3 Months into my newest Airbnb...still optimistically looking ahead! Thoughts?

Question

I wanted to be transparent and share where I’m at in my journey — hoping this helps someone else, and also opens the door for advice and connection.

After a year and a half of analysis paralysis, I finally launched my Texas STR this summer. I put alot into it (and maybe haven't done all I can yet, but still!):

• Purchased with a conventional loan (pretty sure I’m maxed out on financing this way now, especially with little income to show).
• Invested heavily up front: conferences, bootcamps, small groups, professional designer for full setup, studied comps, professional photographer, priced strategically/dynamic pricing.
• I work two jobs (foreclosure auctions + hotel), so hospitality is something I genuinely love and plan to stick with long-term.              
• Goal = 4 STRs in 4 years (buying one each year or so).

Purchased with a conventional loan (pretty sure I’m maxed out on financing this way now, especially with little income to show).

Invested heavily up front: conferences, bootcamps, small groups, professional designer for full setup, studied comps, professional photographer, priced strategically/dynamic pricing.

I work two jobs (foreclosure auctions + hotel), so hospitality is something I genuinely love and plan to stick with long-term.

Goal = 4 STRs in 4 years (buying one each year or so).

The reality so far:

• 1 booking in June, 2 in July, 2 in August — all through Airbnb. (Listed on several sites, but most traffic came through here)
• Just partnered with big Vacation Rental PM last week. Booked each weekend in September, but at $340/night (well below my target for my 5 bedroom amenity packed home) and with my calendar wide open for future events I would have normally raised prices for.
• Honestly, I don’t love the experience with vacation rental PM so far. I was expecting more value for 15% than lower rates + open calendar.

1 booking in June, 2 in July, 2 in August — all through Airbnb. (Listed on several sites, but most traffic came through here)

Just partnered with big Vacation Rental PM last week. Booked each weekend in September, but at $340/night (well below my target for my 5 bedroom amenity packed home) and with my calendar wide open for future events I would have normally raised prices for.

Honestly, I don’t love the experience with vacation rental PM so far. I was expecting more value for 15% than lower rates + open calendar.

Where I need advice:

With my little income from the investment property (so far) + personal debt-to-income ratio, I'm pretty sure I'm tapped out for another conventional loan. For those who scaled past property #1 or #2, what creative financing strategies worked best? (Private lenders, partnerships, subject-to, DSCR loans?)

• What has worked best for you when bookings start slow, even with professional design and good reviews? Given the current climate, how do you stay creative or is this something you're used to? Any advice for improving bookings without racing to the bottom on nightly rates?
• And longer-term, do you have or know of any STR owner groups (local or virtual) that meet regularly to share referrals, vendors, and support? I’d love to join or even help build one.

What has worked best for you when bookings start slow, even with professional design and good reviews? Given the current climate, how do you stay creative or is this something you're used to? Any advice for improving bookings without racing to the bottom on nightly rates?

And longer-term, do you have or know of any STR owner groups (local or virtual) that meet regularly to share referrals, vendors, and support? I’d love to join or even help build one.

I want to buy STR #2 this December to stay on track for my 4-in-4 goal. Right now it feels like I'm moving slower than I'd hoped — but I still love hospitality, believe I can get there with the right adjustments and I want to find a sustainable path forward.

Would love to hear your experiences, what’s worked for you, or even hard truths I should consider. And if you’re also building in the STR space, I’d be glad to connect.

—Lauren

Jeremy Horton · Answer

How much is your STR making currently? What's the ROI like?

I would consider a pause on STR #2 until STR #1 is operating well. It sounds like it is not doing as well as you anticipated. Quality > Quantity. A lot of people seem to have this obsession with door count or AUM - don't be one of those people. Your goal is likely income and overall ROI. The number of doors is really a meaningless metric.

That being said DSCR loans are the most common - but generally the rates/terms will not be as good as a conventional loan. So you need to underwrite even more conservatively. So if #1 is not working as well as you thought with a conventional then #2 would likely be worse with a DSCR loan. When did you buy this property? What's your interest rate?

Have you read "Short Term Rental, Long Term Wealth"? It's a good one, BUT a lot of their STR success hinges on self management. Consider self managing. Look up your vacation spot on AirDNA (if I remember right) and see what the ADR/income is for that area. Then analyze your property against these estimates.

John Underwood · Answer

So what is your NET income (or projected Net)? Especially after paying for all the training and services you bought.

I would make sure this property is making good money before buying something else that isn't performing like you hoped.

STR's are not performing great in many markets right now, so the timing might not be great for the first property and definitely not good to force a second one right now.

There are markets that are performing better than others but AI keep hearing that many STR owners are struggling right now.

If you are going to buy a second property, make sure you run the numbers and be conservative with them to make sure you have a buffer.

Maybe consider a smaller cheaper property for your next one that appeals to the bargain shoppers and smaller families.

I also love my LTR's that I buy cheap and fix up. It is very good to diversify via different property types, different markets etc.

People always need a place to live but may dial back vacations if there is financial uncertainty in their personal lives.

Trent Reeve · Answer

a few things. I love the enthusiasm, but i think the goal of 4 STR's in 4 years without a lot of investment money is a bit too ambitious.

And unless you have a great deal or great property in location with little competition, when you first start your chance of making the most money would be through self-management. There are some good property managers on here that are valuable, but for most of us we self manage to keep that 15-20% in our pockets. Also, do you own the listing the PM is using? if you left, do you lose all the reviews on your property?

It's a bit of a game and you have to play it. I might be in the minority, but you need to get your property to show up in algorithms. Get some friends to stay at your place, put in that new property/first guest discount, get people in there and get some reviews. People dont need to stay at a property with 100 reviews, but I would say you are good once you get at least 5-10 reviews. Make sure your exit process with guests encourages them to post review of your property.

Lauren Kormylo · Answer

I agree with others, don't buy another property until you get this first one figured out.  Bookings are often slow when you first start out, but you want to decide whether you made a mistake with this one.  Is summer the high season there, or will winter bookings be better?

Go to Airbnb, Vrbo, and the PM's site if they have one, search on their maps in "incognito mode" to see if your place is showing up to guests like it should.  Try putting in dates in the calendars as if booking, see if everything is working.  If not, contact the platform. Make sure your calendar is open far enough ahead.  I've seen some hosts who only have it open 3 months ahead, and a large place like yours needs to be open 9 months to a year ahead.  You're catering to extended families who have to coordinate vacations far in advance. I hope those guests who stayed gave you reviews, and 5 star ones at that?  I don't have to ask for reviews, because I have one of these magnets on the fridge, which really encourages guests to give them automatically.  https://www.etsy.com/listing/1180679049/short-term-rental-ra...  And after 3 years of hosting, I have all 5 star reviews.

Try joining local Facebook groups for STRs or vacation rentals, where guests are posting requests for places to stay. Spend some time searching with different wording on FB for vacation rental groups in Texas and also in your town or area.  If a group lets you create a post advertising your place, do that.  And also respond to guests' requests if your place is a good fit.  I've gotten some guests from those pages, and it increases your visibility so that even if someone doesn't book then, they might remember you in the future. You might also find a local group for hosts on FB, I have one in my area.

Do you allow dogs?  I started out not allowing them, but dramatically increased my bookings when I reversed that (I still don't allow cats).  Now 30-40% of my guests bring dogs.  I charge $150 per stay for one or two dogs (and will allow a third if they ask), and $30 of that goes to my cleaner for the extra work.  That is an additional profit center for me, I make money on it.

Jay Hurst · Answer

I have new investors that call me and excitedly tell me they have a plan to buy 20 home in the next 2 years or whatever it might be. and that is great to have goals. But, you have to understad whjat the heck you are doing before you get your self in to deep that in all falls in on you.

Do not buy a second property just to stay on a schedule that you created without any experience. Get your first property operating at a profit before even think about buying another one. There is very little scale to owning two properties so very little advantage but double the risk. If both properties are losers, then you are in danger of losing the both and torpeoding credit.

Rick Pozos · Answer

Hey @Lauren Lockett as mentioned above, you need plenty of stays for the algorithm to see that you guys are great. That also means plenty of reviews. I know this might sound tough, but maybe until the end of the year, lower your rates for during the week to $200 or $250 per night. Get some traffic. Make sure the day before checkout you let the guests know that you would appreciate a 5 star review of the property. Ask for a great review.

Chris Howell · Answer

@Lauren Lockett

Congratulations On taking the leap first one is the scariest one.

$980 per month for a 5 bed seems very low and like you will be losing alot of money ounce you add in electricity, water, sewer, internet and your taxes and insurance and debt service.  I would try and see how to decrease vacancy rate before looking at buying another property Increase your GOI.  If you have it rented 15 days at 225 compared to 8 days at 300 which gives you more revenue and higher cashflow.  Give your customers more for less and establish a good reputation and then increase you rates.

Michael Baum · Answer

Hey @Lauren Lockett, gratz on getting in the game.

I think you have a good idea of how to move forward...slower than you want but more solid. Don't want to grow too fast and then lose it all.

Are you on VRBO?  Remember that you own a STR, not an AirBNB. AirBNB is a platform.

Patricia Andriolo-Bull · Answer

What others have said. Goals are targets and need to be reevaluated based on where you are. I would slow down and do this one well and definitely dump the PM.

Andrew Steffens · Answer

I agree with Rick above.  I'd probably discount a bit further until you get 5-10 5 star reviews then start inching the price up.  That will help get you ranked higher and keep the bookings rolling in.  Good luck and good job!

3 Months into my newest Airbnb...still optimistically looking ahead! Thoughts?

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