Cashflow Diary™

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Scaling A Short Term Rental Business Q&A Dec 30, 2019

Show notes

🔍 GET THE STR INSIGHTS THAT CREATED 7-FIGURE HOSTS
After managing 400+ units and helping STR hosts in 17 countries achieve $800+ monthly net income per bedroom, I'm sharing my best strategies - free.

Every Monday and Thursday, you'll get:
✓ One actionable STR automation strategy
✓ Data-driven market insights that matter
✓ Implementation frameworks that work
✓ Real case studies from our 20,000+ community

No fluff. No theory. Just proven systems from my living room "office" (fueled by Celsius and Chick-fil-A).

These are the exact insights that help our community achieve:
• 30%+ profit margins
• 80% automated guest communication
• 5+ hours saved weekly

👉 Join 20,000+ successful STR hosts at https://newsletter.cashflowdiary.com/welcome

Now, let's dive into today's episode...

One of the most important things to understand about the short term rental business is that it gets easier with the more units you have. If you’re ready to scale up your business and start acquiring new units, you need to take the steps necessary to set yourself up for success.

Questions and Answers

What do we with units that have carpets in them?

Carpets can be challenging because they are gigantic sponges for bacteria. If your unit does have carpets you need to have a process for keeping it clean in place. Establishing a relationship with a carpet vendor that your cleaning crew can contact to get the work done without getting the approval from you will save you a lot of time.

How many customer service managers do you have and how many hours do they work?

J has a pair of customer service managers working for him that cover a total of 16 hours a day. He chose each of them to hire as managers and he trained them directly through a screen sharing app like Zoom or Loom.

I have some people interested in working with me and my short term rental business but they are wary of marketplaces like Airbnb. Is there anything I can do to help them be more comfortable with them?

You would think these people would be more comfortable with markets like Airbnb and HomeAway than they would with Facebook. If the caller wants to reassure these people, showing them the listing so they understand what details are being revealed is a good option.

Starting with Airbnb as your first platform also gives you the advantage of benefitting from their existing background check process. What the landlord really wants to know is the contact information of the person in the case of an emergency, and that can be solved by simply automating parts of the reservation process.

If you explain to the landlord that you are on the same side of the table and will be making major investments in the unit and don’t want unsavory guests as well, things will go much smoother. In many cases, you have the ability to correct the issue if it does come up than the landlord could with a traditional tenant.

Should I use Guesty if I am bringing on three additional units?

J recommends using Smartbnb and Lodgify instead of Guesty to his students. Everybody who brings on multiple units at the same time gets overwhelmed but it gets easier the more you do it.

It’s also important to understand the difference between using a tool and using it expertly. If you don’t know how to use the tool well, it’s not going to be able to help you scale your business.

We’ve got our first short term rental unit up and running and want to scale. Should we wait until we’re making more profit to scale or push ahead now?

The short term rental business is easier with more units than it is with less. Starting a new unit in a slow season can be very challenging but since the caller has managed to cover the rent of the first unit during one of the slowest periods of the year, they should get started as quickly as possible.

I have an investor that has reached their maximum writeoff capacity, if they invest with me outside of California can he get write off more?

We’re not tax experts and this isn’t tax advice, but there are a number of strategies you can employ to put you in a better tax position. Check out episode 556 of the Cashflow Diary to learn about the Deferred Sales Trust and how it may be a solution to your investor’s problem.

I’m trying to get up and running with Lodgify but I’m having trouble setting up the website, what do I do?

J ran into the same trouble initially. The best solution to getting it done is to just find someone that knows how to do it and asking for their help.

Are you able to do short term rentals in a gated community of is it just a waste of time?

Short term rentals can definitely be done in gated communities, there is just a few extra steps you need to take to make sure everything is communicated properly.

I’m negotiating my first unit and the owner wants me to put the first six months of the lease under my name instead of my LLC, what should I do?

Don’t do the deal that way. Put the entity on the lease and be the personal guarantor. You don’t want to be open to the potential liability and being a personal guarantor will probably satisfy what the owner is really looking for.

If you’re new to short term rentals, when should you fund and grow?

Many of J’s students have been able to access over a million dollars in capital to grow their business and they’ve found that once they get started, it’s fairly easy to pay back their obligations. The thing you have to consider is the opportunity cost of inaction and not taking advantage of the money that is available.

What are the benefits of running Airbnb under a business name?

We don’t do Airbnb, we run a short term rental business. To answer the question, it only takes one time with something defective in your unit to cause you major liability problems. The longer you’re in the business the more likely something like that will come up so you’re going to want to have protection in place. Run your business through an entity of some kind.

Do you need to get financing when you get started or do you wait until your first unit?

One of the best things about the short term rental business is that you don’t need an exorbitant amount of financing to make it work. Once you get one unit, it’s a game of patience until you get your next unit and so on. Self funding is a real thing, and another major advantage of the short term rental business model is that it prepares you for owning real estate long term. You can get financing or not, it’s up to you.

One thing to keep in mind is that the less other people’s money you use, the faster you will put yourself into a strong position in a very short period of time.

One of our rules of thumb is that we have to double market rent to reach our goals. Does this sound right to you?

You’re on the right track but one of the things to keep in mind is to measure on a month to month basis, but not necessarily the 12 month basis. There is seasonality to how travel happens and you’ll start to see the deviations in each month and begin to better prepare for them. That will also help you smooth out the low periods by organizing...

Bookings, Marketing, VA’s, and Landlords in the Short Term Rental Business Q&A Dec 27, 2019

Show notes

No fluff. No theory. Just proven systems from my living room "office" (fueled by Celsius and Chick-fil-A).

These are the exact insights that help our community achieve:
• 30%+ profit margins
• 80% automated guest communication
• 5+ hours saved weekly

👉 Join 20,000+ successful STR hosts at https://newsletter.cashflowdiary.com/welcome

Now, let's dive into today's episode...

Robert Vocolla guest hosts the Q&A show with J today and they’re talking about some very important short term rental business questions. Find out about security processes, managing VA’s, marketing your business, getting out of problematic leases, and more.

Questions and Answers

A question about processes around security technology

Rob uses a simple analog process to make sure his guests don’t run into issues with the security system in his units. He uses sticky labels on each panel that warns the guest not to tamper with it and has a basic template in Smartbnb that gets sent out that lets the guest know how to interact with the security system. This has drastically reduced the number of false alarms.

I’ve got three VA’s covering 18 hours a day, seven days a week and they’re great at following SOPs but not so good at doing customer service work?

Hiring is always a major challenge, if you want to find someone that can handle managerial level tasks it’s going to take a lot of searching. You may have to review, hire, and fire a number of people before you will find that gem of a person that checks off all the boxes. For this particular caller, they have multiple units in multiple cities and that’s adding to the stress of working with his team.

A good rule of thumb is to be prepared to train someone for 30 hours for every hour a task would take you to do. A quick tip for your customer service manager is to look at what time of day your business is getting the most messages because that will inform what hours you should assign your team.

What are the most important marketing KPIs to track?

There is a whole set of metrics around leads, around customer conversion, and average order and frequency. All of them should be measured and tracked and each one can have a compounding impact on the growth potential of your business.

Another thing to keep in mind is that a lot of your marketing on Airbnb is about working with the algorithm correctly. Make sure you have the right pictures with good descriptions because your search position in the rankings will determine your success on that platform.

Tools like Smartbnb are crucial to understanding the most important metrics in your business. The only way to have metrics to look at and measure is to gather data.

What is the difference between Basic and Pro in Lodgify and Smartbnb?

The biggest difference between the two is one uses and API to communicate with other apps and the other uses the older iCal method. Since the caller is using Smartbnb, they should just stick with basic because they already have a built in sync feature that makes Pro unnecessary.

What are you guys doing to get more bookings from booking.com?

Getting guests on booking.com is similar to the other channels even if it feels like it’s more work. One of the secrets is to have every single field filled out for your listing and setting your prices correctly with Lodgify. Keep in mind that guests from booking.com may be more seasonal as well.

Mirror the same types of policies on booking.com that you have on other channels to keep everything consistently.

How do you guys do your messaging for booking.com?

No one is currently satisfied with the messaging situation of booking.com. It’s a very manual process but J is actively looking to create a better system.

A question about a six month reservation opportunity

The caller feels like the guest may be trying to pull something over on him. Since that’s the case the question is around the tactical implementation of the reservation. The caller needs to be able to collect in cash and upfront 60 days worth of reservation while also implementing a 30 minimum notification in anything changes.

Give the guests multiple plans and ways to pay. Under no circumstances should the caller accept less than their target profit numbers for that unit.

Are there any resources I can use to explain the short term rental business to financial institutions?

The risk of real estate and the risk of hospitality are different but all the literature and strategies that J uses are meant for landlords, not financial institutions. The majority of lending institutions are still putting together the underwriting model for the short term rental business and they’re not quite ready yet.

You can find some resources that will help you tell the story of your business to prospective partners within the Mastermind product.

I have a potential situation where I may have to get out of a lease. How do I get out?

If you want to get out of your lease, and keep in mind this is not legal advice, you need to be able to document the incidents that come up. One of the promises that the landlord makes with you is called Quiet Enjoyment of the unit, and if they are failing to follow up on that promise you may have something to work with.

Talk to a landlord attorney to learn what you need to prove that the landlord has broken the contract that will let you out of the lease.

In this case, the landlord has a problem and it shouldn’t be the caller’s problem. Whichever path the caller takes, he needs to document everything.

How much do we pay for a manager? What basic rules does a manager follow? What calendar platforms does Lodgify sync with?

Check out module 4 and 5 of the Mastermind product.

What would be the best way to approach an owner about Airbnb?

Rule #1 to keep in mind is that this is not an Airbnb business, this is a short term rental hospitality business. Airbnb is just one channel where you get your customers. If you use the terminology “Airbnb business” you won’t even get your foot in the door with most landlords. Go to cashflowdiary.com/star to learn how to present the business to property owners and to get a deeper understanding of the methodology of the business.

Setting up the business the right way at the front end is what will allow you to scale.

Hawaii is a 30 day market and I’ve got a 25 day vacancy in between reservations. What can I do about it?

What can you sell either the previous guest or future guest to cover the revenue you would need for that vacancy period? Being creative is what is going to bridge that gap and once you create these offers you can use them for any number of guests in the future as well.

Links:

cashflowdiarypodcast.com

Business Owners Don’t Need to Fear The Next Recession Dec 23, 2019

Show notes

No fluff. No theory. Just proven systems from my living room "office" (fueled by Celsius and Chick-fil-A).

These are the exact insights that help our community achieve:
• 30%+ profit margins
• 80% automated guest communication
• 5+ hours saved weekly

👉 Join 20,000+ successful STR hosts at https://newsletter.cashflowdiary.com/welcome

Now, let's dive into today's episode...

Jonathan Slain is the Founder and CEO of Recession.com, an author, a highly respected keynote speaker, and an expert on recessions & why business owners don’t need to fear them.

Jonathan spent the last Great Recession huddled in the fetal position on the floor of his office. He borrowed $250,000 from his mother-in-law to survive. Jonathan paid his mother-in-law back and is now a highly sought-after consultant (and, yes, he’s still married!).

Jonathan understands not only how to prepare your business for the next major recession but also how to turn it into a profitable opportunity.

Podcast Highlights

Who is Jonathan Slain?

Much of Jonathan’s life has been spent in the metaphorical Batcave, doing the research and preparing for whatever it was that he was working towards. Deep preparation has been the common thread in Jonathan’s life all the way back from high school. Studying people who were successful during major recessions is what drew his attention and his experience during the recent Great Recession is what put him on his current path.

Jonathan is also a recovering investment banker, studying different companies and economic indicators for 100 hours a week over the course of two years. He learned that as entrepreneurs, we all always have a recession coming, even if it’s not an economic recession. There are a number of personal events that could put your business into a recession and Jonathan’s focus is on being prepared for the next one, whatever shape it happens to take.

How does one plan for things we can’t control?

One major change recently in California has been the recent regulations around single use plastic. These regulations are going to have major impacts on many different kinds of businesses. In these situations, there will always be a few entrepreneurs who see the signs and put themselves in a position to take advantage of the coming changes.

There have been 11 recessions since World War 2 and they last an average of 11 months. When they do come around, they create a massive amount of disruption in the market that also comes with a number of opportunities. Every business can do things to prepare and position themselves for the major recessions.

The Next Recession

We should be looking forward to the next recession, it will happen eventually so you should be prepared. All it really takes is a little forethought and some work upfront that will allow you to pounce when the recession hits, instead of spending the first few weeks or months of the recession trying to catch up.

Every major recession shares some common elements that you can look at historically and predict what may happen in the future. Marketing dollars go extra far during a recession, can you put some money aside now that will allow you to take advantage of this? What if you had a war chest available to buy distressed businesses and assets?

The #1 thing to do to prepare right now

The first step is to assess where you are in your recession readiness. You can go to recession.com and take the free survey to get your recession readiness score. It will also let you know which areas you need to start improving.

The second step is to tune up your personal and business finances. How much debt are you carrying right now? Do you have a line of credit available to you so you can take advantage of opportunities that come up? Can you eliminate your personal guarantees on any loans you have right now?

If you’re going to be prepared for a recession, you need to start doing it now because these options don’t exist once the recession is all over the news and the economy starts to tip.

What are some mistakes you’ve made?

For Jonathan, his biggest mistake during the last recession was not being diversified at all. What would happen to short term rental owners if there was a major scandal with Airbnb? What is a hedge that you can build into your portfolio now that has an inverse relationship with a recession so that when part of it goes down, other assets go up.

You need to have an emergency break so you know when to stop borrowing. Set your limits before the crisis so not all your decisions will be emotionally based.

Check your vendors and start building up additional channels for customer acquisition. Don’t just rely on Airbnb. Short term rentals are not likely to go away in a recession but you do need to add a little insurance to your business by removing a single point of failure.

Is there something that smaller companies are more vulnerable to?

The number one vulnerability for small businesses and entrepreneurs is the balance sheet. How many months of operating expenses do you have available in the event that business dries up and you need to survive? Plan for the event that your monthly revenue starts to decline and think of expenses that you can cut at certain thresholds. Have those difficult conversations now before they become absolutely necessary.

Another tip is to think of the niches that bigger businesses can’t take advantage of. What things will people still spend their money on during a recession that you can look to and benefit from?

Reference: Rock The Recession, Jonathan Slain

Jonathan’s Takeaway

The first thing and the most technical starting points you can begin with is bench marking. Take the assessment and find out where you are right now and what you can do to get prepared today.

Links:

recession.com

Thank you for listening! If you enjoyed this podcast, please subscribe to the show on iTunes and Stitcher Radio!

🏠 Want to Join the Elite 10% of Short-Term Rental Hosts?

Dear Future Top Performer,

Are you tired of working harder instead of smarter in your STR business? Here's a wake-up call: The most successful hosts aren't grinding 24/7 – they're leveraging a proven formula that transforms average properties into profit powerhouses.

Let me share something game-changing with you...

There's a simple yet powerful equation that's revolutionizing the STR industry:
L × C × F × M = GP

This isn't just another fancy acronym – it's the exact blueprint top performers use to:
• Generate consistent leads without burning out
• Convert browsers into eager bookers
• Maximize guest frequency (hello, repeat customers!)
• Amplify their margins while others race to the bottom

Right now, ...

Dealing With Bad Reviews Before The Holidays Q&A Dec 19, 2019

Show notes

No fluff. No theory. Just proven systems from my living room "office" (fueled by Celsius and Chick-fil-A).

These are the exact insights that help our community achieve:
• 30%+ profit margins
• 80% automated guest communication
• 5+ hours saved weekly

👉 Join 20,000+ successful STR hosts at https://newsletter.cashflowdiary.com/welcome

Now, let's dive into today's episode...

This is a review based business, and that means you will probably get some bad reviews at some point. The question is what do you do about them? More than bad reviews, we’re talking about preparing for the holidays, click bait photos, and more.

Questions and Answers

For the inventory checklist, how detailed do you get?

You can be as detailed as counting the silverware, the question is “at what point will you file a claim?” It probably doesn’t make sense due to the manpower and hours it would take to follow up on that. A better way to think about it is “is there enough silverware in the unit?” The benchmark for detail should be somewhere around where you would file a claim for.

Preparing for the upcoming holidays

Now is the time to get ready for the holidays. Change the batteries for any automatic door locks, replace the pilot lights for any gas furnaces, get blankets into the units where the climate gets chilly. Have a chat with your crew now to find out if they are going to be working during the holiday.

We had a guest break the do not obstruct the camera rule. How long should we wait to leave a bad review without the guest retaliating? How is the guest punished for not paying the fee?

Many of the platforms have a content policy and if the guest leaves a review that violates the policy it will be hidden. The review is basically the guest’s experience with your service so that means it can be very subjective. When leaving a review, neither party will be able to see the review until both have posted it. Ideally you should wait until the last minute of the fourteen day period to avoid a retaliatory bad review. If the guest has already left the review, then you have to rely on the content policy to help you out.

In terms of fees and guests not being willing to pay, just state the facts of what happened. Remove the emotion and Airbnb may be able to take care of the fee for you.

I have a new short term rental unit, how long should I need to wait to get my first booking?

The first issue with the caller’s unit is that since they are targeting business travelers their unit may be too large. Two bedroom units that are pet friendly don’t usually have vacancy issues. They tend to be perfect for small families going through an insurance claim so linking up with a local insurance company may be a good move. For J, if he’s going to be working with a two bedroom unit, he’s going to gear it towards a market that he knows works well with that much room. Take a look at the events that are happening locally and focus on the kind of customer you want to serve. Another thing to note is that the winter season is slow for the area where this caller is from.

There is a stream of revenue that’s right in front of you, you just need to get clear on who they are and get in front of them. What are they searching for and how can you appeal to them?

Being insurance friendly

Note in your titles for your listings that you are insurance friendly. This has made a big difference in the occupancy rates of J’s units.

Regarding an arbitrage unit, are you protected by your lease if there is a change in ownership?

If you’ve done your lease correctly, they can’t end your lease early as long as you pay your rent and follow the terms. That doesn’t guarantee that they will renew but they can’t terminate it.

What size of unit should I target to get past the ordinances in place and actually reach the owners?

Part of the reason we focus on short term rentals is because we ultimately want to own real estate in the long term. Phase 1 is getting one unit, phase 2 is picking up a few more units, and phase 3 is being able to pick up units at your leisure. Start with the size of buildings that you intend to own and the numbers make sense.

Don’t go larger than owner direct, you should be able to get the owner on the phone when you need to in the event of a problem.

What’s in it for a real estate agent to help me?

The short answer is commission. In general, real estate agents will be able to assist you, even if they don’t have all the knowledge of the short term rental model. In many ways, you will have to train them in what you need.

How do you feel about click bait photos?

This is a horrible idea. When it comes to photos, you are competing for the click and people will not click on click bait style photos. Professional photos are far superior for communicating your brand and business than pictures of Eminem.

Do you secure your wifi router?

On most routers, there is a way to access the control panel of the router that connects all your various locks and devices. The way J protects this is by taking a photo of the physical information on the back of the router, than blacking it out with a marker and electrical tape to prevent a guest from accessing the info.

Is there anything operationally different for the insurance guest?

No matter who contacts you first, the person will always have to go back to the insurance company. Because of this the insurance guest takes longer to close and there are more questions involved. Also note that insurance guests tend to use a lot of data so keep your internet plan in mind.

Insurance guests don’t care about recommendations for restaurants and have a number of different concerns that you need to communicate that don’t apply to regular guests.

How will bad reviews influence a new listing? Should I start a new account?

The simple answer is to start a new account. The only factor the caller may want to preserve is the age of the account, but that is more than made up for by the benefits of having a fresh account. By having additional units you would also generate a number of reviews that will minimize the impact of bad reviews if you go the route of not creating a new account.

Sometimes things go wrong and a listing will just need a fresh start.

If you have multiple listings, what website or platform do you recommend using?

The platforms you use should be relative to the types of customers you are trying to attract. Most people should start on Airbnb because of the built in training wheels that help you get started. As you get more experience, it’s easy to graduate to other platforms.

I’m operating in a market with a lot of amateurs, have you ever come across this?

Every market has a significant number of amateurs because the barrier to entry is so...

Learning Is The Only Skill That Matters Dec 16, 2019

Show notes

No fluff. No theory. Just proven systems from my living room "office" (fueled by Celsius and Chick-fil-A).

These are the exact insights that help our community achieve:
• 30%+ profit margins
• 80% automated guest communication
• 5+ hours saved weekly

👉 Join 20,000+ successful STR hosts at https://newsletter.cashflowdiary.com/welcome

Now, let's dive into today's episode...

Jonathan Levi is an experienced entrepreneur, angel investor, and lifehacker from Silicon Valley. Jonathan is known for speed learning his way to all achievements in life: from entrepreneurship to podcasting and even dating. Since 2014, Jonathan has been one of the top-performing instructors on Udemy, with his course Become a SuperLearner® (now retired) earning him over 60,000 students.

He has since snowballed this success into the launch of his own brand and platform, SuperHuman Academy, which produces such products as the award-winning SuperHuman Academy Podcast (3 million+ downloads) and numerous online courses. He is based in Tel Aviv, Israel, preparing to release his 3rd book “The Only Skill That Matters”

Podcast Highlights

Who is Jonathan Levi?

Jonathan grew up in Silicon Valley and was always meant to be an entrepreneur. In many ways he struggled in school because he couldn’t learn the same way that everyone else seemed to do. Deep down, Jonathan is a maker and a creator that is focused on solving problems and learning new things all the time.

Jonathan was always a bright kid but he had problems in the classroom environment. The only way he made it through high school and got through the curriculum was by being medicated. When he got into business school, he knew that medication wasn’t going to cut it. He needed to figure out another way to learn that made sense for him. It was around that time that he found someone who had developed a methodology for speed reading and accelerated learning that completely changed Jonathan’s life and gave him his first real world super power.

After meeting multiple real world super humans, Jonathan learned that anyone can do these incredible things simply by learning the techniques and practicing.

Jonathan is a big believer in the law of attraction, but he’ll be the first to tell you that it only works if you implement the law of action first. There are very few things in life that can’t be accomplished if you put in the work to learn the ropes. Whatever challenge you are facing in life, the difference between excitement and anxiety is knowledge.

For Jonathan, it was a series of individual moments that culminated in his super power. He didn’t plan for online courses to be his business, it just sort of happened after moving to Israel and exploring entrepreneurial opportunities. After discovering a course on coding and seeing how successful it was, Jonathan dug into what it took to create a course and put out his first one on Udemy. Slowly but surely, it developed into a full time business.

Learning Is The Only Skill That Matters

Learning is the ultimate meta skill and the only skill that matters. There are proven techniques to improve your ability to learn. There is no genetic advantage that the world’s best learners have over everyone else. Studies have shown that with six weeks of training anyone can rewire their brain to resemble the brain of a memory champion. There are people well into old age who are learning new skills just as efficiently as their younger counterparts.

You don’t have a lousy memory, you just don’t know how to use it right yet.

Our current education system hasn’t been modified for a long time. It hasn’t taken in the new ways of learning that we’ve discovered in recent years. It’s actually theorized that the ancient Greeks used similar techniques of visualization that advanced meta learners use today, but the techniques were suppressed by the early Church.

Learning vs Memorization

There is a difference between memorization and learning but we can’t learn anything without committing it to memory. You need to be able to apply your knowledge in order to make use of it, but that’s not possible without memorization first.

Reference: The Only Skill That Matters, Jonathan Levi

Jonathan’s Takeaway

Make it simple, if you experience a quick win you will likely want to experience more. In the next 24 hours you are probably going to encounter five to ten new people. Introduce yourself and memorize their name by creating a unique visualization for each one. Before you go to bed, set yourself a reminder to review how many people you remember. If that intrigues you, you are ready to experience something that is exponentially more powerful.

Links:

https://superhumanacademy.com/

https://superhumanacademy.com/book

Thank you for listening! If you enjoyed this podcast, please subscribe to the show on iTunes and Stitcher Radio!

🏠 Want to Join the Elite 10% of Short-Term Rental Hosts?

Dear Future Top Performer,

Let me share something game-changing with you...

There's a simple yet powerful equation that's revolutionizing the STR industry:
L × C × F × M = GP

Right now, you're probably leaving thousands on the table. The truth? 80% of your potential profits are locked behind just 20% of the right actions.

Ready to stop bleeding money and start leading the pack?

Join our newsletter today and get weekly insights that will help you:
✓ Master the Growth Formula
✓ Optimize your listing for maximum visibility
✓ Create an irresistible guest experience
✓ Scale your business the smart way

Don't let another day pass watching others succeed while you're stuck in the grind.

👉 Click here to join the newsletter and start your journey to the top 10%!

The Listing Reviews Q&A Dec 09, 2019

Show notes

No fluff. No theory. Just proven systems from my living room "office" (fueled by Celsius and Chick-fil-A).

These are the exact insights that help our community achieve:
• 30%+ profit margins
• 80% automated guest communication
• 5+ hours saved weekly

👉 Join 20,000+ successful STR hosts at https://newsletter.cashflowdiary.com/welcome

Now, let's dive into today's episode...

Sometimes your technology breaks on you! Even so, we’ve got a number of listener questions tackled today including a couple brutally honest (but helpful) short term rental listing reviews. We always come from a position of honesty in hopes that you will make more money, so we’re not going to tell you comforting lies just to make you feel better. Listen in to learn why the bad photos can sink your listing and what you can do about it.

Questions and Answers

A question about a 37 day booking and the importance of reviews

One of the things to know about the short term rental business is that it is definitely a review based business. Experience in this business is generated specifically by scaling up and doing the work more often. For this caller, they shouldn’t pass on the 37 day booking unless it is going to hurt their business long term.

A long term booking will always make that unit’s performance suffer when compared to other more short term reservations. But if it allows them to add another unit financially, it may be a good move because it will allow the caller to achieve Super Host status by the end of the quarter.

It can also be important to run an AirDNA report on your zip code to understand the trend for your area. That will allow you to understand whether your prices are on point or if you’re leaving money on the table.

How do I get an affiliated link from Uber and Lyft?

Inside the app, you can find your share code which is the code you can use for your bookings and guests. Working with restaurants by sending them business instead of getting paid for the referral may actually be superior to an affiliate relationship. Having them on your side in political or municipal issues will probably be more important than having an additional revenue source.

J reviews a caller’s first post on Airbnb

When creating a short term rental listing, lead with photos with the inside of the unit instead of the amenities. Photos of the exterior can also lead to security issues if it’s possible to identify the address of the unit.

The caller’s photos should probably be reshot due to the handheld nature of them as well as the general poor quality. They suffer from lighting and focus challenges and the caller’s bookings will probably be lower than what they could have achieved. Another good tip is to stay away from vertical photos at all times.

The caller has definitely put in some work on the short term rental listing, but seems to have skimped on a few crucial elements like the photos and design. In order to tell the right story with your photos, you have to make the investment and do them right.

The ideal reaction to your short term rental listing should be the reader feeling like they must stay at your unit.

I’ve got a meeting with the zoning department, do you have any pointers for me?

Since the caller only has three minutes to talk, he should be using his time to instill doubt in his listeners because right now they are certain that the caller is the bad sort of short term rental owner. He should show them that he’s a professional and has systems in place to deal with all the common issues that people complain about with other less professional short term rental owners.

Another review of a caller’s first short term rental listing

The caller already has some hesitation about the photos for her listing. The reason the photos look off to the caller is that their photographer used HDR, which is something that you should always avoid. HDR can cause many different types of issues with the lighting and focus of the photo.

Nearly all the photos on the listing have to be scrapped. Preferably, the next photographer avoids HDR, uses a 15mm lens, and uses natural light instead of attempting to color correct after the fact.

How much can I depart from the blueprint you’ve laid out if it makes sense for who we want to serve?

If you’re thinking about who you want to serve and making choices based on that, you aren’t deviating from the blueprint at all. If the caller wants to serve business travelers from Mexico and knows what they need and want from a short term rental listing, then they should go for it.

One thing to keep in mind is that business travelers probably don’t need much square footage and if the caller goes with a larger unit they may run into underutilization. The bulk of business travel is done with smaller units.

Any thoughts on Properly to manage cleaners?

Properly is a great tool to manage cleaners, but the question is can the staff doing the clean effectively use the tool. If they can, then definitely take advantage of it.

Do you refresh Wheelhouse manually?

J lets the software refresh all its own and it handles everything just fine. He does check it a couple of times a week just to make sure it’s doing what it’s supposed to be doing but that’s it.

Links:

cashflowdiarypodcast.com

cashflowdiary.com/star

Thank you for listening! If you enjoyed this podcast, please subscribe to the show on iTunes and Stitcher Radio!

🏠 Want to Join the Elite 10% of Short-Term Rental Hosts?

Dear Future Top Performer,

Let me share something game-changing with you...

There's a simple yet powerful equation that's revolutionizing the STR industry:
L × C × F × M = GP

Right now, you're probably leaving thousands on the table. The truth? 80% of your potential profits are locked behind just 20% of the right actions.

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Finding Good Deals in the Short Term Rental Business Q&A Dec 05, 2019

Show notes

No fluff. No theory. Just proven systems from my living room "office" (fueled by Celsius and Chick-fil-A).

These are the exact insights that help our community achieve:
• 30%+ profit margins
• 80% automated guest communication
• 5+ hours saved weekly

👉 Join 20,000+ successful STR hosts at https://newsletter.cashflowdiary.com/welcome

Now, let's dive into today's episode...

There is no definitive good deal in the short term rental business. If you want to know if your deal is good or not, you need to know one simple thing first. It’s something that’s going to drive your reviews and the growth of your business, and that’s meeting your customer’s expectations. Figure out who you want to serve first and that will make the answers to your questions much clearer.

Questions and Answers

Are you still hunting for apartment deals?

J still loves apartments, he’s just changed who he puts in them. With apartments, net operating income is the name of the game and most importantly, if you can manage that properly the value goes up as well. J is not getting out of the apartment game anytime in the near future.

Do you think it’s a good idea to incentivize guests to do a load of laundry before they end their stay?

Quality control becomes an issue here. How do you know the laundry was cleaned correctly? There are other ways to lower your cleaning costs if that’s the goal. J tends to shy away from asking his guests to do anything, some guests will actually become offended by getting the request to do additional work. For this particular caller, the issue may lie in the cleaner that he’s using and their method of billing for work. Ideally, with a linen service, you should only be paying for your laundry that has been weighed while dry.

When it comes to a guest checking out, if you have a checklist for them to complete, be upfront with the reasoning for the tasks so they don’t have to wonder why they are putting in some extra work.

What’s the best way to avoid bed bugs before they appear?

Bed bugs tend to come in with a guest, they don’t typically just appear. A good tip is using a metal luggage rack to reduce the incidence of a guest putting their luggage on the bed directly. Protecting the mattress with a casement is also a good precaution.

Bed bugs are typically pretty rare, but there are still steps you should take to minimize your risk. Insurance is one example of a way to cut the cost, the trick is making sure the coverage is actually what you need. It’s not uncommon for a bed bug infestation to cost you thousands of dollars to remediate. Be sure that your insurance actually covers bed bugs specifically. You don’t want to get into a situation where you save some money on your premiums but aren’t actually covered from the risk you’re trying to mitigate.

How do we get around the key fob issue?

We tend to leave the key fob inside the unit and the trick is getting the guest to the unit for the first time. Module 3 of the Mastermind product covers this in more depth. Go to cashflowdiary.com/star to learn more.

Pricing in the Short Term Rental Business

As you enter into your slower season, pricing becomes even more important. If you aren’t doing dynamically adjusted pricing, you’re either leaving money on the table or having a lower occupancy than you should.

I have an opportunity to buy an eight unit apartment building and I want to use them for short term rentals, do you think this is a good deal?

There is no definitive good deal. What’s a good deal for J will probably not be a good deal for you. However, there is a customer that your business is best suited to serve. There are other factors that determine if the deal is right for you and it all stems from who your customer is. You won’t know it’s a good deal until you know who your customer is.

What’s most important, what’s going to drive your reviews and the growth of your business, is meeting your customer’s expectations, and you get to choose who you want to serve.

What markets do you search for apartment deals in?

Deals tend to come our way right now, so J isn’t on the search for apartments deals at the moment. If we were looking, some markets might include Long Beach, Phillidelpia, and parts of North Carolina would be on the list.

What are some ways that you can find owners that are willing to do subleasing for Airbnb?

There are a couple of things to understand. You are not subletting and you don’t have an Airbnb business, you have a short term rental business. If you start off thinking you have an Airbnb business, that will limit your capacity. That being said, finding landlords is fairly easy. Look for “For Rent” signs and call them. To get a better idea of what to say and how the system works, check out the free presentation at cashflowdiary.com/star.

Owner controlled buildings are a great way to build your experience while also building your business.

I have three units and people want to rent them long term, how can I prevent that?

It’s not uncommon for a smaller square foot location to outperform a larger square footage space in certain markets. Since the clients that the caller is asking about are typically business people, there shouldn’t be a big issue with letting them rent long term. Whether the guest wants to stay one day or hundreds of days, it doesn’t mean you have to discount the price.

Offering an incentive like a free TV when a guest books long term is another good way to get the guest to work very hard to get their HR department to cover their stay.

I have a guest that has a service dog that they didn’t tell me about and I’m trying to evict them, what should I do?

This caller is creating a difficult problem for themselves by trying to evict the guest. If it’s an actual service animal, they may just want to leave it alone. If the animal ends up damaging the unit, they can deal with it then.

Since the guest has a service animal and the caller has caught them, they can now go to them and communicate that there are other rules that need to be followed. If they are going to call the animal a service animal and not follow service animals rule, then he may have something to work with.

What are ways to market your short term rental business, and how do you become a student?

You become a student by starting with the presentation at cashflowdiary.com/star. There are two products available. The Blueprint is meant for students to learn how to get their first unit, the Mastermind product is for those students who are ready to scale their business.

In terms of marketing, the most important thing is to first understand who you are serving. Once you know that, you will know where and who to market to. Don’t even consider marketing until you ...

Is It Too Late To Start The “Airbnb Process”? Q&A Dec 03, 2019

Show notes

No fluff. No theory. Just proven systems from my living room "office" (fueled by Celsius and Chick-fil-A).

These are the exact insights that help our community achieve:
• 30%+ profit margins
• 80% automated guest communication
• 5+ hours saved weekly

👉 Join 20,000+ successful STR hosts at https://newsletter.cashflowdiary.com/welcome

Now, let's dive into today's episode...

If you’re thinking about starting the “Airbnb process” and aren’t sure if you’ve missed the boat, listen up. Real estate is changing but it’s not too late. Airbnb is just one of many marketplaces that we use. Short term rentals are here to stay and if you want to learn how to build your real estate portfolio, now is a great time to start putting the systems in place.

Questions and Answers

I’ve been able to get the landlord to agree to the short term rental business model in general but I’m not sure I can make a profit, what should I do?

Step one always comes down to understanding who it is you want to serve. When you focus on who you want to serve, one of the criteria you’re looking at is their income. That will help you understand what area of town to be in and how much they will pay for certain experiences. All your streams of income will be based on how much income your ideal guest makes.

Once you know all your potential areas of revenue, you will be able to subtract out all those things and complete the picture of profitability.

It can be difficult to use aggregated data to determine what your prices should be. The spread is so wide that it’s not very useful for identifying a specific case like your listing. Once you complete the exercise of figuring out who you’re serving, it becomes much easier. Keep in mind that your revenue is much more than just your room rate.

How do I automate my messaging system?

Lodgify has a rudimentary system for messaging. What we do to shortcut that is provide our guests with a link to an electronic house guide where all the relevant data is included. Everything except the dynamically generated door code because we still want to be able to maintain control of the access to the unit.

A question about a listing review

The caller’s photographer did a good job on the photos for the listing. Since the caller has followed the system closely most of the details are on point. One area that could be improved on is the copy detailing the neighborhood. Your listing is your first line of customer service, if you answer the question before the person asks you have one less question to answer later on. This can really help save time once you have a number of different units.

Which program should I consider to learn how to manage resort properties?

In terms of execution, resort units are very different from residential. In some ways resort units are easier because the kinds of customers you are serving are more obvious. For this particular caller and his thirteen units, the Mastermind Product is his best choice. Go to cashflowdiary.com/star to learn more.

When it comes to negotiating with the owner of the property, the structure the caller is using is the same one that we use. If the owner wants a cut of the business, they have to be able to contribute more than just the space. Otherwise, renting the property from them is the right way to go.

How do you dynamically generate a door code?

It depends on the platform you’re using. Sometimes the software you’re using can integrate directly via an API to create the door code, other times a personal assistant can do it.

What’s the difference between leasing an apartment under an LLC or my own name?

The difference between the two is in who is doing the business. What it comes down to is if something goes wrong, who does the landlord have a claim against? You or your LLC? If you’re trying to accumulate assets, it’s generally best to use an entity to shield those assets.

Is it too late to start the Airbnb process?

We are not in the Airbnb business, we are in the short term rental business. Airbnb and the rest are marketplaces. It’s not too late but you also have to understand that real estate is changing. Many of the established players in the industry have begun to mimic Airbnb because of these changes.

Even how we transact real estate is changing due to the technology involved. It’s only becoming more liquid as technology makes the process of transacting faster and easier than ever. Just because you didn’t recognize the change before it started doesn’t mean it’s too late. If anything, now is the perfect time.

How are you doing Homeaway pricing?

Right now, Homeaway pricing is being done updated twice a day based on comparable pricing on a set of properties within the software.

Did the automated messaging templates come out yet?

Not yet, but existing Mastermind students will have access to the templates very soon.

A note on the upcoming holidays

Now is the time to earn some additional revenue and create really great experiences for people. Make sure your security measures are working and everything is up to date. What could happen is not something you want to have happen. Get everything lined up including your pricing, inventory, and team now so you can take advantage of this time of year.

Are there effective ways to approach companies directly about bookings?

There are a number of ways to go about this. The front door method is to look up Concur customers in your area. They are already potential customers for your business. If you’re using the system we suggest, you can also create a promotion that incentivises your guest to refer you to the person that arranged their travel. If they are corporate travelers, they know exactly who you need to talk to and that’s a great way to get your foot in the door.

Links:

cashflowdiarypodcast.com

cashflowdiary.com/star

Thank you for listening! If you enjoyed this podcast, please subscribe to the show on iTunes and Stitcher Radio!

🏠 Want to Join the Elite 10% of Short-Term Rental Hosts?

Dear Future Top Performer,

Let me share something game-changing with you...

There's a simple yet powerful equation that's revolutionizing the STR industry:
L × C × F × M = GP

This isn't just another fancy acronym – it's the exact blueprint top performers use t...

Shawn Harper’s Winning Edge Nov 25, 2019

Show notes

No fluff. No theory. Just proven systems from my living room "office" (fueled by Celsius and Chick-fil-A).

These are the exact insights that help our community achieve:
• 30%+ profit margins
• 80% automated guest communication
• 5+ hours saved weekly

👉 Join 20,000+ successful STR hosts at https://newsletter.cashflowdiary.com/welcome

Now, let's dive into today's episode...

Shawn Harper is a former American football offensive tackle in the National Football League. Harper was drafted by the Los Angeles Rams in 1992. He also played for the Houston Oilers, the Indianapolis Colts, and three years in NFL Europe with the Amsterdam Admirals and Frankfurt Galaxy. Shawn Harper appeared on the hit MTV show Made. He has helped transform thousands of corporate environments, built leadership, trained teams and impacted youth development in schools, and churches with high energy keynote speeches that activate winners.

Shawn Harper is the bestselling author of The Winning Edge: 8 Principles That Will Bring Out the Winner in You! and founder/CEO of American Services and Protection, which has provided Ohio small and medium-sized businesses, corporations, municipalities, non profits, government agencies, colleges, and universities and organizations with a wide range of security solutions that focus on providing highly-trained professionals, tailored to the specifics of each job.

Podcast Highlights

Who is Shawn Harper?

For Shawn, it’s very hard to define who he was looking back from today’s perspective. We tend to gloss over the story in the process of becoming who we are. Shawn was plagued with setbacks and adversities in his youth, he was actually voted most likely to fail in school.

Adversity can make you or break you. Shawn’s school days were tough and early on he believed himself to be the loser that everyone else thought he was. It wasn’t until he changed his mindset from victim to victor that everything changed.

Never allow people to create your world because they will always create it too small. When Shawn made the decision to focus on his dream of playing in the NFL instead of listening to what other people thought he was capable of, nothing was the same. Once you change your focus, you change your life.

What was the transition like from playing football to the world of business?

In the case of the NFL, there is an established system in place for growth and development. For many people, when they leave that team and system to go do something else on their own the result is usually failure. Even superheroes have friends and support to help them achieve their goals. When athletes leave the game, they must build a team and find mentors to help them in the new arena. That was the secret to Shawn’s later success.

It took years for Shawn to come to that realization. All success in life comes from people having a team around them.

Playing To Win

We are created to win. Your perspective is everything in this regard. We are attracted to winning and nearly everything we do is geared towards winning. In third or fourth grade we are introduced to a different concept called success. Success teaches you production, but winning teaches you re-production. Successful business people are productive, but winners scale their business.

A lot of people get dismayed, depressed, and angry because they know they are successful but deep inside they know they are not winning. Winning has been hijacked by success.

The secret is to start moving, get out there and start connecting with people in whatever domain your win happens to be in. If your win is mentoring small business owners, start connecting with small business owners!

The way you motivate or encourage one person, is not how you will motivate or encourage another. You have to find your team’s pain points and motivations and learn how to speak to them as a leader, because everything comes down to people.

Is where you are today something you could have envisioned?

Shawn had no idea he would be where he is today. There is a major difference between your image and your identity, but if you’re not careful you will buy into other people’s perception of your image instead of who you really are. Most of Shawn’s life he was caught up in everyone else’s image of himself. It wasn’t until he started building skill sets to define his identity that things changed.

If you can walk in and apply your concept of winning a little bit every day, then your perspective on who you are and what you manifest changes. All actions stem from thoughts, and all thoughts from belief systems. Your belief system is nestled in your self concept and you always manifest your self concept. Don’t let missed opportunities define you, stay focused on your goals.

Getting Past Failures

One of the greatest advantages athletes have is more than just experiencing failure on a common basis. It’s the team around them that keeps pushing them on and encouraging them. When we’re alone, we’re much more likely to hang up the cleats when we fail, but a team can provide the motivation we need to push through. Even leaders need encouragement from their team.

To have that person in your life that believes in you is vital, because without them life will chew you up and spit you up.

Reference: The Winning Edge: 8 Principles That Will Bring Out the Winner in You!, Shawn Harper

Shawn’s Takeaway

Three words haunt Shawn: Wish’a, Could’a, Should’a. You can not live life comfortably, because if you’re not careful your comfort zone will become your casket. You will get knocked down but failure is your friend. Learn from the failure and get back on the bike. The average millionaire has filed for bankruptcy three times, don’t give up.

Links:

How To Win Friends And Influence People

Shawnharper.org

Thank you for listening! If you enjoyed this podcast, please subscribe to the show on iTunes and Stitcher Radio!

🏠 Want to Join the Elite 10% of Short-Term Rental Hosts?

Dear Future Top Performer,

Let me share something game-changing with you...

There's a simple yet powerful equation that's revolutionizing the STR industry:
L × C × F × M = GP

Introducing The Instant Book Special Q&A Nov 21, 2019

Show notes

No fluff. No theory. Just proven systems from my living room "office" (fueled by Celsius and Chick-fil-A).

These are the exact insights that help our community achieve:
• 30%+ profit margins
• 80% automated guest communication
• 5+ hours saved weekly

👉 Join 20,000+ successful STR hosts at https://newsletter.cashflowdiary.com/welcome

Now, let's dive into today's episode...

Get unstuck and get one step closer to making short term rental real estate a real thing for you. Get answers to your questions so that you can keep moving forward towards your financial and business goals.

Questions and Answers

We are entering into the slower winter season, what additional things can we give to our guests so they book with us over others?

The first time experiencing a slow season can be a challenge. The caller has been leveraging his membership with his local BNI group which is a great place to start. Another potential avenue is to connect with the travel agent in the group and ask them about working together. It’s possible to start generating instant book specials that allows you to acquire a guest at your advertised rate while also creating a referral for the travel agent.

How would you pitch to a BNI group?

It takes a while to get any sort of response from a BNI group because their reputations on the line. As you build your relationships in that group you want to focus on creating a power team, where each individual has different strengths.

Think about your centers of influence, like doctor’s offices that are members of the BNI group and start building those relationships.

How do you deal with a secured building?

There is a module is the Mastermind Course that members of Cashflow Diary can access that helps with this issue. The key question to ask is “if I order food, how does the food delivery guy get to the front door?”. Whatever the process is, that’s how your guest will access the unit.

How can we have properties in a state that we are not even in?

To have a property all you need is a lease, so it doesn’t matter where you are located. If you run the system properly, it only takes around an hour a day of your personal time to manage your business. If you have to do everything yourself, you don’t really have a business, you have a job. With the short term rental model the business is completely location independent. That being said, start where you live.

How would you offer the instant book special on the platform?

You would simply change up the title and description of your listing to describe what your extra offerings are. It’s also possible to set up an automatic sequence that connects the guest to your offering once they make a reservation and then sets up the connection with the travel agent as well.

How soon should I be negotiating for first right of refusal for a property?

Since the caller is willing to purchase the remainder of the units in a multifamily property, it should be very simple to ask the landlord for the first right of refusal if at some point in the future they consider selling. Now’s as good a time as any to start negotiating.

What are your feelings about incorporating in another state?

This is not legal advice, but since the person resides in California incorporating in another state may save them some costs. They should consult an attorney.

What are some ways to identify the city and zip codes near me so I will be profitable?

Rather than focusing on the money, think about the person you are going to serve. Profits can become a function of additional services regardless of zip code. Think about what your customer is coming to do, and then think about how you can be near where and what that is. That will tell you what area you should be looking at.

Do we have a master tech guru playbook?

Most of this information can be found in Module 3 of the Mastermind Course. Once you work through the info you may not even need the tech guru.

How can I find a runner to do some physical tasks?

You will have to go through a number of vendors before you find the right one to handle your physical operations. It’s unavoidable but necessary to do the work.

A question about a short term rental opportunity

The caller is considering an opportunity to create a short term rental in his parent’s basement. The caller should look up CPTED if they go this route to make sure the unit itself is more secure. He would also have to consider the noise levels and if that would be an issue. Trash will also become a challenge.

One of the caller’s concerns was the walk score of the unit, but that may not be an issue depending on who they want to serve and what those potential guests expect to do.

Between the two units, the only difference is the commitment, since he will be spending roughly the same amount of money. A good resource to check out is episode 320 of the Cashflow Diary podcast.

How do companies have multiple units in Denver when they only allow one primary resident?

These companies are much larger and usually VC funded, but they are running a very similar model. In the case of Denver, always read the ordinance because most of the ordinances will cover the where and the how. Very few of them completely restrict the model entirely. Short term real estate is often zoned differently and is not covered by the ordinances posing the issue. A minimum stay requirement can also help you deal the problem.

Do you think a short term rental with a walk score of 0 can work if it’s a 20 minute drive to most local attractions?

The short answer is yes. It’s not about the real estate, it’s about the experience on the piece of real estate. A walk score does not determine whether a property will work or not.

Can I get a cosigner to get an apartment and what percentage is good to return the favor? What happens if the landlord learns that the property is being used for a short term rental?

We always operate transparently, the landlord should already know what the intent is so there are no surprises. A cosigner is definitely an option. Check out the Mastermind Course to find out more and listen to episode 548 of the Cashflow Diary podcast.

I just started Airbnb three weeks ago and am having a challenge of not having any guests?

We don’t do Airbnb, we’re in the short term rentals business. Airbnb is one of the marketplaces that we use to market the business. In the case of not having guests, without knowing what system you’re running it’s hard to give specific advice. The first thing is to always start with who you want to serve and then building your business out from there. Check out cashflowdiary.com/star to l...

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