HMW #147: The 5 Most Important Things About Your Short-Term Rental Business

Read Time: 4.5 minutes

Our favorite sponsors who help keep this content free for you:

Today's issue is sponsored by Jasmine Mortgage Team my preferred residential lender. My team and I have done over 83 deals directly with Jasmine and her team. Work with someone that understands real estate. Book a free 15-minute consultation with Jasmine today. 

Screen your tenants, run background checks, and search up criminal history of your tenants and applicants using TransUnion SmartMove. Free for landlords to get all the information they need at tenant screening. Test run your next rental applicant at TransUnion SmartMove.

It's fun to go on vacation and fantasize about owning beachfront property or a ski cabin on the slopes. It can't be that hard, right?

Well, we exist to (hopefully) make your success a little more lucrative. And today Lauren and I (Alan) are going to break down the 5 most important things you need to understand about running Airbnbs and Vrbos.

You okay with a little tough love on what the real secret of success is here?

Then you have the makings of a great short-term rental host! Let's get to it!

Thing 1: It's more than real estate investing

Sure, you are buying real estate, getting a mortgage, and owning property when you getting the short-erm rental (STR) game. But really it's a hospitality business:

You provide an experience, not a property.

You host, not property manage.

You have guests, not tenants.

Understanding you are running a mom-and-pop hotel (and your competition is other mom-and-pop hotels and real corporate hotels), you'll understand the expectations than are in front of you.

Guests want something similar to a hotel experience, but not in a hotel district. They want to feel like a local, but live like they are on holiday. It's a balancing act for you as a Airbnb/Vrbo host and you have to act accordingly.

Ok, you are a good learner. Glad to see it.

Thing 2: Systems are good for both the host and the guest

You will quickly burn out as a host without consistent processes and systems in place. Your guests also want to feel comfortable by having clearing defined house rules, check-in and check-out procedures, and access to FAQs of staying in the home.

The best system is the one that works for you. And your goal is to give every single guest have the exact same experience. That's how you know you have implemented a sustainable system that works for both parties.  

Yes, that's the idea. You are picking up exactly what I'm putting down. Beep, bop.

Thing 3: Never stop analyzing your market

This is important. Your market research doesn't stop at purchase.  All the number crunching you did up front to figure out average length of stay, average daily rate in your neighborhood, and the amenities of competitors is an ongoing task that should be revisited at least each quarter. STRs are not a set-it and forget it product of real estate investing.

You obviously want and need to stay relevant and this ongoing research is what it takes. You may want to also check out our previous blog on what it takes to get more bookings to go along with this.

Exactly!

Thing 4: Treat your extended team very well

Short-term rental investing is not solopreunuership. It takes a team. In order to rise to the top, you must treat the people who work for you very well. We are talking cleaners, landscapers, and maintenance workers who collectively will make or break your business. Furthermore, they’re choosing to work for you as much as you’re choosing to have them work for you. Make sure they feel valued. And pay them what they’re worth, at a minimum.

Probably not, but that's not my point. You aren't asking for help to get attention from others, you form a team to create a better product and reduce your workload. Hosts, guests, and your extended team all win that way.

Thing 5: Reviews trump everything

Feedback and reviews are the most important thing. Not all feedback comes in the form of reviews. When you hear something once or twice, or when you start getting questions you didn’t used to get, make changes. Notice when people stop mentioning cleanliness in their reviews, or when they stop mentioning communication. Everyone looks at reviews and they will make or break your business. You are only as good as your recent reviews, so make sure they're stellar.

All this makes sense, right? And as my guest today, may I ask how would you rate this list of 5 important things to know about the short term rental business?

Alright, you aren't the big girl you claimed you were at the start then.  

Summary

• It's a hospitality first, real estate second business
• Reviews matter tremendously
• Form a team of winners
• Research don't quit
• Systems for the win