New to Short Term Rentals - Banner Elk, NC

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New to Short Term Rentals - Banner Elk, NC

Rachael Wood
Member since 2020 路 5 posts 路 1 vote

Hi! Let me start by saying I'm completely new, out of my comfort zone, and scared to death. HaHa! We are under contract for a log cabin in Banner Elk, NC. This cabin will serve as a family getaway but also as a short term rental. We are looking to rent it enough to cover some --> all of the expenses of owning the cabin. It's a 2 bedroom 2 bath with a large loft. It's not fancy, but it's a nice log cabin. The property has long range views as well as a creek. My newbie questions are below:

1) This cabin sits at nearly 4000 feet in elevation. It does not have central air conditioning. We have the option of putting in a split unit if needed. For those who have short term rentals in high elevation locations, is air conditioning important in the short term rental world? 

2)  Pricing the nightly rate for this is stumping me. I've looked on Airbnb as well as VRBO for rentals in the Banner Elk area and the prices seem to vary wildly. We want to price the rental in a way that's attractive enough to keep our calendar pretty full but also not so low that we sell ourselves short. Any advice on pricing strategies? I did listen to the Avery Carl podcast and will review her suggestions - just wanted to see if I could gather more thoughts here. 

So far those are my burning questions. Thanks! :) 

Rachael 

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Paul CoxPro Member
Rental Property Investor 路 Manassas, VA 路 Member since 2013 路 194 posts 路 156 votes
6y

Hi @Rachael Wood

I'm a newby STR investor as well, also having worked with Avery and her Team in the Sevierville area. @Avery Carl and @Luke Carl and their team have really been helpful in steering me in the right direction with our cabin. We purchased back in Nov of last year, basically knowing no experience in the STR world other than that which we had read on the STR Forum. I also follow some STR sites on Facebook and have learned some good things there as well.  We self manage from Virginia. Is the cabin coming furnished or do you have to furnish it?

Our's came unfurnished, but we were able to negotiate a 15K furniture concession from the sellers at a local furniture store there in Pigeon Forge. That was Fun as the cabin was a blank slate and we got to furnish it with all high quality commercial grade furniture that should last for some time. 

Once you have it furnished or decorated to your style, do yourself a HUGE favor and get professional photos taken. I cannot overstate the difference it makes. We were having a booking slowdown after the low cost stays for the first 5-10 reviews were completed. I reached out to @Luke Carl to get his opinion of our listing on AirBnB and he so eloquently stated "Paul, your pictures suck" :) That motivated me to go ahead and hire one of the recommended local photographers for about $250 to do a photo shoot and WOW, what a difference. It has paid for itself and much more!

Check your competition in the area or as Luke says, check what the enemy is doing around you with regards to similar size cabins being managed the same way you plan to manage yours and then price accordingly. We haven't gone with dynamic pricing yet as we just do what I was told to look at and price that way. It can be a chore and maybe we'll look at that once this first year is under our belts.

We list with AirBnB, VRBO and Houfy.  99% of our bookings come from AirBnB which is why we put up with their current site management style for the time being.

We always honor our pricing on the sites even if we made a mistake and missed an opportunity to raise prices. Truth in Advertising if you will. Maybe Dynamic Pricing will help us avoid mistakes like that.

Your cleaners will be your Godsend, so choose wisely. Interview as many as you can and go with your gut and the recommendations of others. They will be the ones that get you to Super Host!

It's been a blast learning the business, even with the temporary bump from Covid...We're ready to get another cabin because this has been a Cash Machine!

Good Luck and yes to what everybody else has said as well!

Paul

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  • Mike Anderson
    Rental Property Investor 路 Clayton, GA 路 Member since 2020 路 186 posts 路 152 votes
    6y

    I preface what I'm about to say as I am new as well but ive been spending every day learning and reading while I work with Avery's team picking up my first rental. So with that said here is my advice:

    1) If you look at Airdna for banner elk you will see that the number 1 listed amenity is Air Conditioning. I took a snap of the amenities for you to see. What basically everyone says is if your competition has it, you need it too. 

    2) Most of the reading i've done and recommendations from folks is to use a dynamic pricing tool. Pricelabs seems to be the most popular. I'm pretty convinced at this point that this is the right path for multiple reasons to include that the price changes that it does to adjust will also help you raise in the rankings because of a change to your listing.

    With that said we really like the Western North Carolina side of the smokies too, we have discussed leaving Atlanta for there as our permanent residence. It doesn't seem that side of the smokies does as good from an investment standpoint as Seveirville area, but the question is can you make enough to cover expenses and I just don't know. Right now we want the best investment possible. I'm no expert but I hope this helps a little. I know there are a few folks around that do more in WNC but they have been hard to get a conversation with. 

    2Reply
  • Rachael Wood
    OP
    Member since 2020 路 5 posts 路 1 vote
    6y

    @Mike Anderson, this is excellent! Thanks so much! I'll dig into Airdna and Pricelabs. Here's to newbie success! :) 

    0Reply
  • John UnderwoodPro Member
    Investor 路 Greer, SC 路 Member since 2014 路 13k+ posts 路 17k+ votes
    6y

    I would say you absolutely should invest in a HVACV unit.

    Price you unit on the low side just to start with. This will get you books, visibility and the all important reviews.

    After you have 10 or so 5 star reviews and substantial bookings start raising your rates. Vrbo has some great analytical tools to see what demand is as well as booked and un-booked prices for any day on the calendar. This will help you more accurately adjust pricing. I tend to go higher than the average booked prices as I have over 100 5 star reviews and can demand a higher price.

    1Reply
  • Paul Sandhu
    Investor 路 The worst town to live in, KS 路 Member since 2016 路 4k+ posts 路 4k+ votes
    6y

    How will you clean and restock it between bookings?

    0Reply
  • Rachael Wood
    OP
    Member since 2020 路 5 posts 路 1 vote
    6y

    @John Underwood, thanks for that information. I'll check out VRBO's analytics and start pricing AC units. @Paul Sandhu, we are working on all of those details. Nothing in place yet. We are under contract now and will probably take care of those details as we get closer to closing. 

    0Reply
  • Michael BaumPro Member
    Olympia, WA 路 Member since 2016 路 8k+ posts 路 7k+ votes
    6y

    Hey @Rachael Wood, looks like a nice area! There is a lot of competition in the area. 2BR/2BA log cabins are pretty steady at an average of $135 a night depending on the location.

    I have to say that the home prices are quite high for the sqft, so depending on what you are paying for the place, this will be tough to cashflow.

    Have you looked into furnishings etc? There will be an expense there as well.

    0Reply
  • Paul CoxPro Member
    Rental Property Investor 路 Manassas, VA 路 Member since 2013 路 194 posts 路 156 votes
    6y

    Hi @Rachael Wood

    I'm a newby STR investor as well, also having worked with Avery and her Team in the Sevierville area. @Avery Carl and @Luke Carl and their team have really been helpful in steering me in the right direction with our cabin. We purchased back in Nov of last year, basically knowing no experience in the STR world other than that which we had read on the STR Forum. I also follow some STR sites on Facebook and have learned some good things there as well.  We self manage from Virginia. Is the cabin coming furnished or do you have to furnish it?

    Our's came unfurnished, but we were able to negotiate a 15K furniture concession from the sellers at a local furniture store there in Pigeon Forge. That was Fun as the cabin was a blank slate and we got to furnish it with all high quality commercial grade furniture that should last for some time. 

    Once you have it furnished or decorated to your style, do yourself a HUGE favor and get professional photos taken. I cannot overstate the difference it makes. We were having a booking slowdown after the low cost stays for the first 5-10 reviews were completed. I reached out to @Luke Carl to get his opinion of our listing on AirBnB and he so eloquently stated "Paul, your pictures suck" :) That motivated me to go ahead and hire one of the recommended local photographers for about $250 to do a photo shoot and WOW, what a difference. It has paid for itself and much more!

    Check your competition in the area or as Luke says, check what the enemy is doing around you with regards to similar size cabins being managed the same way you plan to manage yours and then price accordingly. We haven't gone with dynamic pricing yet as we just do what I was told to look at and price that way. It can be a chore and maybe we'll look at that once this first year is under our belts.

    We list with AirBnB, VRBO and Houfy.  99% of our bookings come from AirBnB which is why we put up with their current site management style for the time being.

    We always honor our pricing on the sites even if we made a mistake and missed an opportunity to raise prices. Truth in Advertising if you will. Maybe Dynamic Pricing will help us avoid mistakes like that.

    Your cleaners will be your Godsend, so choose wisely. Interview as many as you can and go with your gut and the recommendations of others. They will be the ones that get you to Super Host!

    It's been a blast learning the business, even with the temporary bump from Covid...We're ready to get another cabin because this has been a Cash Machine!

    Good Luck and yes to what everybody else has said as well!

    Paul

    3Reply
  • Michael BaumPro Member
    Olympia, WA 路 Member since 2016 路 8k+ posts 路 7k+ votes
    6y

    Hi @Paul Cox, I don't use dynamic pricing. The reason is similar to yours. I hate it when the rate listed in the search is all of a sudden 2x more when you go to book. Bugs me to no end. I leave it at a flat rate all year long.

    @Rachael Wood you will have to decide for yourself. Most people here use dynamic pricing and they manage to squeeze a few more dollars out of their investments. It is all just personal opinion.

    Also I use my photos and didn't hire a pro. I have a good camera but I don't retouch anything. I think the photos look good and we get compliments on the place. Better than the pics! Personally I would rather have people say that rather than "Looked better in the pics". I have been giving it serious thought though. I think my framing could be better. You guys be the judge:

    0Reply
  • Joseph Bafia
    Investor 路 Raleigh, NC 路 Member since 2019 路 314 posts 路 280 votes
    6y

    Rachel 

    Congrats on being under contract. Your story is similar to ours in that we bought our first place as a true 2nd home getaway and it wasn't until we found we didn't use it all the time, that maybe we could try and rent it. The rest is history. Once we listed (March 2019), it's been booked solid all year. Only hiccup has been Covid where county stopped STR from April to Mid-May. Once restriction was lifted, back to full occupancy (at even higher rates).

    I will tell you we are north of Asheville at 4400' elevation.  I don't discount what other mention about AC, but we don't have it.  70%+ of home in our community don't have AC as the few days in the summer it gets hot don't outweigh the cost and windows open and fans get it cool enough.  

    AirDNA also tells me that that in my zip code, AC is the #1 amenity...yet we have 49 reviews and a 4.9 Star rating.  Not sure where they got their data on that one.  My suggestion is to determine what the others home have.  Ask questions of permenant home owners with how hot it gets and if they have AC.  Just do your homework.

    Its always interesting to hear how various owners get their bookings.  We are 95%+ VRBO (listed on AIrbnb).  We price manually.  We had no idea what we were doing this first few months (really first year), but we've got our groove.  We know weekends are higher, holiday are big, make sure you have minimums in place for busy periods.  We've seen the pattern where our bookings are 80% 1-2 months in advance, I don't panic until about 3 weeks out to start adjusting rate.  My son and I periodically peek at them and adjust as needed to maximize.  


    Good luck with Banner Elk as we love that area too!

    1Reply
  • Paul CoxPro Member
    Rental Property Investor 路 Manassas, VA 路 Member since 2013 路 194 posts 路 156 votes
    6y

    @Michael Baum...Here are my photo's next to our pro photographer's photo..1st one is my photo...I do not claim to be any type of photographer, though I'd like to be :)

    0Reply
  • Paul CoxPro Member
    Rental Property Investor 路 Manassas, VA 路 Member since 2013 路 194 posts 路 156 votes
    6y

    Now here's my Professional Photographer's shot

    0Reply
  • Paul CoxPro Member
    Rental Property Investor 路 Manassas, VA 路 Member since 2013 路 194 posts 路 156 votes
    6y

    And then the one I use for my listing profile photo

    1Reply
  • Michael BaumPro Member
    Olympia, WA 路 Member since 2016 路 8k+ posts 路 7k+ votes
    6y

    Hey @Paul Cox, the original photo doesn't look like garbage. The photog pretty much just lightened up the pic. Looks good though!

    0Reply
  • Luke CarlPro Member
    Rental Property Investor 路 Tennessee Florida 路 Member since 2016 路 4k+ posts 路 5k+ votes
    6y

    @Paul Cox. Yes I agree with @Michael Baum that first pic isn鈥檛 horrendous but the rest of them must have been pretty bad if I said something lol.

    Pricelabs all the way. It takes a good chunk if time to set up and get to know, but I totally love it and I鈥檓 pretty nuts about pricing.

    Podcast Guest on Show From Surviving on $30/Day to 30+ Properties Thanks to Blue-Collar Skills
    1Reply
  • Rachael Wood
    OP
    Member since 2020 路 5 posts 路 1 vote
    6y

    WOW! Waking up to all this great advice is wonderful! I can see that this community is going to be a real asset as we get started. Maybe we can return the help on the flip side once we know what we are doing! :) 

    @Michael Baum you are correct, home prices are high and houses are flying off the market like hotcakes. We will have to furnish the entire home. I suppose there's good and bad about that. The expense will be large, but we will have it just the way we want it. As far as dynamic pricing goes, I think that's something I'll have to check out once we own it and have it listed on the rental sites. I tried to utilize some of the pricing tools, but since we don't have an actual listing posted I didn't see a way to get the pricing tools to work. 

    @Paul Cox thanks for the tip on interviewing several cleaners. Once we close I plan to spend some time at the cabin furnishing it and getting everything in place for housekeepers. We will also be sure to hire a professional photographer. I can see where that would be a real benefit. Where in VA is your home? Our son is getting ready to start school at VMI in Lexington. It's quite difficult to find a STR in Lexington. IDK, but maybe that's a good market to tap into as many families need a STR for both VMI and Washington and Lee events.

    @Joseph Bafia thanks for the AC tips! We believe AC isn't necessary at that elevation. After listening to the Avery Carl podcast we think that as long as we are clear about the fact that it doesn't have (nor need) AC we should be fine. We really liked the tips on that podcast about being upfront about the "imperfections" of a listing in order to avoid later concerns from a renter. As a research tool, I sent a message to an owner on VRBO who has a house listed in the area to ask about whether or not their home had AC. Interestingly, they just responded saying that it did not have AC without further explaining that it really isn't necessary or in any way trying to make me feel better about the fact that there is no AC. I would think that when responding to potential renters it would be vital to be a good communicator. 

    @Luke Carl please tell Avery that her podcast was outstanding and is really one of the big factors that pushed us over the hump in purchasing our cabin. :) I tried to use Pricelabs but found that I couldn't really utilize the tools until I had a real listing on one of the rental sites. Am I missing something? Also, does Pricelabs help with keeping the booking calendar updated? One of the things I'm curious about is when a house is listed on two different sites, how is the calendar kept updated. For example, if someone books your home on VRBO will you have to manually go in and update the AirBnB listing to reflect that those dates are not available any longer, or does something like Pricelabs do that for you? 

    Again, many thanks for all this help!! :)

    0Reply
  • Joseph Bafia
    Investor 路 Raleigh, NC 路 Member since 2019 路 314 posts 路 280 votes
    6y

    you hit the nail on the head with the observation of being a good communicator.  You should be very happy that the other VRBO owner gave you such a poor reply as that's your competition and will only funnel more business your way!  We too follow Avery's advice of making imperfections known.  We have a steep driveway, you need 4x4/AWD in the winter months, No AC, etc....all disclosed and we'd rather lose the deal over the renter knowing the facts than fight a bad review later.  It just happened yesterday that a renter inquired if we allow pets and if so, how good we clean after renter leaves since they have a pet allergy.  We responded politely but accurately that it may not be best to stay at our place and take a chance for their health reason.  

    Keep up all the great research and education!

    0Reply
  • Rachael Wood
    OP
    Member since 2020 路 5 posts 路 1 vote
    6y

    @Joseph Bafia excellent points! Best of luck! 

    0Reply
  • Paul CoxPro Member
    Rental Property Investor 路 Manassas, VA 路 Member since 2013 路 194 posts 路 156 votes
    6y

    @Michael Baum, trust me when I say that was one of the better ones we took馃檮

    0Reply
  • Paul CoxPro Member
    Rental Property Investor 路 Manassas, VA 路 Member since 2013 路 194 posts 路 156 votes
    6y

    @Rachael Wood, we live in the Manassas area, a little bit aways from VMI

    0Reply
  • Mark Lee
    Member since 2019 路 29 posts 路 15 votes
    6y

    @Rachael Wood, I was wondering if you have closed and started listing on airbnb?  Do you have a recommendation for a realtor?  We are interested in a vacation home in the sugar mountain area which is nearby.

    0Reply
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