Airbnb & Coronavirus: How to Survive Short-Term Rental Losses

Airbnb & Coronavirus: How to Survive Short-Term Rental Losses

3 min read
Avery Carl

Avery Carl is a top 1 percent real estate agent and CEO/founder of The Short Term Shop, a national real estate firm that represents and mentors investors in the buying and selling of investment properties in the top short-term and vacation rental markets in the U.S.

Experience
Avery bought her first investment at the age of 26 on a $37,000 salary, and through strategically investing in mature vacation rental markets, scaled her portfolio to 30 doors (a mix of both vacation rentals and traditional long-term rentals) and achieved financial freedom by age 30. The Short Term Shop helps investors acquire short-term rental properties in the most recession-resistant markets and mentors them using the methods that led her out of the corporate rat race and into financial freedom.

On the sales side, Avery has connected investors with over $100 million in cash-flowing vacation rental investments since 2017 and was named the Tennessee Association of Realtors “Rookie of the Year” in 2017.

Press
Avery has been sharing her knowledge on how to use vacation rentals as a vehicle to accelerate cash flow and scale investment portfolios quickly on the BiggerPockets real estate network for four years, most recently serving as a speaker at the BiggerPockets Conference in 2019. She’s also appeared on two BiggerPockets Real Estate Podcast episodes, #364 and #375, as well as contributed to the BiggerPockets YouTube channel and blog.

In addition, she has written articles for USA Today, Realtor.com, Yahoo Finance, U.S. News & World Report, and the Turnkey Vacation Rental Blog. She has been a guest on the Joe Fairless Best Real Estate Investing Advice Ever podcast on two occasions, as well as on Real Estate Money School, Investing in the U.S., School for Startups, Wealth Without Wall Street, and Flipping America.

Education
Avery earned a Bachelor of Science from the University of Texas, as well as a Masters of Business Administration (Marketing) from Belmont University.

Accreditations
Licensed real estate agent in Tennessee, Florida, and Alabama.

Follow
Instagram @theshorttermshop
Twitter @shorttermshop
The Short Term Shop on Facebook
TheShortTermShop.com

Read More

I’m here today to discuss how short-term rental investors can best weather these very uncertain times that we’ve entered as the coronavirus pandemic upends the rental market. Let’s get started.

How Airbnb Investors Should Respond to Coronavirus Cancellations

1. Don’t Panic

Number one—and this is the most important piece of advice that I’m going to give you today—do not panic. Don’t panic and sell off all your investments in an act of fear.

I totally understand that fear of the unknown is way scarier than the fear of any known element we can think of.

I ask you not to make any big decisions about your investments right now. Take a breather. Give it a couple of weeks. Let’s see what’s going to happen before we make any rash decisions about our investments.

airbnb arbitrage

Related: The Impact of Coronavirus on Real Estate Markets

2. Adjust Your Listings

Number two—adjust your listings. In both my beach and mountain markets, we received a wave of cancellations, as we all did when the coronavirus first started.

A few days later, we actually got a wave of inquiries from people who had been social distancing in their homes, were going a little stir crazy, and wanted a change of scenery while social distancing.

So anything you can do to make your listing more attractive to potential social distancing renters, go ahead and do that—whether it’s adjusting your prices, adjusting your minimum and maximum night stays, or making your listing pet-friendly for a while.

Make a list of all of the food and delivery services that serve your location and put it on the front of your listing. Do anything you can do to make your listing stand out as a place where people can go and social distance while still being able to meet their needs.

3. Communicate With Your Guests

Number three—communicate with your guests. Now’s a really good time to turn off all those automations that we love so much and communicate as a human being with your guests.

Guests are going to be extra cranky right now. They’ve got a lot to think about, as we all do—income, family, what’s going to happen next, fear of the future.

So they are going to be a little more sensitive to things about your house that they might not have been concerned about three or four weeks ago.

You catch more bees with honey though. I’ve turned off the automations and am having real conversations with my guests to make sure that they’re happy.

Humanize yourself. Make sure they know that you’re a real person and not some corporation that owns a ton of properties like a hotel. Anything you can do to make yourself more human to your guests is going to be beneficial to you.

And it’s also a really good time to show some grace to our fellow humans. We’re all in this thing together, and it’s not easy for any of us.

Communicate personally with your guests, and turn those automations off for a little while.

airbnb rental markets

4. Rental Arbitrageurs

Number four—rental arbitrageurs. I have not historically been a fan of this method, but there’s definitely a time and place for it. I think that time is now.

For those of you who don’t know, rental arbitrage is a method in which someone will rent your property on a long-term basis with a traditional lease and then turn around and Airbnb it on the backend.

This is a really good option for people who maybe don’t have the cash reserves in place that they wish they did. They want some security with knowing that their mortgage is going to be paid.

I’ve actually had several arbitrageurs reach out to me and ask if I have any clients who are worried about their mortgage payments. They would like to forego the short-term game for a bit and go ahead and sign some long-term leases.

So that’s definitely an option right now if you’re unsure about covering your expenses. Reach out to a few arbitrageurs and see if they might be interested in running your property long-term.

Related: Airbnb Arbitrage: 3 Tips for Persuading Rental Owners to Work With You

5. Refinance Your Property

Last, it might be a good time to explore financing options and refinance your property. At the time of writing, interest rates are really good.

If you start to refinance now in March and close in April, your next mortgage payment is not going to be due until June.

That buys you a little bit of time to get your bearings, get your feet underneath you, and figure out what’s going on before you make any big decisions about your investments.

That’s it for my five tips. And remember, we’re all in this together.

blog ads 02

How are you currently dealing with the challenges of managing your Airbnb properties?

Join the conversation in the comments below.

Coronavirus is upending the vacation, travel, and short-term rental industries. Airbnb hosts, VRBO property owners, and other professionals in the short-term rental business are scrambling to make necessary adjustments. Here are several tips on how STR investors can best weather these very uncertain times.