7 Advanced Vacation Rental Investing Tips

Published by Darron Toy on

seven advanced vacation rental investing tips that's going to take your investing to an entirely new level I'm here with Brice and Julie Ann at their vacation rental here in the mountains I was coming to visit some of my properties and and as graduates of my program they've made a bunch of money over a half million dollars in creative real estate and now they're taking those profits and and buying some vacation rentals so thank you all for letting us get into this this problem of yours and so here's the deal I want to take y'all further in depth because I've done some videos on vacation rentals in the past but it's been a couple more years and I've got some more things to add for you some some things I've learned from the nitty gritty of being in this business and it just so happened that they were up here tommy worked out great so let's dive in tip number one is go big on furnishings alright so we're in sitting here at this nice table and what it's here in the middle of this okay I knew nothing about creative design or furniture or anything like that now rice might I didn't even ask him if he did but this is typically a female thing they see something like this they think it's cute they have to have it alright gentlemen here we go you have to let them buy okay I know that sounds crazy let them go crazy with furnishings on a vacation rental it makes all the difference in the world because it's the female but not only makes the decision on which cabin they're gonna rent or which house we're going to go to it also means that they're the ones that are most likely to give a positive review so it's tough for us guys you know we're trying to make a decision mathematically we're saying when we really need to spend a couple of hundred dollars on some what looked like some bears climbing on a piece of wood right and the answer is yes you do the more the merrier go big on furnishings it covers a whole loves deficiencies your property might have things like not a great view not a great location you know in the beginning that was my assumption and we have tested over many years and it's true the better the furnishings the better you're going to do and you can cover over a whole lot of cities with it and it also means that you've got to take a deep breath and when the creative female and your group decides that she wants to buy that crazy-looking lamp say yes people will love it they'll give you reviews on this kind of stuff I absolutely love the centerpiece they'll ask you where you bought it go for it go big on furnishing tip number two more bedrooms the better where we're standing right now is actually not a bedroom it's like a little loft and they were creative enough to find a futon but now that fits the space nicely but also goes out into a bed and this is so important you want to sleep as many people as humanly possible because what's going on right now is there's a war between the hotel industry and vacation rentals right the hotel industry is really upset with the way things have disrupted their machine and so what they're doing is they're trying to get government's involved to help with the land use laws to try to shut vacation realm owners down in the areas where the laws are ambiguous now in this area that's not a problem but the idea is the more bedrooms the more likely you can distance yourself and compete with hotels remember hotels they've got a restaurant downstairs they've got cleaning facilities they can call some sort of maid or maintenance person at any moment of time you're a vacation rental home you don't have some of those benefits but where do you win you win with the ability for people to all stay together as a family right everybody together and that makes all the difference in the world for you not only today but three years from now five years from now how do you compete against the hotel's more sleeping capacity and so in this case they were creative making a three-bedroom basically a four bedroom but I've got a I've got a seven-bedroom that does very well and I've worked with several other people at doing those bigger bedrooms and they do great as well so more bedrooms the better tip number three is you need to be on solid legal footing because if you're not it can be a real bear let me tell you I've been told to toe with with the land use and the zoning I've had myself some my properties because of it it can be a real nightmare to deal with but when you get the right area where a lot of the other properties might be illegal but yours is legal it can be a complete home run I've got a vacation run but I've had 130,000 for I've put a hundred thousand into the furnishings and the rehab so I'm in about by 230 I'm bringing in a net four thousand dollars a month forty-eight thousand a year net net net net after all expenses so when you do it right it can be a complete home run now certain areas it's not a problem at all you can just do vacation rentals and there's no concerns but that that is changing hotels are going to war and if you read the land use and the zoning rules correctly which I didn't like I wanted one of my areas in Florida was over six hundred and fifty pages and I'm going through each one and I'm looking at the pages and I'm I'm highlighting and I'm going through and I found the loophole find the loophole and it can be all the difference in the world and don't just rely on what you read online or when talking to a zoning or a land use person at the county office no go into the actual code do some reading it can be all the difference in the world but you have to be on solid legal footing because if you're not you can will be shut down I have an offense of like robberies it's not fun but when you do it right it could be all the difference in the world tip number four is that you need to stay in your properties or it's a friend or a family very close that you know very well needs to stay in there at least once a year if not twice a year and you might say but Phil you know if I get a vacation rental in this beautiful place I'm gonna stand there all the time in the beginning you will and then what's gonna happen is over time you're gonna stay in there less and less and the thing is only you know your property best you'll know the little things that nobody else knows and by going there you'll see and you'll notice people will steal your pots and pans they'll steal your utensils you'll see when things are missing better than even if you had a list for your your cleaning company so you need to stay in there and stay up to date now I have a lot of properties so how do I do it well I actually bonus my employees right and I say hey you can stay there for free with you and your family and part of the the exchange there is they need to make sure they do a thorough review of the property for me to see what's going on how things are coming along and they won't know exactly everything that might be missing but at least I'll get a good look at it and they'll do it from the perspective that's important for me to know what's going on so make sure you are getting in those properties at least once if not twice a year actually staying at tip number five is that you want to have more of your focus on home away in to a lesser extent TripAdvisor then with Airbnb so in other words you want to be very selective and less is more here what happens is this when you have a problem with a guest home away is very Pro owner and home away by the way is is VRBO as well they are going to side with human most cases whereas Airbnb they're gonna side with the tint now in the beginning that may not be a big deal but over time you start to see this stuff stack up and you can lose quite a bit of money from Airbnb in the way if they treat you as an owner they literally treat you like second-class citizens whereas whole way which is VRBO they treat you very differently they think you're the king and so that makes it a lot better from an owner perspective alright so less is more meaning I try to get all of my bookings from home away I still in some cases have an Airbnb listing and then I usually jack up the price a little bit and Airbnb to deal with the hassles that the platform for uh puts us through and then also I try to do the same pricing on TripAdvisor as I do for home away this TripAdvisor is kind of complement to home away in the way they treat you as an owner and this is only come from years and years experience right going through this and hearing my property managers say the phrase I hate Airbnb so this might be different for different kinds of properties both you're talking about large properties three four five bedrooms home away is your key and you know what if you optimize your listing correctly you really can get most of your bookings just from home away VRBO that's huge and it's not always the case but sometimes you'll have to supplement with one of these other two but when in doubt try to get all your stuff from home away much better platform to work with tip number six is that you want to have pricing I've talked about that in previous videos you want to tie your pricing to a dynamic pricing tool now the difference is this in my older video I talked about use wheelhouse and they're still great but they're only good for TripAdvisor and Airbnb they don't work with HomeAway anymore they I guess their connection separated they are never able to get it back so I use beyond pricing for home away and then I used wheelhouse for TripAdvisor and for Airbnb and what happens is by by making sure I keep up with the beyond pricing settings I know I'm maximizing my pricing and that makes all the difference for me to make the most money I possibly can now if you're using a service like evolve they're gonna take care of all this they'll take care of everything I'm talking about with step with this tip 5 and tip 6 but if you're if you're doing it on your own like I am and that the reason why I am is because I started way before I knew evolve and I I have great reviews on my listings and Airbnb and the home way won't let you transfer the listing to evolve so I wanted to keep that status so I you know I've trained a property manager and I've kept hold of everything but you wouldn't have to mess with this if you had evolved if you don't and you and you aren't being more manual like I am with my property manager make sure you're hooked up on these dynamic pricing tools they will ensure you maximize your profit and that can be the difference between making the profit margins you want and not tip number seven is go high on your cleaning fee this is an insider tip I learned the hard way no one taught me this this was something I just tested and it worked great so what's gonna happen is this first of all your cleaning fee comes out as they're in the process of checking out so you can go higher on that fee no one's gonna balk at it secondly if you go higher you have more money to pay for the best cleaners great cleaners make all the difference in the world I've talked about that in other videos here's the next thing by raising your cleaning fee watch this I don't charge a deposit and I don't charge for any other damage protection policy or anything like that so that you just get to book a lot of times they think they've kind of won 100 have the redeposit any damage control you might be thinking to fill younger damaged about what happens if they ruin the place here's what's gonna happen some of them are going to be jerks and they're gonna mess the place up but if you're charging let's say rather than 120 dollars for the cleaning fee if you're charging 190 for the cleaning fee that's an extra 70 dollars now times like 50 guests in a year that's a meaningful number it turns out I've been able to always stay ahead yes people are gonna steal some of your stuff they're gonna steal some of your pots and pans they'll steal some of these things and wonder what the heck they're stealing these things they're gonna do it right but when you have an extra two three four thousand dollars coming in did you jacked up their cleaning fee you have enough money to pay for all that stuff again it's worked for me for now five years and I've got a ton of vacation rentals I don't charge a deposit I don't charge any extra to require a damage policy and yet my stuff stays dialed in and I actually do better now I do think that ultimately over time with inflation if I have to break the $200 mark for the cleaning fee that's gonna be interesting I've never broke the $200 mark for cleaning fee but when I do I still think I'm gonna be okay because ultimately people are less likely to bulk on a cleaning fee than they are at your overall price so make sure that when it comes to the cleaning fee you jack that thing up and you use that extra money to cover all the problems that can come up all right now here's a bonus one all right I won't call this tip 8 this right here is the thermostat that came with the property they just bought it they had that rehabbers come in here and do some things to it and of course they're getting all the furnishings in and I noticed that that this is an old-school thermostat well you want to make sure you do is always get and they're already in the process they're ordered on Amazon make sure you get a Wi-Fi enabled thermostat that way you have more control and you know what's going on and what I was telling them is you can go with nest that's like the big one the problem with nest is it's it's optimized if you live in the property whereas ecobee e co vee that gives you a cool little feature right so what's gonna happen invariably they're going to come up to the thermostat and if it's summer they're gonna drop the thing too about sixty two which is going to cost you a fortune and then of course if it's winter they're going to bring it up to eighty five what what ecobee will do is this you can program it so they can only choose 68 69 70 up to 74 you can block their range so they can be they're trying their best to change it and they can't and that's what you want to do because you need to control these things because it can get way out of hand sometimes and they can make all the difference in the world profitability well you all thanks so much for watching this video Bryce Julian thank you for taking us in here yeah yeah I didn't interview them as much as I probably should have you know probably to hear from them a little bit more but if you have any other questions comments about vacation well investing you put them down below here if you want to learn how you could become an apprentice how you can become like they have done and they've made a whole bunch of money but now they're at a point where not only there's still a very successful creative real estate investors but they're also taking some of those huge chunks of profits and putting those into long-term investments like these are all it's not just this one they've got another one it is purchased as well 20% down 20% down these are big chunks of money and they're gonna have huge cash on cash returns so they can still create an invest but also be bringing in more money if you want to learn how to do that consider my apprentice program or my team I work with our people and in fact Bryce and Julianne helped out a little bit now a little bit of part-time coaching as well and and you can learn exactly what to do and how to do it because well they got started yelling or graduate and graduate school right let's go started yeah and and so it doesn't matter where you're starting from it matters bringing in free and right all right y'all well thanks so much for watching and I'll see you the next video


Yaroslav Muradian · July 23, 2019 at 1:25 pm

Thank you

SW Florida Real Estate · July 23, 2019 at 1:25 pm

Perfect video in time. Got a client looking to buy 2 lots that he can build vacation homes on. 4 deals for me but also i can provide him with some of this great information & tips!

Lonnie 333 · July 23, 2019 at 1:25 pm

Thank you very much for the upload and information. And a big high five to the couple appearing on your channel to help the rest of us starting out. Very much appreciated!

Gee purrs · July 23, 2019 at 1:25 pm

Phil has legs.

Marcus LeeP · July 23, 2019 at 1:25 pm

Looking very nice…

Ollie · July 23, 2019 at 1:25 pm

Hi, Phil. I hope you see this message. Would it be a good idea to build a house (regular family rental) and place a tiny house on the same section to rent out to maximize the income from a single property?

Chris M · July 23, 2019 at 1:25 pm

A little awkward with that couple just silently standing there hahaha but good advice, Phil.

Cody · July 23, 2019 at 1:25 pm

you got 3 dislikes from talking about gender roles lmfao..thats how fucked ppl are nowadays

Moiz Kharodawala · July 23, 2019 at 1:25 pm

Damn Phil
I see you have started uploading frequently nowadays

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