All Forum Posts by: Paul Sandhu

A minimum 30 day rental seems rather strict.  What if someone will just be in town for 2 weeks?  Are you going to turn them away?  With my STRs, my minimum stay is 1 week.  They usually stay much longer than that.  Telling them a minimum 30 day rental is required may scare them off.

While my STRs are for people working outside, about 10% of the time I rent to someone that works in an air-conditioned or heated environment.  They are not that much different from each other. 

Basic requirements:  washer/dryer, linens, soap & detergent, Smart HDTV and wifi. 

My rule of thumb is to charge the same each week for the furnished rental as I would charge for the month if it was a normal unfurnished month to month rental to local residents..

I have a 4BR 1 block away from a high school and jr high.  No issues.  I have 4 more 2 or 3 BR's 2 blocks away from the same schools, no issues.  There is a soccer field in-between these last 4 houses.  Some of my tenants from the 4 houses play soccer with the general public in the evenings at that field.

I have 2 other 4 BRs 1 block away from a junior college dorm.  Those students are 18, 19 and 20 years old.  Other than the occasional sex party in the 3rd floor jacuzzi, there are no issues.

@Brandyn Kemp

I had the same thoughts as you about 6 years ago.  We had some 2 BR and 3 BR 1 bath STRs and realized something.  It's not the number of bedrooms in a house that determines how many people can stay there. It's the number of bathrooms with toilets and showers.

So we bought 2 houses on the same block, a 2 story and a 3 story.  15 real beds, 2 sofa beds, 6 bathrooms with showers and toilets, 4 washers, 5 dryers, 4 full refrigerators, 2 dorm fridges, 2 poker tables, 1 kegerator, 13 cable televisions, you get the idea.

The above 2 houses rent out, but not that often. When they do it's between $600 and $1200 a week. That kind of rent pays for the house in 6 months. It's hard to find a group of 5, 6 or 7 guys that will stay under the same roof in a STR. Each of the 2 houses make as much money as our 2 and 3 bedroom houses do in a year. If I could do it all over I would buy several 2 or 3 bedroom houses next door to each other or on the same block. Vacationing families can each have their own residence but still be next door or very close to the other vacationing family they are travelling with.

After we bought those houses, we bought 4 more that were on another same block.  They were all 2 or 3 bedroom.  They bring in as much each year as those first two houses, but the purchase price was about 40% less.

Think of retail.  You have high end stores like Macy's and the like.  Middle of the road is Walmart.  On the low end you have the dollar stores.

When economic times are normal, all three types of retailers do well.

When there is a downturn in the economy, the Macy's people switch to Walmart, and some of the Walmart people go to the dollar stores.

When the economy is good. Some Walmart shoppers may switch to Macy's, and some of the dollar store people will switch to Walmart.

So try to position your rental like WalMart is positioned in the retail market.  It will have its customers regardless of economic conditions.  It's just that the type of customer it has will change depending on economic conditions.

Here is a quick and dirty method I use to evaluate my short term renters:

I look at what they are driving and how well they have taken care of it.

Most of the time they are driving a full size truck with seating for 4, they have a $3000 lift kit, and it is clean.  These tenants I normally don't have any problem with.

If they are driving a dirty or dented or rusty car with not so new tires, I'm usually going to have problems.

Disclaimer, my tenants are all temporary workers at a refinery. Not vacationers.

@Jon Crosby

I have furnished 22 STR's with 82 beds. 95% of the furnishings I buy at estate auctions. A good rule of thumb is that a major appliance (fridge, stove, washer/dryer) can be bought for $125. A bed, frame, dresser and night stand should be under $200. A living room or dining room should not cost more than $200 to furnish. You'll also need sheets, utensils, towels, etc.

So there here is your formula:

FFE = [($500 + R x $200) x 1.10] x P

$500 is your 4 appliances.

R is your total rooms you are furnishing.

$200 is the cost per room.

1.10 is a 10% adjustment factor for purchasing small things.

P is a premium factor for items, e.g. luxury sheets, pillow top mattress, etc.  P is between 1.0 and 1.5.

My STRs are for short term workers at a refinery. A cheap basic motel is $350 - $400 here. That's my competition. A hotel with a pool, gym and breakfast is $700/week. Also my competition. My 2 bedroom units I describe as "Hamburger and French Fry" are $350/week. My 2 bedrooms I describe as "Steak and Potatoe" are $400/week. My pricing comes from my competition. I charge the same but offer more amenities and services than a motel. If it's a 4 bedroom house and we get $800 for several weeks my wife cooks them enough dinner for several nights.

@Luke Carl

What I'm trying to suggest is using Craigslist.  I agree, we are in 2 totally different markets though.  I looked at "Vacation Rentals" in the Craigslist section for where I live.  There were 4 ads placed in the last 45 days.  Looking at Nashville "Vacation Rentals", there were 20 ads placed yesterday.  7 of the 20 ads were specifically in Nashville.

Craigslist is free.  It takes about 10 minutes to place the initial ad.  It takes 10 seconds to bump up the ad.  Your ad would be one of the other 7 that were listed specifically for a vacation rental in Nashville.  If it doesn't work at generating rentals, you are out 10 minutes of your time that you probably would have spent on the internet anyway.

The town I live in is definitely not a vacation destination.  I am the only listing on AirBnb in this town, and I get about 2-3 inquiries per year.  None have generated a rental.

I do have ads running on Craigslist.  One every day in the "Apartments and Houses" for rent, and I keep one at the top of the list in "Sublets and Temporary".  If you list on Craigslist, you need to have 3 ads in that first category.  List an ad for 3 days in a row.  On day 4, bump up day 1 ad.  Day 5, bump up day 2.  

I get 1-3 inquiries per week from Craigslist.  Half of them are looking for a long term rental and they don't read the ad very thoroughly.  They think they can get a furnished, all bills paid house for $200/month.  I explain the $200 is per bedroom per week, so a 2 bedroom house is $400 per week.  That's about the time they apologize or hang up.  The other half are interested and usually rent if they end up coming to town.

@Michael Rutkowski

The way you decorate your places sounds alot like how I do mine.  My ideal rental would have 2 full baths, or at least a full and a 3/4 bath.  My renters have to bathe and use the toilet when they get off work.  3  bedrooms is ideal.  4 would be better, but in this town the real estate market is kinda funny.  A 4 BR house usually sells for twice the amount as a 3 BR house.

My living rooms all have a theme with the artwork.  The artwork theme can be action movies, Quentin Tarrantino movies, James Bond movies, ships, hunting dogs, duck hunting, deer hunting, sports, World War 2 Go USA propaganda, Clint Eastwood/John Wayne Westerns, Arnold Schwarzenegger, Rock Music, etc. 

About half of my artwork has been autographed.  It is movie poster boards. I have the entire  band Metallica, several Brad Pitts, Tom Hanks, the guys from Fast and Furious, Arnold S, Clint E.  Myself and my friends autograph them.

All my kitchens have several Marilyn Monroe, Scarlett Johansen or Cameron Diaz prints.  The female autographs are a little difficult for a guy to forge.

All my bedrooms have classy PG13 or R rated artwork.

I also make all the picture frames for the artwork.  It's usually with 1x2's and a table saw.  I sand, stain and urethane all the wood.  Cut it to proper dimensions and then make a frame.