Manage episode 252368727 series 67704
We are talking about making short term rentals happen for you, making them easier and faster, bigger, better, and badder. If you feel the need to get started and need that extra push to make things happen, you can go to cashflowdiary.com/roadmap to finally build your business. J reveals the 10 things he wishes he knew before he got started in the short term rental business as well as answers a number of questions from the viewers.
- How many units does it take to retire?
When you’re in pursuit of an outcome, you may not know what the goal is. When people are getting started in real estate, they often have a dream of retiring but have no idea how many units they need to achieve that goal. If you want to know exactly how many short term rental units you need to retire you can go to cashflowdiary.com/howmanyunits to calculate your magic number.
- Is it possible to get my first unit in the first month?
The most reliable answer is it depends. If you follow the program and do exactly what it says, you shouldn’t have any problems landing your first unit, it all depends on whether you are willing to put in the work and how comfortable you are with failing. You may have to hear a large number of ‘no’s’ before you get a yes, but if you can push through and put in the work, it’s definitely doable. You just have to move at the speed of instruction.
This program is best suited to people who are okay with leaving the ‘why’ for later so that you can provide value now. Even people who have been in the short term rental real estate world can get stuck if they don’t have a system for scaling and the tools and team to support their growth. It takes time to learn systems, but they can’t be implemented just by reading a book or watching a video. It requires hands on experience to make them work.
- Will we be able to plagiarize all the systems and everything you do in your short term rental business?
You not only get to plagiarize everything, the program literally contains the exact messages that J sends his guests. It’s easy to replicate the ingredients, but we also give you the recipe.
You need to learn more than just tactics. As the marketplace matures, you’re going to need to have the skills to build a real brand that will allow your business to continue growing.
- Do short term rentals work in Chicago?
The short term rental business works everywhere there is a need for housing.
- Is the app available to current students or only people in the Roadmap?
People joining the Roadmap get access to the app first but it will be coming to existing students that are currently in Facebook.
- Do I have to under price if I’m new?
You don’t have to approach this the way you would with traditional real estate, you would be doing things in the wrong order and costing yourself some opportunity. You also have to be aware of how difficult it is to get accurate data to set your prices and they can be manipulated.
- #10. I was not aware of the use cases for short term rentals
The real secret to the short term rental business is specialization. Who you are trying to serve will determine so much about your business and is really the foundation for everything else. There are a huge variety of specialized use cases for short term rentals that you can serve including mobility challenges, government, insurance, pet owners, and more.
You have to understand specialization. We are retailers, and retail is niche. You have to customize your business to suit a particular kind of customer right from the very beginning. Failure to do so will be why you average daily rate won’t be as high as it could be. There is no such thing as too niche, if you don’t niche down you make will all kinds of mistakes.
- #9. This business is very review based
You can do everything you were supposed to do and you can still get a negative review. It’s going to happen and you need to deal with it.
- Is $20k enough to start an AirBnB business?
We don’t have an AirBnB business, we have a short term rental business. It all depends on who you are going to serve, people have gotten started for much less and much more. There is no set number for everybody.
Just because you have money, that doesn’t mean you're going to succeed. Can you hear no fifteen times a day? That attitude is much more important than money.
- #8. I didn’t realize how political the business is
There are a lot of challenges in some jurisdictions. Some places really care, mostly because the perception of the short term rental industry is based on other people who haven't been doing the work.
- #7. How easy it is to operate the business from a distance
With the right systems, it can be surprisingly easy to operate a short term rental business from anywhere.
- #6. Established property management companies typically didn’t work
Traditional property managers just aren’t capable of doing certain things when it comes to short term rentals. Oftentimes the scale and scope of your operation will just be too much for them, which is why J developed and refined his own system to make it work.
- #5. How new the industry is
You can tell how new an industry is by the lack of software available. There is a huge amount of technology that just doesn’t exist yet for our use case.
- #4. How big the opportunity is around additional services
Having a system in place to consistently charge and collect for things like early arrival and late checkout can make a big difference in your bottom line. Being able to offer simple services like an additional cleaning can be huge.
- #3. The window is closing
In a lot of places the opportunity is still wide open but the window is closing. The time to build your brand is now. Major companies are making moves into the short term rental business because they see the same opportunity in the industry as we do.
- #2. How much energy people waste
Your guests will waste so much electricity it’s incredible. In 2019, J spent over $32,000 on utilities, and that doesn’t include the internet. That’s why they have developed a system that has almost completely removed that as an expense, which is available in the Roadmap training section.
- #1. How fundamental standard operating procedures are
Standard operating procedures that are written down and easily followed are the foundation for a business that can grow and serve hundreds of customers a month, all with one hour a day of work. There is a lot of work that goes into creating those SOP’s and members of the Roadmap get them just for being part of the program.
We are currently in the beginning stages of the short term rental industry and profit margins are good, which means the professionals are coming, and standards and expectations are rising. You absolutely need to have standard operating procedures in place if you’re going to compete in this business in the future.