The Beginning: My Short Term Rental Story
STR Journal: The Beginning
I started by researching municipalities in my local area that allow short term rentals. In my county, there are a few cities that had a pre-existing regulation on whether they welcome short term rental properties. I identified a market where there was not a preexisting
limitation for vacation rentals. Then, I started keeping an eye out
for properties in that area. I had an alert on my local real estate
apps, and I told my neighbors that I was looking for a property. A few
weeks into my search, my neighbor told me that she found a For Sale By Owner or FSBO house while she was biking in our neighborhood. This property was located a few blocks away from our own residence, and more importantly, it is firmly located in a municipality that does not ban short term rentals. I called the City Hall to confirm this, before I
began talks with the owner.
Frank was a disgruntled landlord, and was ready to offload a few of his properties. I was able to determine that Frank would be happy to receive his gains over time, to spread out his tax hit on the sale. We agreed that I would give him a sizeable lump sum up front, and then he would carry a mortgage back for me, at 6% interest only.
This situation also worked well for me, because I have a number of mortgages and prefer to avoid bank financing where owner-financing is a possibility. When talking to sellers I always ask if they would be like to avoid the Realtor’s commission, to defer their taxes, and to receive 6% interest on their money. Many sellers have been willing to be the bank for me, as it provides benefits for them, too.
Frank and I set a date for the closing, and he provided the opportunity to get my inspections done. The house had a newer roof, hot water heater, and air conditioning system. The kitchen was older, and as of the day of this entry and a few days after closing, I am getting quotes for new kitchen cabinets.
Right after closing, I went over to the City Hall with proof of ownership to open up a new water account, and called the electrical company to switch over power. If this house was on gas, I’d have done the same for the gas company. Because this house will be a rental, I will have the bills sent to my office and not to the residence. The next thing I have set up is lawn service, as one sure sign of neglect is an overgrown yard.
Changing it up from "rental" to "A Travel Experience"
I called my painter and had her come over to begin adding pops of color to the interior of the house. My designer, Lisa, came over to make an assessment of the light in the house, and to start creating a plan for the interior design of the property. We went together to start shopping for the furniture, and other interior furnishings.
As the kitchen goes in and we get closer to listing the house for rent, I will start to firm up color selections. I am reading reviews for mattresses and pillows, towels and sheets. It is important that items that touch the skin be of a high enough quality that they feel soft to the touch, but also hold up to multiple washings. We will be doing the turnovers ourselves at the start.
I had to make my first mortgage payment of $1500. Thinking about not replacing the kitchen, as it will save $13000. Have Tammy in to paint. Looking for sheets to buy and have some furniture in place.
Started to order pillows, sheets. Changed my mind and went to Sam’s Club for sheets, WalMart for pillows, high quality allergen waterproof mattress and pillow protector. Picked up 400 thread count sheets, white in these sizes:
Got white towels from Sam’s.
Picked out cutie kids' sheets, a play tent, "camping" supplies for the tent, and retro board games at Target. I swap all of this out when we have adults in this room.
Went shopping at Target. Got fleece throws for the foot of the beds, as well as light weight blankets. I got contrasting colors, to pop some color in the photos. Drove directly to Harland and started unpacking my car, and unwrapping items. It is 10:45 right now, and I am on the third load of laundry. I am doing each size bedding in its own load, so I don’t mix them. All 4 full sets of sheets went through, and the queen set with a few towels. I could only get one of the king sets and 2 towels into a load. I’m working to determine how much time it takes for wash and dry, using the machines at the house.
I’m still awaiting the deliver of the loveseat, and a few more items of furniture, that still need to be delivered.
I have mattress pads, but don’t want to put them on a bare mattress.
Later went back to put the mattress cover on, followed by a mattress pad, followed by sheets and quilts. I folded the white towels and placed a black washcloth at the foot of the bed.
I am getting excited about putting the first listing out there. I am aware that I have been taking “perfect” action, and now that our refinance has finished (aka money is available) I just need to take “positive” action. This is the difference between reading reviews and studying up vs actually creating a listing and getting photos ready. Even if it isn’t perfect, I need to get it ready.
First guest booked. Then Airbnb wrote me a letter saying a “rare” event had occurred and that they were closing his account. Following this, his father contacted me and asked to complete the same booking for the same amount of time. Thankfully Dean called me and told me that his children and grandchildren wanted to stay and that he was employed as a missionary to container ship workers. They did not want to throw a party, but just wanted to enjoy a family reunion. How odd.
Second group drove 20 hours from Texas for a softball tournament. Their 4 year old loves “his house” and was very happy to play with the toys we bought. I messaged them that I would take the trash out, and aimed not to bother them. They left the house quite dirty, and didn’t leave a review.
First Airbnb booking was 22 June. Here are the June 2019 bookings and their income: $586 + 11.97 + 10.30 + $504.77
Have my first VRBO guest staying from the 24th of July to the 2 of August. W will bring a party of 2 older adults, 2 of their children and 2 of their grandchildren. $2273.
Applied for a State license, because I saw a host stating that he was a licensed owner. I had done research, but hadn’t come across that yet. I knew the various municipalities could shut us down, and had applied for a tax number and account through the county about six months ago, well before I started looking for a property. I’m applying well after advertising and hosting. Fingers crossed that it all goes well. $220 to apply.
I earned some money and then went back to Walmart for new pots and pans (as I was using my used ones), night lights, bedside alarm clocks with USB chargers. The lamp next to the couch kept getting unplugged, and I think it is so people can charge their phones while watching TV. So I got more USB charging areas.
Still tweaking the photos, using the vivid setting on my iPhone for bright colors. I have followed some advice about photos, specifically setting the design of things in a room so there is an X, creating movement while centering the room between ceiling and floor. I make sure the lights are on for extra brightness. I have had a few comments about the bright orange wall, that it is memorable.
I have a theme, something I picked up from listening to the BiggerPockets podcast, which is also memorable. It dawns on me that people may search the local area for the Space Coast rocket launches, and find my unit (called Space Coast Launch Pad). That works for SEO. I filled out my welcome book, in a binder and pages in plastic page protectors, with catchy launch phrases and 🚀 rockets.
A word about my struggles:
When I get my next paycheck, I am going to buy an extra capacity dryer for getting the sheets and towels done faster. The cleaning takes about 4 hours, but the sheets take around 4 more. I plan on washing the mattress pads at the start of each month, which takes a lot of time. Additionally, we returned heavy comforters when it became clear the king sized comforters would not dry quickly. That decision motivated me to search Target for lighter, thinner quilts, which we then layer.
Finally got my license in the mail today!
Last thoughts on this new journey:
PHOTOS. Photos are such a big deal! Adding a lot of photos helps the algorithm to rank us higher. They catch the viewer’s eye, and begins to tickle their imagination. They lead the viewer to determine how their party will spend their time. Additionally, the number of photos and the order they are in is important. I have spent a lot of time looking at photos, editing for brighter colors. I noticed wrinkles in the bed skirt from looking through my already-posted photos and subsequently ironed them, because those wrinkles really showed up in photos.
Knowing the people want to click through rapidly, I put in bedrooms and kitchen in the first 10 available photo slots, and then walked through the house showing the best attributes. I filled up all the available photos for Airbnb as well as VRBO. I was also mindful of how the photos look on a phone, as well as whether they read well at a larger size. This is why we have those bright pops of color in this house. I wanted people to remember the first photo, so that they could return to it easily after viewing other properties.