AIR BNB Question
I have a 5 bedroom home on Lake Minnetonka in Excelsior MN that I want to Air BNB it starting in August. I understand the prime months are May through September. My question is how much success have people had with Air BNB in the "off season" in the Minneapolis area? Or more specifically the the Excelsior area? Thanks for any feedback!
Most Popular Reply
We've been managing furnished mo/mo rentals all over the Twin Cities metro for years. We get lots of interest in larger family homes in the western burbs throughout the year, many for 30-120 night stays. My advice would be to have a 3 night minimum in the summer to maximize revenue, and switch to a 60 night minimum during the off season. If you are priced appropriately ~sub 5500/mo you'll find a solid mid-term tenant for the winter, families are always moving to the Twin Cities.
- Adam Tafel
You may not find people here who have that answer but I am sure everyone will suggest you look on AirDNA and connect with other local owners on Lake Minnetonka.
I believe most people do see action if the amenities and prices are right.
#2 Short-Term & Vacation Rental Discussions Contributor
- Olympia, WA
- 7,542
- Votes |
- 8,640
- Posts
#2 Short-Term & Vacation Rental Discussions Contributor
- Olympia, WA
Hey @Mark ODay, I don't have a specific answer for you in that area, but we are on Lake Coeur d'Alene in north Idaho. We are pretty seasonal from May to Oct. There is a 72 mile bike trail that runs in front of our house between the beach.
We are pretty empty from mid Oct until May. We get a week long Thanksgiving booking most of the time as well as a 10 day Christmas to New Years booking. Rarely a Valentines Day. We are too far away from skiing and there isn't much else to do. The lake doesn't freeze over thick enough in our area to allow ice fishing.
Does the lake in your area freeze over thick enough to allow ice fishing? Is it close to skiing?
Check the listings in the area on VRBO and AirBNB to see how their calendars look. That can give you a good idea. Also check out Awning.coms estimator. It is free and pulls the same data as AirDNA.
Not familiar with that market. Is there any skiing or winter sports there?
“Most of the time” in a lake market you’re going to have some dead time during the winter. Which is always nice for deep cleaning and maintenance
@Adam Tafel Any thought on this?
- Bryon Andrews
- [email protected]
- 715-892-4596
I know the twin cities market quite well. If the property is nice and priced correctly, you can typically still book our weekends and holidays in the shoulder season.
Again, you can’t be prideful on price here.
Thanks for the info! In general what sort of % discount are we talking from Peak season to shoulder as you call it?
Yes its wintery enough. Lake freezes pretty well for ice fishing etc. No downhill skiing to speak of but cross country of course
@Mark ODay there is very limited bookings during the winter in minnesota unless you are in an area people still need to travel or there are activities in the area. Lake Minnetonka is not a lake that has much for winter activities. You have the chilli cookoff thing but that is really about it. If you can't rent it for the summer months I would expect you to lose money your first year.
#3 Real Estate News & Current Events Contributor
- Real Estate Broker
- Minneapolis, MN
- 6,546
- Votes |
- 5,028
- Posts
#3 Real Estate News & Current Events Contributor
- Real Estate Broker
- Minneapolis, MN
@Mark ODay how much do you know, or how experienced are you at hosting a STR?
I have a feeling the answer is 0 because someone who knows this space, would never be asking this question. On the lake, in Excelsior is like saying you have a place on the beach in Malibu, how will it do....
If you know what your doing, it will be a year round printing press of $. But if you think one can throw together IKEA furnishings and "cash-in" the market will punish you severely.
Done correctly there should be minimal fluctuations through the year. If your not a pro at STR with ready knowledge of how to turn it into $40k+ mnthly in rev., then I STRONGLY suggest a JV with those who do. That market has a certain level of requirement to "unlock" that full potential revenue stream.
I was intentionally ambiguous for my own reasons. I do not need to give specific local to hopefully get useful information on this question. And whether intended or not you come off as condescending. No problem, I got you. Really besides giving me some acronyms to look up your reply does nothing for me. Thanks
Hello @Mark ODay,
We manage a property on the St.Croix (4bd, 2bth) with dock access and a pontoon. It is seasonal, but even in the off peak season it does more than break even. I'd imagine your property would have similar success as well Airdna can be a good starting place, but a deeper dive into all the individual STR's in the area is an even better route. A thorough market and property analysis is all part of the due diligence when looking to setup an STR. STR's in this market today are not performing like they did in 2021-2022. The travel surge post covid is over, so most successful properties are professionally managed/co hosted to ensure maximum success. 4.9 rating and above listings will survive the so called "airbnb" collapse. 2.6 billon per year still travel, the need is there, the supply is going down with all the hobbyists/opportunists now jumping ship because they don't run it like a hospitality business will run it.
Thanks for the input! It is my intention to "become" a professional at this. We are using MN Stay for now, but I am actually interested in learning how to do it. I am self umployed and grew up in the service industry as my parents owned a race track and resturant. Not a hotel/motel per se,but I believe service is service. Now it is a matter of due deligence and experience. I have no illusions of anything really, I know that much at least! What portals do you use for your " deeper dive into all the individual STR's in the area"? Besides Air DNA?
Thanks !
Hi @Mark ODay,
We are purchasing a property near Duluth, MN (Oliver, WI) on the St. Louis River and have similar questions about seasonality, etc. We have several long-term rentals we manage, but this is our first short-term rental. I will definitely pass along anything we learn in the process. Please pass along anything you learn in the process. Good luck with your endeavor. Lake Minnetonka is such a nice lake, I am optimistic you will do well.
Corey
I usually take anywhere from 10-20% off of the nightly rate during the low seasons.
Wow thank you! Yes please keep me updated. I will do the same. We start in August : )
Pricelabs has a neat market dashboard that lets you gather some data on the market. It'll tell you numbers of all the active STR's in a given market. A lot of numbers may be skewed though, if that property manually blocks off their calendar for winter months or other inactive months, which will automatically show as filled occupancy and revenue generated at whatever price their calendar has set for those days. So then you'd need to do a deeper manual dive into each listing in the area on each platform and see their actual calendar. That can help get you to a closer KPI number for each listing and give you a better estimate of what your property can do.
@Mark ODay, initially I thought James had quite the arrogant response, but I do believe his intention was there. Starting out in the STR world post-pandemic, is going to be brutal if you have minimal experience and know how. Everyone and their mother was listing on Airbnb and VRBO post lockdown clearance. Everyone who did it even at a horrible level, was making good money. Those days are gone, hence those people listing them for sale because they didn't have a clue what they were doing or how to run a business centered around hospitality. The ones who will consistently survive and thrive in the STR world, are those running it as a business and who are passionate about it.
I would highly suggest you invest as much time as possiblle into how to do it properly. Underwriting your property and doing DD is critical, you screw that up, and you'll quickly lose thousands.
I had advised a client of mine to step away and not go through closing on a property due to the location alone. It was the PERFECT property in the absolute WORST location. 8 months later, he is selling that property, and even gave me the "welp, you were right" talk. Learn from other's mistakes and if you're serious about operating STR's and you're not opting to have a co-host, know that it can and almost ALWAYS is a full time job, unless you have an excellent team in place and your automations and tech stack is on point.
The comment from James really didnt bother me. He made great points. He sounds like a hard assed Realty type. I like to know people like that.They tell you what they think. I miss the East Coast for those reasons. He simply was wrong on why I wasnt more specific on the location. I have my reasons for that. The rest of what he said was true.
You present an interesting use case. Lake Minnetonka is not your typical MN lake. It's not a vacation area like a northern lake, but it's far enough away from the cities that a weekend traveler might not seek it out during the Winter. I don't think we have nearly the details to give you great advice in this case, but a few thoughts worth considering.
Since Minnetonka is arguably the most sought-after metro lake and boasts some epic homes, you might want to consider executive rentals or renting to a professional athlete. Those two markets have the cash and desire to pay to live in an exceptional location with furnishings but without the long-term commitment of ownership. Your benefit would be to avoid the seasonality and work that goes with long-term rentals.
If executive rentals do not interest you, I would recommend partnering to start. The STR market has gotten competitive, and those properties that do not deliver unique experiences are starting to suffer. There are many stories in other sought-after markets such as Orlando of owners using the "build it and they will come" approach only to sell at a loss after a few years. Generally, STR travelers want price, location, or experience, and if you want a high price, you need one of the other two nailed and 2/2 to kill it. Good luck I hope you crush it!
We've been managing furnished mo/mo rentals all over the Twin Cities metro for years. We get lots of interest in larger family homes in the western burbs throughout the year, many for 30-120 night stays. My advice would be to have a 3 night minimum in the summer to maximize revenue, and switch to a 60 night minimum during the off season. If you are priced appropriately ~sub 5500/mo you'll find a solid mid-term tenant for the winter, families are always moving to the Twin Cities.
- Adam Tafel