Your Real Estate Investing

Life as a real estate investors means making choices between the many options available.

In this episode of Ask The Guys, we take on a pile of listener questions that have to do with choosing.

Making the choice to be in the studio for this decidedly interesting episode:

  • Your choosy host, Robert Helms
  • His cheesy co-host, Russell Gray
  • The prime choice for wisdom, The Godfather of Real Estate, Bob Helms
  • Special guest contributor, Danny Kalenov

We kick off the show with a Happy Birthday greeting to the Godfather, who just celebrated his 80th!  We’re guessing he’s learned a thing or two about investing over that time.

Then we take on a question from a young guy on the other end of the age spectrum.  He’s just getting started and wants to know how to build up his credit and credibility.

Since a credit score is really a reflection of how one handles credit, the somewhat obvious answer is to start handling credit responsibly.

It starts with simple accounts like cell phones, utilities and small credit cards.  Then you can graduate up to installment loans like a computer, car or personal loan.

The goal isn’t to go into debt…at least not yet.  It’s simply to demonstrate a consistent history of timely payments.  And the sooner you get started, the better.

But while you’re doing that, you can still go do deals.  It means you have to find partners who have what you lack and need what you have.

For a young person, you usually need everything, but you can offer hustle, specialized knowledge, relationships and deal flow.  For older, busier folks, those things are hard to come by.

And just like credit, you build credibility over time when you behave correctly.  Dress right, keep your promises, show evidence of success and responsibility, associate with credible people, and do your homework!  People can tell if you know what you’re talking about…and they’ll judge you by your knowledge and your ability to articulate it.

Another question came up about how to find prospective investors.  The GREAT NEWS is that a recent law is opening up more options for real estate entrepreneurs to promote their offerings without running afoul of securities law.

Technology brought peer-to-peer lending into the marketplace several years ago.  Now, the new law opens up this crowd funding concept to equity investing.  And there are many crowd funding platforms (on line marketplaces) created…with more coming.Crowd funding promises to be an exciting new way to raise money for real estate investing

But you don’t have to wait.

You still have the choice of to raise money the old-fashioned way: networking.

So building your brand (credibility) and your network (connections) can still be done by attending events, building relationship, getting referrals and telling your story.

And while you can just make it up as you go along, a better choice is to be prepared.  Anyone who’s a serious investor will expect to see a business plan.  Hopefully a good one.

How do you learn to write a good business plan?  Start by reading a lot of business plans.  You’ll quickly recognize good from bad, and you’ll pick up ideas about how to explain your offering with enthusiasm and credibility.

Of course, this is the natural place to promote our most popular seminar, The Secrets of Successful Syndication.   We created it because we get so many questions from people who want to go big, but don’t have enough resources to do it on their own.

And while “No Money Down” books, recordings and seminars are easily sold, the real secret is to raise money from investors.

Of course, this is another choice.  Do you want to go it alone or would you like to have investors?  They both have pros and cons.

So how do you decide?  And how do you learn?

Real estate investor development usually starts with knowledge, which you can get from books and classes.

But to really understand what life is like in any profession and what it takes to be successful, finding a mentor is arguably the best choice.

Some mentors charge a fee.  Others will take a portion of the profits.  A few will even do it simply for the reward of sharing their knowledge (rare, but great to find!)

Which is better?

It depends.  If the mentor has what you want, and what you have to pay to get it makes good business sense to you, then whatever arrangement you make is right.

Our caveat is to avoid long term commitments (in anything, not just investment mentoring) until you’re certain the value is really there and you’ll be happy with it over the long term.

Also remember, that 100% of nothing is still nothing.  So if you need help to get your business going, then giving something away is probably a good investment.

And if your resources are light at the beginning, but a mentor believes in you and your plan, then revenue sharing puts more of the risk on the mentor.  In this case, it’s only fair they have a shot at a bigger reward.

If you can afford to pay a flat fee, and are confident in your ability and opportunities, then you may want to take more risk in order to retain more of the reward.

Whatever you choose, be sure to establish a positive, equitable relationship with your mentor.  Don’t treat him or her like a vendor and penny-pinch them.  You want to be generous so they are inclined to be generous as well.

At the end of the episode, we ask special guest contributor Danny Kalenov to help a listener with choice about a resort property investment.

Danny is a successful resort property developer/owner/operator and is very qualified to help answer a question about how to approach the decision to buy a resort property.  Is it primarily an investment or is it a lifestyle expense?

Of course, the answer is…it depends.

If you want it to make a profit, then your personal use may have to take a back seat to customer demand.  That is, you can enjoy the property, but the odds are you’ll be doing so during unpopular times of the year.  Effectively, you get leftovers.

But if you want to enjoy the property as a consumer, your profitability will probably suffer.  Worse, if your property isn’t available during peak times, your customers may give up and look elsewhere.

Of course, if all you’re looking for is a little income to offset your personal expense, this can be okay.

Obviously, in this…and all the questions we take in this episode…it’s your choice.

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The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training and resources that help real estate investors succeed.

Three Easy Steps to Improving Your Holiday Rental Listing

three easy steps to improving your holiday listingA decade or two ago, vacation home rentals were handled by professional vacation rental managers. Now, only 40 percent of these rentals are managed by professionals, according to the Vacation Rental Managers Association. If you are a vacation homeowner who has decided to tackle renting out and managing your vacation property on your own, you may be wondering how to boost your appeal. Using these tips, you can ensure that your holiday rental doesn’t sit empty very often:

Maximize the Internet

One of the reasons holiday property owners no longer have to turn their properties over to professional managers is the rise of Internet-based listing sites. Sites like AirBnB.com, HomeAway.com, and VRBO.com allow owners to post a free ad. Interested guests can search for holiday homes based on amenities, location, number of bedrooms and more, and guests can even pay for the rental through the site, which ensures that you don’t get stuck with a missed arrival and no payment.

If you opt to use one of these sites, ensure that your listing really sings. Write about bedrooms and bathrooms near the top of the listing as these facts have a huge impact on how many people can comfortably stay in your property. Remember to include compelling pictures — you might even want to invest in a professional photographer.

Boost Your Amenities

If you aren’t getting enough interest in your property, look at the most successful properties on those sites, and ask yourself what they have that you don’t have. Clearly, you can’t move your small town bed and breakfast to the city and you can’t move your cabin in the forest to the Alps, but you can make a few changes. You could add an exercise room or a hot tub. Specials on used equipment from stores like 2nd Wind Exercise make setting up an exercise room affordable, and there are always used hot tubs available on local resale websites.

While adding amenities, keep in mind that travelers like to be comfortable, and sometimes, it can be unnerving to stay in someone else’s home. To soothe your guests, consider adding a top rated security system from Lifeshield. These are easy to work, and they provide your guests with peace of mind. FlipKey.com also recommends adding amenities to be used in the area as well — offer you guests discount tickets to nearby restaurants, ski hills, or amusement parks.

Recommend Yourself

You know your property is great and so do the people who have stayed there. It’s time to let the world hear your positive reviews. Solicit former guests to write reviews for you on online travel sites. Post their glowing words on your social media account or copy them into a brochure. Guests like to stay in places that have a good reputation, and you can boost yours with a few free recommendations. If your former guests drag their feet on writing your reviews, give them a free night or a discounted week in exchange for their reviews.

Getting Started

If you are just getting started, you can post an ad on the sites listed above and increase your amenities as allowed by your budget. You will find it harder to get recommendations. Instead, invite a traveler blogger or someone else who can help you to get exposure to tour your place. Let them post pictures and reviews of your vacation home on their website. These three easy steps can be accomplished over a weekend, and many of them can be taken care of in just an hour or so. You will love the difference it makes in keeping your rental full.

This post provided by The Real Estate Guys™  guest contributor, Norma Martin