Property Manager · Wisconsin and Florida · Member since 2017 · 346 posts · 227 votes
What have been your hardest lessons learned in short term rentals? I'd be curious to hear the experiences that others have had. I'd say my hardest lesson learned is overestimating how quickly a new property will reach my revenue goals. I haven't allowed for much of a ramp up period and as a result, haven't budgeted the funds to cover the expenses in the beginning. I'm getting much smarter now though. How about you?
Rental Property Investor · Castle Rock, CO · Member since 2017 · 335 posts · 387 votes
7y
I learned Julie's lesson about WiFi passwords quickly. Stick with defaults.
HVAC systems are a pain in the ***. If it's old, replace it the day you close.
I thought people would like my fancy touch-screen Ecobee thermostats but they have trouble with them and they're not as easy as Nest. I'll buy Nest next time. But I do like the WiFi remote-control aspect. I also have remote-control door locks, cameras, and motion sensors. I love them all.
Linens are expensive, and you need three sets
Guests are hard on linens, you'll be replacing them on a regular basis
Guests will call the "Emergency Number" a.k.a. my cell phone, for stupid stuff like "how do I use the spa?". I learned to use Do Not Disturb on my phone very quickly.
Your cleaners are your best friends. Get a good one and treat them well.
It's not "passive income" like they say. It's a hospitality business and it's a lot of work in the beginning -- like several hours every day after work for months, then it settles down then takes maybe 3-4 hours a week. But if done right, the returns are WAY more than most people make on LTR's.
@Marian Smith @Wendy Schultz
I was just looking for some extra income. I had no idea how successful it would be when I started. I already had a room and a bed so I didnt have many startup costs- i just bought some new towels, sheets and pillows and put my room up to see how often it would rent out. I marketed to people traveling I40 by saying I was just off the interstate in the title. Others may have a different experience but most of my guests say they chose my spot because the hotels were way too expensive and they would rather drive a little away from Nashville to save money. I would say hotels are direct competitors for me and if my prices were much closer to even the low end hotels/motels my first timer guests would have probably stayed there because they are more comfortable in a hotel until they get used to a private room Airbnb. You could hop on Airbnb to see how many private rooms are in your area and see how many reviews they have to get a feel for how popular the area is for Airbnb. More than 10 reviews on many of them probably means it’s a good spot. No Airbnb’s in the area is also a good thing for you because it may mean you’re the one place airbnb users will go when they are in the area. So take the number of rooms and reviews in your area with a grain of salt. With a private room the costs are minimal to get started to test and see if it works then you can improve it if you’re getting guests.
Rental Property Investor · Stewartsville, NJ · Member since 2016 · 418 posts · 280 votes
7y
Biggest lesson learned is to have pictures of your TV and DVD remote controls on your phone, so that you can reference them when trying to explain to a guest how to use them. Also, create pages in your Welcome Book that have pictures of the remote controls and explain exactly the sequence of buttons to press to use cable, DVD, or the game system. After you create the instructions in your Welcome Book, have a couple of friends try it out to ensure you did not miss any steps. This will save you many hours on the phone walking people through how to use it.
Biggest lesson learned is to have pictures of your TV and DVD remote controls on your phone, so that you can reference them when trying to explain to a guest how to use them. Also, create pages in your Welcome Book that have pictures of the remote controls and explain exactly the sequence of buttons to press to use cable, DVD, or the game system. After you create the instructions in your Welcome Book, have a couple of friends try it out to ensure you did not miss any steps. This will save you many hours on the phone walking people through how to use it.
Investor · The worst town to live in, KS · Member since 2016 · 4k+ posts · 4k+ votes
7y
@Taylor Tapp You are sort of doing what I do, but on a smaller scale. You are doing well.
@Mike Shemp That's a great idea. I have Roku's, Smart TV's and Steaming BluRays in the combination of 24 STRs. Last week I had and engineer tell me he could not get the BluRay player to work. I went there and saw that the HDMI input on the HDTV was plugged in to input #1 and #3. The HDTV was plugged into itself. I told the guy "You must not be an electrical engineer."
Investor · Milpitas, CA · Member since 2015 · 71 posts · 72 votes
7y
Biggest lesson is to never, ever get complacent with your team when you outsource stuff. And don't get complacent with yourself.
Background: We do a lease-sublease model (we pay landlords rent, then we furnish it and sublet it back out for the spread). But 3 weeks ago, some tenant installed a hidden camera in one of our unit's bedroom.
Airbnb banned all 14 of our units and overnight all of our winter vacancies were cancelled. We're responsible for about $30k/mo in rent (losing about $1k/day). So that's pretty great.
Lessons learned:
Just because your cleaners do very well and make everything spotless in the beginning doesn't mean they will in the future (found some trash left behind a cleaning in a post mortem checkup)
Comb your place for hidden cameras and other things your guests can leave behind. It sounds paranoid, but if you're dependent on a platform like Airbnb to do most of your bookings like we do, the .1% of time these things happen can and will completely wipe out your business. Overnight.
Don't rely on one platform. We got a ton of bookings thru Airbnb and we stopped marketing as hard on the other platforms. We got complacent.
Don't be complacent. Every little detail matters. People are entitled and selfish in general, so make sure your last cleaning is as meticulous as the first cleaning when you still cared a lot.
Biggest lesson is to never, ever get complacent with your team when you outsource stuff. And don't get complacent with yourself.
Background: We do a lease-sublease model (we pay landlords rent, then we furnish it and sublet it back out for the spread). But 3 weeks ago, some tenant installed a hidden camera in one of our unit's bedroom.
Airbnb banned all 14 of our units and overnight all of our winter vacancies were cancelled. We're responsible for about $30k/mo in rent (losing about $1k/day). So that's pretty great.
Lessons learned:
Just because your cleaners do very well and make everything spotless in the beginning doesn't mean they will in the future (found some trash left behind a cleaning in a post mortem checkup)
Comb your place for hidden cameras and other things your guests can leave behind. It sounds paranoid, but if you're dependent on a platform like Airbnb to do most of your bookings like we do, the .1% of time these things happen can and will completely wipe out your business. Overnight.
Don't rely on one platform. We got a ton of bookings thru Airbnb and we stopped marketing as hard on the other platforms. We got complacent.
Don't be complacent. Every little detail matters. People are entitled and selfish in general, so make sure your last cleaning is as meticulous as the first cleaning when you still cared a lot.
Wow, such good insight. I hope everything turns around for you quickly!
Los Angeles, CA · Member since 2016 · 565 posts · 391 votes
7y
Doing great in a couple markets and ignoring you can go wrong in a new market. Hot markets may also be the most competitive forcing you to be less profitable as expected. Find the balance between a good market and the number of existing STRs as well as the barrier to new entrants in that market.
Rental Property Investor · Stewartsville, NJ · Member since 2016 · 418 posts · 280 votes
7y
@Paul Sandhu - Haha you can't make this stuff up. I've spent too much time on the phone trying to explain the remote. But you just gave me another idea, and that is to label the wires, and the ports and take a picture and put that in the book in case someone, pet, children, etc. unplugs the wires and then I get a phone call on how to hook them back up. That's going into the book next!
Rental Property Investor · La Quinta, CA · Member since 2014 · 1k+ posts · 779 votes
7y
Before I took property management in house, we had a noise complaint that the police responded to. It resulted in a ticket written to me the homeowner. When the ticket was processed as a noise complaint at a vacation rental, the City noticed our short-term rental permit was not renewed on time (that was the responsibility of the property management company i fired shortly thereafter).
As a result, a criminal charge was filed against me, and I was due in Court (alongside lots of drug charge cases while I waited my turn). While a few thousand in legal bills and fines allowed me to avoid having that appear on my record as a criminal conviction, it was a rather unpleasant experience and I lost a lot of sleep those weeks.
But hey, we manage everything ourselves now, and the house will do $400k+ in gross rents this year, so maybe it was worth some lost sleep.
Chicago, IL · Member since 2014 · 2 posts · 0 votes
7y
@Wendy Schultz what was your ramp up time to profitability? And what city are you in? I'm looking at getting an apartment to do STR in Chicago and this I am realizing I haven't considered this variable much. I anticipate 2-4 weeks of prep time for me to furnish and set up utilities. Any more advice you could offer on that hurdle would be great!
Real Estate Broker · East TN Loudon/Lenoir City/Tellico Village · Member since 2014 · 363 posts · 222 votes
7y
Lessons with my rentals
1) When the description says Rustic don't include Resort with pool. Guests expect a fancy resort with pool and then they arrive and find a Rustic cabin in the woods and leave a 3 star review for not being fancy enough. - Make sure descriptions visualize the property and not just describe the elements.
2) LOVE having adventure properties - I have 2 cabins that are a 4x4 adventure to get to but VIEWS are outstanding. I almost backed out of deal due to road issues.
3) Lastly STAY on top of deferred maintenance! Do not get complacent and expect your cabin to be in the same awesome condition when you last saw it 3 months ago. Have a checklist of all the little things It really really makes a difference for quality reviews and return guests.
4) Tip cleaners and make sure they know How appreciated they are for being your eyes and ears on the ground.
Real Estate Investor · Houston, TX · Member since 2016 · 142 posts · 79 votes
7y
Here is an odd one that we've come to learn -- not sure if we're the only ones who have experienced this. Other VRBO/Airbnb HOSTS seem to make some of our WORST guests. They've left the place dirtier than others, or they are just more of a nuisance. It's the weirdest thing.
So if the inquiry starts with "We're hosts ourselves so we will take great care of....." we roll our eyes expecting more trouble :)
Rental Property Investor · La Quinta, CA · Member since 2014 · 1k+ posts · 779 votes
7y
@Mark S. We've found that other hosts that own larger homes are great guests. Other hosts that don't own the home (they are simply rental arbitraging someone elses place) or that are only hosts for smaller places like a small apartment or condo, definitely not!
Investor · Thermopolis, WY · Member since 2012 · 4k+ posts · 4k+ votes
7y
I cannot say for other areas, but in my area when tourist season is over renting stops. I doubt if I had 5 renters between November and April last year. I didn't make enough to pay utilities. Now during the peak of the summer I was full for almost 2/3s of the month and made double, almost triple what the place would rent for by the month.
@Charles Kao you took the words right out of my mouth - sure you can offer your place at the lowest rate and keep close to 100% occupancy, but at what long term cost? It's definitely a fine line. In one of the condo complexes I own in, the gentleman above me charges ~$100/night more than the rest of the competition and he gets fewer bookings. But, he says he's ok with that as his unit is "premium" in both views and amenities, he makes enough income and his place isn't trashed.
Specialist · Grand Rapids, MI · Member since 2016 · 1k+ posts · 611 votes
7y
@Sam Craven
AirBNB does not do a good job of the age check so unless you are getting a driver's license you are praying they did their due diligence. I had a guest that said they had an ID verification on their AirBNb profile and once we got police report back it turned out that they were younger than my requirement in addition to not having same name as profile. AirBNB just verifies they upload anything even a fake ID they don't do anything else. If I knew their real name and googled it I could have seen their had been arrested for breaking and entering and destruction of properties multiple times. We still use AirBNB but even getting the security deposit is impossible because AirBNB does not even take it up front.
Specialist · Grand Rapids, MI · Member since 2016 · 1k+ posts · 611 votes
7y
@Mark S.
Are you actually verifying this or just taking them at their word? We have never had this issue and have hosted probably 30-40 other hosts including AirBNB employees.
Atlanta, GA · Member since 2015 · 38 posts · 28 votes
7y
A few from the last few years:
1. make everything standardized and as part of a process. I have king beds in all properties with the same linens, templated messages are sent out automatically, cleaning is handled by someone else, etc.
2. invest the money upfront to get nice things/ extra amenities. I think guests are more forgiving of some dust/hair if there is a lot of little nice touches.
Real Estate Agent · USA · Member since 2016 · 909 posts · 1k+ votes
7y
The hardest thing for us has been to learn that you just can't please everyone. We will get 10 5 star reviews in a row and then someone will give us 2 stars because they had to store some of their cans from the grocery store on the counter because there wasn't enough room in the cabinets for all their cans (This really happened. That really ruined your vacation?).
@Mark S. totally agree! Other hosts have been some of our most high maintenance guests.