Real Estate News Radio with Rowena Patton

From Market Trends to Airbnb Profits: A Guide

July 28, 2024 • Rowena Patton

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Ever wondered how price cuts in real estate can predict future market trends? Tune in to our latest episode where we chat with Michael from San Antonio, Texas, who's been eyeing a move to the mountains for over a decade. We dissect the current real estate landscape in San Antonio's 78237 zip code, offering a data-driven look at how significant increases in price cuts could signal upcoming price drops. We also explore crucial factors like days on market, mortgage rates, and inventory levels, giving you the insights you need to navigate a potentially volatile market.

But that's not all—we switch gears to the short-term rental market, examining the ripple effects of longer days on market and imminent price cuts on home sales. We delve into the tightening of bank appraisals and the emerging trend of certified pre-owned (CPO) homes. Hear firsthand from investors and Airbnb hosts grappling with the complexities of short-term rentals, including regulatory challenges and financial dependencies. Our guest experts shed light on how these market shifts are changing the game for average homeowners and investors alike.

Finally, we underscore the often-overlooked heroes of the short-term rental business: cleaners and maintenance crews. Discover the best practices for effective property management, from pest control to syncing calendars across major platforms to avoid double bookings. Learn why networking is your secret weapon and how platforms like STRCPO can connect you with reliable service providers. We also share essential tips for choosing pet-friendly flooring and managing guest amenities, ensuring your property stands out in a competitive market. Join us for a comprehensive guide to mastering the real estate and short-term rental landscape!

Speaker 1:

This is the Plain English Real Estate Show with your host, rowena Patton, a show that focuses on the real estate market in terms you can easily understand. Call Rowena now. The number is 240-9962 or 1-800-570-9962. Now here's the English girl in the mountains, the agent that I would trust, rowena Patton.

Speaker 2:

Good morning and welcome to the show.

Speaker 3:

Good morning Ro. It's Michael. I live in San Antonio, texas. As you know, I've been bugging you for a decade and you've been sharing homes in the mountains with me for that long.

Speaker 2:

Hey, no worries at all. I literally have people I've been working with since I started in real estate here 17 years ago, so please don't worry about that. It's an honor to help you.

Speaker 3:

I feel like, with what is happening in the economy, as well as what just happened with our former president, it might be time to get out and live the dream in the mountains.

Speaker 2:

Might be time to get out and live the dream in the mountains. Well, you know, that's one for you and your family, to really make sure you're making the right decision. Only you can decide when the time is right for you. Many people are doing that, of course, and moving here to the mountains is kind of an escape, I guess. But of course, the climate here is wonderful. We have great food, food. There's lots of farm to table.

Speaker 3:

So, yeah, it's a great place to live how fast do I have to get out of here? Can you use your tool to look at the numbers for here? Thanks you, and I wouldn't work with anyone else and I so appreciate you working with me for all of this time.

Speaker 2:

Oh, that is so sweet and it's absolutely an honor. Like I said, Okay, let me go look it up for you and we will do a deep dive. And if anybody wants these figures, by the way, give us a call at 800 570 9962 and we can dig into yours too, 800-570-9962. And I'll do price drops or values or anything else. I'm going to send you the reports on these as well so that you can see them, and I can do this for any zip code in the USA. There's 30 data points, so we're not going to cover all of those. So these are all figures from as close as we can get to most recent figures. So, for example, 2024,.

Speaker 2:

I like to start with the price cut data, why, when you see price cuts, that's what we call a leading indicator for prices falling in the coming months. This means that people are out there listed. They have the homes for sale now and a percentage of them are cutting their prices. So, for example, back in 2017, 4.6 of the homes listed had a price cut in your area. And I'm looking at zip code 78237 right now, San Antonio. I can literally get it down to zip code 37 right now, San Antonio. I can literally get it down to zip code and when we look at 2018, that goes up to 19.3. So this is, you know, coming towards COVID here and then it drops down. Then, back in 2021, we had 0% were cutting their prices and then we start to see the incline coming here. So only 3.5 percent of all those listings had price cuts in 2022 19.3 percent. That was a big jump last year. So one in five people who were listed last year cut their prices. However, 2024 so far, it's nearly 39% of people. So people in San Antonio. That means what does that mean? You know, 78237. So people in San Antonio are looking at their listings and they're going. Some of them are going. We really want to sell and we're going to cut our prices. They're seeing all the other price cuts going on, both in San Antonio and around the country, and they're cutting their price so they can get sold. So price cuts are very, both in San Antonio and around the country, and they're cutting their price so they can get sold. So price cuts are very, very important.

Speaker 2:

Now, you're not necessarily, if you're buying, you're not going to necessarily see those prices drop until September, October, November this year. Why? Because we have a lot of people listing now that are cutting their prices. Let's say it takes them another month or two to actually get under contract and then it takes them another month to six weeks to actually close. Once it closes at that lower price and that lower price gets recorded, that's when you'll see this severe downward pressure on pricing. There's downward pressure on pricing now because all the sellers out there see all of the other homes that are having price cuts and any of the smart agents are saying that's uh, the word for intelligent in england, by the way, not not smart mouth all of those agents that are actually looking at the what's going on in their market in san antonio and noticing all of the price drops and they're passing that on to their sellers who may be thinking it's like a couple of years ago when there were multiple offers going on and everything else.

Speaker 2:

So let's have a look at home value. What is it saying about home value? You have a score of 22. What does that mean? A mid score is 50. So you've got 22. So on all of the forecast pieces on there, it's looking like we've got a price going down. Now they're looking at to come up with that score. They're looking at recent depreciation days on market mortgage rates.

Speaker 2:

Of course that changes for everybody. Inventory and the number of price cuts, that's the way they actually calculate that. And we can do lots more for you. Home value growth year over year, that kind of thing Also, is it overvalued? This is a fascinating one, and again they look at all kinds of different scores on there. The trajectory is actually going down for those values. And again I can send you and I will send you at the end of the show today a complete report on this. And remember, just because you're not in San Antonio, I can do this for you anywhere. So give us a call 828-333-4483. We have operators standing by ready to take the call anywhere in the country. Good morning Linda. How are you doing today? Tell me about where you're at, hey it's Linda.

Speaker 4:

Good morning, ro. I live in Raleigh and I am wondering what that nifty tool you use says is going to happen in Raleigh. I know you do something like the forecast and price cuts, as I am so sorry.

Speaker 2:

I won't mention his name because you didn't, and I'm not going to mention the name of the kiddo either, because you didn't Give me permission by, you know, saying whatever is out there that I can use. But you know, I'm going to keep all this very confidential. Obviously, if you don't want it live on the radio, you can just say you're calling in for a friend 828-240-9962. Or we've got people standing by 24-7. Seriously, they're on at 2 o'clock in the morning 828-333-4483. Maybe you do the night shift? 828-333-4483. Maybe you do the night shift? 828-333-4483. Just make sure you leave an email. You know you can explain your situation. If you want to, I'll definitely call you back or you can just say listen, I just want to report. I don't want to talk to that annoying woman. I can't stand her English accent. I just can't talk to her anymore. Okay, we're looking at Raleigh. So unfortunately, I don't stand her English accent. I just can't talk to her anymore. Okay, we're looking at Raleigh.

Speaker 2:

So unfortunately I don't have the zip code for Raleigh. I do of all this time I've only got Raleigh in on there because I don't know. Maybe Linda didn't want me to know exactly where she lives, maybe she thought I'd stalk her or something I don't know. But, linda, give me a call on your actual address, your actual address. Obviously, I'm not going to do that live on the show because I don't want to put it out there, because there are weird people who are stalkers out there. I am going to look at the neighborhood around Shaw University. If you're in Raleigh, you know where that is. Raleigh is about, depending on which part of Raleigh, about four hours from us. I do have the top 2% agent there that I work with all the time and she is standing by waiting to take your call, linda, anywhere in Raleigh. So that's the good news there. She is amazing, amazing lady and amazing team.

Speaker 2:

So I'm looking at the zip code, 27601, which is Raleigh. I'm going to give you the main figures in here. So the home price forecast is a number. I won't go into it in depth. I'm happy to give you the main figures in here. So the home price forecast is a number. I won't go into it in depth. I'm happy to do that on the phone, but 50 is the baseline, if you like. It's actually a very nice way of looking at the home price forecast, because when we do it by months of inventory it's sort of confusing like six months in inventory is the baseline inventory. It's sort of confusing like six months in inventory is the baseline. That's it. That all sounds like real to talk to me. So when you say 50 and the baseline is 50, that tells us is it a buyer's market or a seller's market. So 27601, this might surprise you.

Speaker 2:

The home price forecast is 40. That means, according to the home price forecast, we're expecting prices to go down. Recent appreciation is at 50, which is about average. Quite honestly, let me bring all those up and I can tell you what they're at. 40 is actually quite low. However, in the investor forecast, it's strong right, because from an investor perspective, it's fairly safe. So when we're looking at home price forecast, it's the momentum.

Speaker 2:

I don't know if you want all this detail. You probably just want the numbers. Quite honestly, it's based on fundamental stats like appreciation, inventory, price cuts and days on market. So for those the price forecast what it's doing is it's taking all those figures and looking at what's happened in the last few years. I'll give you an example of what this looks like. So in 2017, we're at 59. In other words, a seller's market, 50 is the baseline. Once we drop below 50, it's a buyer's market. And then in 2018, we went down to 48. So that's basically balanced just below the 50. Then in 2019, we went down to 35. Again, we're talking about that one zip code and then 2020, we bounced back and went to 54. It's kind of balanced. It's just four over the 50. So, in other words, we went into a seller's market. So 2017, seller's market 2018, basically balanced. 2019, definitely a buyer's market, just before COVID, or sometimes COVID, depending where you're at and as it was rolling out. Am I right there? 2019? Have I forgotten so soon? That's correct.

Speaker 2:

Yeah, so it was the end of 2019 was COVID? Covid has a big effect on this. So then we're at 54 for 2020. So, balanced market. Basically, it's a little bit you know, slightly a seller's market, but I wouldn't really count that One piece of data can floor it. 2021, pretty much the same thing. Oh, 2022, that's when we were getting all the multiple offers and a lot of you are still in that mindset.

Speaker 2:

74, home price forecast. It's going to go through the roof. Oh my gosh, because it was going through the roof. Oh my gosh, because it was going through the roof. That was the trend. That is a massive climb. 74. Guess what? We're at 49. So technically at 49, sorry, in 2023. Now we're at 40.

Speaker 2:

40 is most definitely a buyer's market according to these figures. And even if you don't believe the figures, look at the trend. The trend is what's very, very, very important the rents are going through the roof. The valuations are all over the place If we go down to that same zip code. So this is for you, linda, again, get me your actual zip code and I can help a lot more with that. Obviously, let's go down to I want to go price cuts, because that's the one, honestly. Honestly, I love to look at OK, so let me click on that. Ok, so price cuts back in 2019 are at one in five. We're doing about one in 10 right now. So, out of all the listings that are out there, it's actually more than that we're doing over one in 10 has a price cut. That's a leading indicator, right, it's above the line. So that one's interesting.

Speaker 2:

Let's look on days on market and a lot of this is historic. It's where is the trend going, the days on market. So this is showing a vibrant market, right, and it's hard to understand because I just said, the forecast is down. Well, that doesn't. That's not what's happening now. Remember the timescale we did earlier the price based on price cuts. Now, that isn't going to come through in your market until September, october, right, because that's when the houses that are having price cuts now they're going to go under contract. It takes four, six weeks for them to close. Maybe there's issues on the inspection, something else. It closes, right, and you, you're not going to. If you put it on the market, you're not going to sell it tomorrow. So september, october is when those deeds get reported and the newest deeds that sell, the newest prices that are recorded are the ones that are going to bear. If it's like your house, those are the ones that are going to bear most weight for the appraiser.

Speaker 2:

And, trust me, banks. You probably know this. Banks have really tightened up. They've been tightening up for the last year or two. Banks know it's coming. The interest rates are high. So many loan officers have lost their money, lost their jobs. So many bank branches have closed down. Go look it up. There's a leading indicator, guys. And why is that important? Because they've really tightened up. That means they're looking very, very carefully at appraisals.

Speaker 5:

Hannity here, talking with the only real estate agent in your market. I recommend Rowena Patton with All Star Powerhouse. So now that the market is normalizing again, how's that going to impact home selling right now?

Speaker 2:

You know, Sean, that's a great question and people all around the country are asking it. I'd really like them to know about the cash CPO offer. It's certified pre-owned. About the cash CPO offer it's certified pre-owned. Homes are inspected Often, they're appraised and cash CPO offers sell for 11% more and twice as fast and there's no hassle of the showings. So is now the time to sell.

Speaker 2:

You know, Sean, it's really all about do you want to sell now or not? Are you just dipping your toe in the water? If you want to get top value, sell it now. You've got a small window before we expect to see that real flatting out the market.

Speaker 5:

Call Rowena Patton right now at 828-325-8000. 333-4483. Or online at mountainhomehuntcom.

Speaker 2:

I am so happy. Today we are talking about short-term rentals. People are unhappy with them, people who are happy with them, people wondering what the heck is going on. Are they going to be shut down? Hotels that are concerned that it hits their vacancy rates, people who say that it makes rentals much more expensive and it's cutting down on homes that are available for people to rent out all kinds of things. And, pj, go ahead and introduce yourself.

Speaker 6:

I'm PJ Glenn. I'm a short-term rental investor here in the western North Carolina area. I own a number of short-term rentals just west of Asheville and also in the long-term rental business as well.

Speaker 2:

Absolutely so, you know. I want to start off with a quote from Lisa Cameron, who's an Airbnb host, and she says there's this assumption that only rich people are making money off multiple Airbnbs, but it's average people like me that depend on short-term rental income to sustain their lives. She's an Airbnb host who got hit with a $500 fine. It's not fair and there has to be a happy medium. She says so let's talk about what's going on around the country right now in terms of short-term rentals, and there's a lot of cities out there that are trying to shut it down. Basically, Do you know anything about that?

Speaker 6:

Well, we've got places like Wilmington and even here in Asheville where they're regulating more and more on the short-term rental world, and that's something you need to consider when looking at a short-term rental is where's the politics in the area at that? Point what's the temperature in the room and before you do make such an investment, you know, know kind of what's coming and what the law is really, what's currently in place and whether or not you know you may or may not be grandfathered into that.

Speaker 6:

So, you need to be thinking about those things ahead of time just in case you need just like with any other business you know, so you can pivot and make moves and you know, kind of regroup and move in a different direction if you need to.

Speaker 2:

Well, I think the issue as well is that you never know when those laws are going to change.

Speaker 6:

like anything else, you don't, and I think even here in Buncombe County, you know, this is kind of it's been brewing for a while, I think, but in the last year or so it seems to really be garnering some steam. And I know if I personally don't have a short-term rental in the Buncombe County area, but if why is? That. That reason exactly is the temperature in the room and the politics of the area didn't when.

Speaker 3:

I'm looking out five, ten years.

Speaker 6:

I didn't have a lot of faith that there weren't going to be some waves there and I just felt better that it was more appropriate for my long term goals to invest in other places.

Speaker 2:

Well, and so let's talk about the hotel industry for a minute. So in cities like Asheville, where many, many hotels have come in over the last 10 years and they're usually the big chains they have a lot of money and a lot of clout because obviously they're putting in a lot of taxes to the area. I would imagine that's partly why at least and they can afford to pay very high-priced attorneys to come in and take the case and say, well, this isn't fair. We're building here. We need the local community to do something about it in terms of offering all these Airbnbs and therefore taking up the vacancy rates.

Speaker 2:

But I want to come back to Lisa for a second, who was saying people assume that it's rich people that make money off Airbnbs. It's kind of the same way thinking that rich people make money from having franchises for McDonald's or something like that. Right, because aren't the vast majority of people that invest in Airbnbs mom and pops, as we call them, like small businesses, families who go? We've inherited this house. Maybe let's turn it into an Airbnb, or we've got a little bit of money, maybe somebody's passed or they've inherited some money, and what can we do? Maybe we'd like an Airbnb and I think maybe that comes from as well, all the boomers who have this dream of retiring and running a bed and breakfast.

Speaker 6:

Right? Well, that's certainly true. I think you know a lot of times that does happen. A lot of times, when people get into this, they've inherited a property and the first thought is, hey, we see all this, we saw this, all this action going on with Airbnbs and well, let's just make an Airbnb. And I don't necessarily think every house is correct for an Airbnb. Most of my properties are in more remote areas, with distance between me and the next neighbor.

Speaker 2:

Why do you mention that? Because neighbors get upset sometimes when they have the app Sometimes neighbors get upset in neighborhoods and neighborhoods.

Speaker 6:

You know again you know, before you make, before you sign on that dotted line, you really need to read, read the neighborhood, read the room and see if this is an appropriate place. Just because it's legal and just because there's no at that moment, no, no no law saying no restrictions saying that you can't do it doesn't mean the headaches won't be coming down the road. You need to kind of weigh out the options. Is this investment better, possibly for a long-term rental, or would a short-term rental be appropriate here?

Speaker 2:

And most of the time you can do the 30-day rentals, even in neighborhoods it's very hard to restrict that and even in the city you can do 30-day rentals because they're not short-term rentals, because they're 30 days and you've got things like traveling nurses and the demand for longer-term rentals has really gone up as people are moving. Now We've gone post-COVID Are we still saying that anymore? Oh my gosh, we've gone post-COVID, where people are moving about in the country now, so they move to another state and they don't necessarily want to buy a home right away, but they want to live in a home. I mean, you can't buy a home here in four weeks, it's not even possible. So you'd want maybe 90 days or something like that, which isn't a short-term rental? Correct?

Speaker 6:

That's correct, and you can charge a bit more for those. You can charge a bit more for that. We call them the furnished finders in the industry, but we're seeing that as a lot of people want to move in here to the area. As you very well know, you can't just jump on a property.

Speaker 3:

It's very competitive.

Speaker 6:

It's a multi-bid situation. So if someone wants to get here, maybe they need to rent for a little bit, maybe they need that three six-month lease and maybe that's appropriate for them to be in the area, to be able to be more on top of purchasing a home in this area.

Speaker 2:

So there is a demand for that as well and that's certainly something we've seen in this area, and you've got the issue too that know the natives anywhere. This isn't Asheville, it's anywhere. We have listeners all over the country. Thank you guys for listening today. You know a lot of the natives anywhere, in any city, anywhere, say we don't want these new people moving here.

Speaker 6:

Well, asheville and the surrounding area is absolutely beautiful If you've ever taken a road trip out west, and it certainly has its beauty and its charm too. But when you come back through the mountains you're happy to be home and many people they drive through and they remember us and they know that this is a beautiful place and they want to move here and that's just. We're blessed to live in a beautiful place. But a lot of people want to be here and supply and demand creates a situation where the prices are much higher.

Speaker 2:

And that's always going to be the case when people want to move to a place because of its natural beauty, and unfortunately, regardless of what you think about it, you can either be the person that is unwelcoming or be the person that's welcoming. And the interesting thing too is and, randy, you're a native, you've probably found this too is that many of the people who are complaining actually moved here from somewhere else. Very true, isn't that right? I mean, oh, my goodness, so yeah. So you've got natives who are like don't move here and therefore don't be in the Airbnb. Natives who are like don't move here and therefore don't be in the Airbnb. Then you've got people who have Airbnbs who are very happy usually to offer those longer term leases. Obviously, it's less money generally than a short term lease because those are the premium price, but it's more money than doing a six month or a year's lease generally. So there's a big opportunity there as well, obviously, correct. So I wonder what portion of people everywhere that are moving somewhere because we've all become so transient, you know, maybe moving to be nearer the kids, the vast majority, it's something. It's a very high percentage.

Speaker 2:

I won't quote the number because I might get it wrong, but the vast percentage of asset money in homes is still with the baby boomers, and baby boomer is 58 and up or 59 and up, depending on where you draw that line. So you've got people you know people who are entering their 60s right now or next year it will be 60. And they're thinking about long term care. They're thinking about, you know, getting insurance for that. They're thinking about moving into retirement community communities. They're thinking about finally, at 59, downsizing from their five-bedroom, four-bedroom houses that the kids grew up in. And now those kids are in their 30s and they've got their own families and they probably live somewhere else.

Speaker 2:

So you've got this massive. I mean some economists are saying it will be a tsunami starting next year of boomers moving out of their homes and selling their homes and that I think will create a whole inventory out there. I mean real estate. Changes in demographics are usually a trickle, not a tsunami, and it's probably going to be somewhere in between because the large number of boomers there but you wonder how many of them will be interested, especially the younger ones in their early 60s, of thinking about Airbnb and investing that money and what all that additional inventory that's coming on the market will do, because that inventory is generally going to be for younger people who have those families that want that four or five bedroom home, you know.

Speaker 6:

That's true, and one thing I think about is, you know, sometimes bigger is not always better. To this day, I've owned several properties. I've owned beach property, lake property, mountain property. Still, to this day, the number one bottom line income producing property that I own is a one bedroom 962 square foot little cabin on the side of a mountain with a hot tub and we always jokingly say it always pays the bills.

Speaker 6:

It's always been number one. So we're a larger property, you know still has higher utility costs, higher expenses and a higher cleaning fee at that. So it doesn't necessarily always produce the the revenue that you think it's going to produce. So I would caution someone. You know, okay, we inherited mom and dad's house, or you know, grandmother's house, and you know it's so big we're gonna to make tons of money. You really need to think that through first. But bigger is not always better.

Speaker 2:

And this is Rowena Patton and PJ on the Real Estate News Radio show today. If you have any questions about short-term rentals, give us a call 828-240-9962. 828-240-9962. If you're calling in from Mars, you can use the 800 number 570-9962. 800-570-9962. If you're calling in from Mars, you can use the 800 number 570-9962. 800-570-9962. If you've got any questions about short-term rentals or real estate or what's happening in the market, we're here to help and we'd love to help you with that's. It's a really fascinating industry. I think there's absolutely blossomed, grown at an incredible rate, as people know, and I guess, as as it's blossomed and a lot of mom-and-pops and a lot of investment companies are buying properties to short-term rental, or maybe it's a second home as well. We'll talk about second homes in a minute. Then a lot of people who are supporting those rentals pop up. Let's talk about that a little bit. So cleaners, for example. How important to cleaners when you can have a short term rental?

Speaker 6:

Well, cleaners are everything. Those are the backbone, those are the people that are really going to hold things together. We're truly blessed with a great crew. You know you want to find somebody that's dependable. You want to find somebody that will answer their phone. That you know there's a lot of questions you need to ask. You know, go through, walk through the house, open up drawers, look at stuff and there's going to be incidentals, there's going to be things that get missed, and you know you want to have someone that you can depend on to call and say, hey, we've got this issue, can you take care of it? I've been through a lot of cleaners and it took a long time to find the right ones, and right now we have the best and they support us, they understand the business we're in and that's the thing you always. Just want to talk to that person, have a conversation with that person. It's not cut and dry, it's not someone that just simply performs a service Right, but it's a relationship.

Speaker 2:

Right.

Speaker 6:

And that's what we have gotten in our business is that relationship, and the same goes with a lot of things. I'm very blessed that I've been able to acquire a lot of minor skills and I can do the simple repairs the plumbing, the electrical, simple wall repairs. But if you can't do that, if that's something that you're not comfortable with, you need a good maintenance person, a good handyman and having that person who's willing. You know it's 8 o'clock at night and something's not working and can you go out?

Speaker 2:

and take care of it. Something's leaking. Something's leaking Something critical.

Speaker 6:

Right. Having that person on standby. It's very critical. So you know that's another thing to think about when getting into this business is how involved can I be, how involved do I want to be, and do I have a network of people that can support where I can't?

Speaker 2:

Yes, and if you can't, you can have a management company to that. And I do want to direct everybody to STR, short-term rental, strcpo. We're building a big national list of resources for people who are interested in short-term rentals, people who support short-term rentals. So if you are a cleaner or management company or anybody that's interested in short-term rentals whether it's buying it, getting funding for it maybe you offer funding to short-term rentals go ahead and go to strcpocom. There's a link on there to enter your details and we'll share them out anywhere in the country. We're at the start of building the list. It'll take us a little while but eventually we're going to have a gorgeous map there where you can go on and find someone to call to help you.

Speaker 2:

And if you're a newbie getting into the short-term rental market, then you want to think about what do I need to know? You know, and maybe you're thinking, oh, I can just maintain it myself and you know I've got, I can go in and clean it myself or something like that. Get a quote. You know we'll have a list of people for you to get a quote from on that. But I really want to support the cleaners. You know, those people that really specialize in STR so they know what to do, because, like you said, it's not like cleaning somebody's home. When you clean somebody's regular home, you're not normally going through their drawers. But give me some other examples of that. Let's get down to nitty gritty on there. If you're a cleaner, what do you expect them to do in a short term rental?

Speaker 6:

I expect every door to be opened, every drawer to be opened. I've personally never had this happen, but yeah, I've read stories about where a guest might have left their firearm in a drawer somewhere and the cleaner didn't open up the side drawer when doing the cleaning. And lo and behold, you know, the next guest comes in goes to put their keys in the side drawer. And then there's a firearm in the side drawer.

Speaker 2:

Imagine if a child stayed in that drawer Exactly exactly, stay exactly exactly.

Speaker 6:

So that's something we go over with our cleaners is you know open up every, every side side table to every bit in every bedroom. You know, the, uh, the chester drawers, the, the end tables, open those up and for nothing, no other reason, just make sure that a drink hasn't been spilt in there, to make sure no belongings have been left behind. You know, maybe we can perform a service to our guests. Maybe they put a diamond necklace in that drawer. We can catch that before, before it gets lost.

Speaker 2:

I'll go catch those for you.

Speaker 6:

But that's that's. That's important. But you know, looking inside microwaves and ovens and behind, behind things in cabinets, things that can catch things, things on shelves, one of my big things I ask my cleaners to do if I have a reclining couch is to make sure you open up the recliner because there's the little fold there, things that falls down, the little fold.

Speaker 6:

Things fall down there. But also there's a little fold there on the footrest that tends to get a little debris and I want that cleaned out. Yes, you know we want to have a high standard and you know, just pulling things out and you know, and just doing regular deep cleaning all the time, pulling furniture out, vacuuming behind there and overall, you know, that's kind of what we look for from our cleaners.

Speaker 2:

I'll tell you a funny story look, look for them, look for from our cleaners. I'll tell you a funny story. I once stayed in an airbnb at the beach and um the I used the stove I was heating up some muffins in the morning or something I don't know and you know the little plastic fascia that goes across the front with the clock in and the dials and all right right the cockroachaches running underneath that.

Speaker 6:

Well, the beach is its own special thing we have owned beach properties in the past and I was told new beach property owners. I said you know, when you're looking for your pest control you need to go to your next door neighbor and ask who their pest control is. Yes, because you want your pest control done at the same time they get their pest control done. That way you're not chasing each other's bugs across the street oh, oh, my gosh genius.

Speaker 2:

That's a really good point.

Speaker 6:

That's what we did so we had three houses in myrtle beach and what we did was we would just get with the neighbors and we would all have one, one whole section of the block pest control done at one time and and that's and that proved very effective when I first moved here to dc, washington dc, I lived in an apartment building and it was an older apartment building and I wondered why there was some steel wall down behind the cabinets.

Speaker 2:

That's a little trick, apparently, to stop the cockroaches coming out. So I didn't know that. So I went out one night and I used lots of bug spray because I kept seeing cockroaches. I'm going to pull all that out, I'm going to really deep bug spray the entire apartment and I swear to you, I came home and the countertops were covered. You couldn't see the countertops with dead cockroaches.

Speaker 2:

The pest control works, and, and, and that's something I sent them next door is the problem, and that's why they put the steel wall in, so they can't travel so they can't travel back. Yeah into the apartment next door. So if you've got a condo building, that's definitely something to think about. You know where I just triggered that memory, because you said you don't want to be chasing the pests next door. I'm sure that's what happens. Yes, it does happen. You get more pests next door, right?

Speaker 6:

right, and we have a fantastic pest control system at our properties. You know we have the best in the business and get quarterly sprayings. Yeah, and you need that. You know you don't and that's another thing to consider when running a short-term rental is these maintenance costs that you wouldn't normally think of? And pest control? You know, don't undercapitalize your pest control. Don't always necessarily look for the less expensive guy. Make sure you get the right guy, because one bad review can cost you hundreds of dollars that you may never even see. Yeah, or even more, I'm sure, because you want to keep those stars high, right.

Speaker 2:

Absolutely, whichever one you're on. Oh, my goodness, we're going to have a download sheet for you. I think PJ and I can put one together quite easily so that you can look at this. It's not there yet, but you can go to strcpocom for all those resources. There is a link there so that if you are a pest control company and please share this with anybody you know who's a great pest control company.

Speaker 2:

Wherever you're listening that you know works with STRs or they're just a great pest control company. Same thing with cleaners. Do you have a great cleaner? If you've got an STR or a regular house that you know could do a great job in an STR, help them with their business. Everybody needs some help with their business right now.

Speaker 2:

Maintenance people handymen, plumbers that you know are trying to build their business. Maybe they've left a big plumbing company or a big electrical company and they're building their business on their own, or they're a general contractor or a handy person. If you know anybody that does that or you are that person, go ahead and click on that link at strcpocom and enter the details there and we will share your details out with people who are looking and you can always say no, but it's just a great source of business for you. It's all free. We're never going to charge you for it. So, yes, it's well worth looking at. Maybe we'll charge for it in the future, I don't know. But it won't be charged for quite a while and a lot of people will get your names and phone number and business and everything else. Did I miss anybody in that list there of people you'd be thinking about that are supporting a short-term?

Speaker 6:

rental. You know, I think one thing, especially here in the mountains and I know this is true over in the Gatlinburg Pigeon Forage area is if you have a hot tub, you need a hot tub maintenance guy. You need somebody that is on the other end of their phone and can help you, because a hot tub can make or break somebody's vacation.

Speaker 2:

You're right. If they want a hot I mean they're choosing a home that has a hot tub They've checked that box Right. And then they get there and it's not warm. And it's the middle of the winter. Because it's just lovely being in a hot tub in the middle of the winter. I've been in one in snow. It's just so delightful, and then it's not warm.

Speaker 6:

You've got a bad review coming now and it spoils somebody's vacation. Absolutely HVAC, but also be with a company that will come out at 10 o'clock at night. I had a good friend of mine the other day. Just the same thing happened. He had a guest come into his house and at 10 o'clock at night his HVAC was not working. He had a bad control board. We were able to get him with somebody that could get out to him within hours, but he lived out of town. He didn't have that network and you know it created a situation.

Speaker 6:

But we got through it and just through networking and knowing the right people and who we could rely on. We got him taken care of, but that's important, you know. Again, back to hot tub. Have that hot tub guy ahead of time. The cleaning crew, the maintenance people, those are people you want to have relationships before something happens. Yes, just call and say, hey, I've got this house, you know, and give them a little bit of business. You know, call that person just to build that relationship and that rapport ahead of time if that's something you're not comfortable with doing Absolutely.

Speaker 2:

And I can tell you we you know we're at about 3,600 transactions at All Star Powerhouse, brokered by EXP here in the mountains. I will also use that list to recommend you to our clients. You know that's a big client database. We've got about 60,000 people that have registered over the years that you know thinking about moving to the mountains and they want to look at properties. We've got all of those people too. So go ahead and enter your details if you want some more business at strcpocom. It is a new site, so we're building it over time and we're going to build this short term rental community because it is all about knowing the right people and it isn't something for the faint of heart, is it? Were you just going to jump into it?

Speaker 6:

No, that's true. You know, if you're considering, if you have a piece of property and you're debating between short-term and long-term, you really want to think about where your commitment level is. Are you looking for just passive income or do you want to make this a daily chore?

Speaker 2:

Yes.

Speaker 6:

And you know, if you have one, that's one thing, but it's not going to be enough to have a full-time income off of. And a lot of people don't think that. They think you throw it up there and it's instantly going to make you $40,000, $50,000, $60,000 a year, and that's just not how it works. So you really need to start thinking what are you wanting to put into this? What is your level of commitment? And then I always say that two is that number that you know. You're really starting to rethink things, you know. And the same thing with franchises. You know A lot of people who've been in the franchise business know that, and you have too, haven't you?

Speaker 3:

I have too.

Speaker 6:

I've been a franchisee of a large restaurant chain, and I know that number two was the one where you're like, wow, I've really got to grow, because this is a lot harder than number one, but it'll be easier at number three. And so at number two you're working a lot more, but if you're still working a full time job at this point, you're working a whole lot. You're working your full time job. What?

Speaker 2:

if you have a management company, what are you paying?

Speaker 6:

the management company. I personally manage all my own stuff, but I've heard management companies everything from 10% to 25%. It just depends on the level of service that they're providing. I think on the lower end they're just servicing your listing and providing the reservation. You're still managing cleanings, you're still managing maintenance and upkeep and purchasing of durable goods inside the house, and then, of course, that number goes higher. You know you get up to the 20-25%. That's going to be a complete hands-off type of experience.

Speaker 2:

When you recommend that, though for somebody that just wants one at least to get started, it might be a good idea for some.

Speaker 6:

If you really want to be hands-on, you really want to dig into this, you know, just just educate yourself. It's it's not the hardest thing in the world, but just be prepared for the unknowns, you know. Try to try to try to figure out what you don't know, and and just educate yourself. And you can go on the forums out there. There's Facebook pages everywhere and you can. But you got to be careful there too, because they'll scare you to death there they don't want competition.

Speaker 2:

Sometimes right.

Speaker 6:

Well, that's true, that's true. You really, you know you'll get some of the nightmare stories and some things you'll look at and you'll say, well, that's easy to solve. I know how to solve that. And usually the answer is just take care of your guests, just do the right thing. And if you can just keep that in mind, I also tell some people another thing. You know and I think this is one of the most important things that you can really keep in mind, what you're doing.

Speaker 6:

You know, it's not your house, it's your business. Don't take it personally. It's a business. You know, if you own a pizza place and you know the front counter gets damaged by a kid who throws a toy into it or something, that's just part of business.

Speaker 6:

Don't be that person that well, my table has a minor scratch on it. I'm going to file a claim with Airbnb. You're getting into the weeds. Just fix it and move along. Don't stress yourself out with those. If, if, if you're getting stressed out over that you're going to be getting, you're going to put a lot on your plate very quickly where those efforts could be spent in other places. So just just remember it's your business, it's not your home.

Speaker 2:

Well, sometimes it is your home too. So I had one in Black Mountain when I lived there and I'd taken on. My husband had moved out and I'd taken on the big mortgage all alone and I put a door at the top of the stairs. It was in a beautiful little neighborhood that allowed short term rentals and I met some lovely families and couples and individuals that were coming to the area. It was a really nice little Airbnb downstairs. It really didn't bother me at all. I never really saw anybody, but that was in my home, so it was actually very easy to run down and change the bed, and the laundry was downstairs too, and the only way it put me out really is that the laundry was downstairs so I couldn't do laundry when somebody was staying right, but as you know, many people stay at the weekend.

Speaker 2:

You know they're not staying during the week, or they might go home Monday or Tuesday or something. So you know that wasn't putting me out too much. But one interesting thing I learned through that is that I can tell you a funny story about the dog too. One thing I really learned from that is that year two is when it starts happening, because people start rebooking because they've had a nice experience and now you've got a bedrock of clients and it's like anything else. You know, if you're a nail salon, people come back when you've had a nice experience.

Speaker 2:

So from the launch it might not be, you know, crazy and wonderful, but it takes a while. If you've got a hair salon, same thing. Or you know, if you go to a car dealership and they serve you so well you might. I know I stayed with a certain brand of car because the service was so amazing. I mean they'd come and pick me up and it was amazing. It's just incredible. Um, and then the guy left and then I went to a different brand, literally because the service meant everything to me. So you've really got to think about it. I think is yes, you might not make money overnight, but year two you know if you give that great experience. What do you think to that?

Speaker 6:

That's absolutely true. We have many repeat renters over the years. They come back time after time and it's almost, you know, once or twice a month I'll get a message from somebody that says, hey, you know, my friend Bob stayed at your place. He highly recommended it. I wanted to reach out to you so you know you'll build up the referral and that just keeps it's. It's the snowball effect, yes. And then you just come to a point where you know a lot of people start asking like, well, are you booked every weekend? I said, well, yeah, I'm booked every weekend. I'm booked, you know, 28 out of 30 days a month and a lot of that is is referrals and it is repeats and people come back and we have families now at this point that have made traditions. They spend the same, you know, three-day weekend every January or every February at one of our properties. So that momentum builds. And the same thing, you know we look down at our lake house. People come down for football games, they come down to spend time on the water and that's tradition.

Speaker 6:

Which lake is it Lake Hartwell? Okay, so they've made it a family tradition at this point, and so we're seeing those people come back time and time again, and that's very rewarding that we were able to take care of that person and and earn their business a second, third, fourth time.

Speaker 2:

What do families say about staying in any of your rentals as opposed to getting a hotel room and traveling somewhere?

Speaker 6:

Well, the advantage to having a short being in an Airbnb or a short-term rental is you have you have the whole space. Well, and at least our properties you have the whole space. You typically have got a yard or a big patch of forest behind you or just a big deck to hang out on. We're in a hotel room. You've got 400, 450 square feet to pack everybody into and no kitchen. One of our properties is a two-story property with a big living room downstairs, and when I designed it I didn't really think about it, but we get a lot of feedback. That was the greatest place to send the teenagers. They would go play video games on the big screen and the adults would stay upstairs on the deck hanging out and grilling or cooking or just spending fellowship with each other. And I never really thought of it that way, but it was a separate space and you don't get that with hotel rooms.

Speaker 2:

Right, right, and a family gathering place Instead of gathering in the lobby downstairs or gathering in the hotel restaurant or something, or having to go out in the city and spend a whole lot of money. So you probably save a lot of money like that as well. Go to the grocery store. Before you go, we need a download sheet on what you need.

Speaker 6:

Oh sure, and that's you know. One of the biggest questions we get is where's the closest grocery store? I bet and so that's what we've included in our check-in guide is where is the closest grocery store, and we usually list the top three, whether that be Ingalls or Publix or whatever else is nearby. And you learn that going into this business. Questions that repeatedly get answered, and if those questions are asked multiple times, we'll put that in your guide and it will make your world a little easier just to go ahead and be preemptive and taking care of that guest and getting them the information ahead of time so they can plan. Maybe they want to pick up groceries on their way in, maybe they're coming to the mountains and I had a family that they always ask is there going to be snow? I said, well, this is western North Carolina. It could be 75 degrees one day and six inches of snow the next. Isn't that the truth?

Speaker 2:

Yeah.

Speaker 6:

But they want to pick up groceries and typically I've had people just say they wanted to get snowed in and just hang out in a cabin and sit in front of a wood stove fire and spend time with their family.

Speaker 2:

That sounds so delightful, oh my gosh. And in the summer too, I bet.

Speaker 6:

In the summertime they want to spread out a little more. The hot tub's not necessarily the most popular thing, but sitting out on the deck and grilling and you know, kids running through the woods where maybe they're from a city area or urban area where they don't get a lot of exposure to the forest. So in our particular properties we're surrounded by forest in all of them, and so they do get that true mountain experience.

Speaker 2:

Wow. So let's talk about Airbnb, vrbo. Those are the two biggest sites where people advertise. Are there others? Where do you put yours, and do you know any differences between the two?

Speaker 6:

So we're listed on several different sites, airbnb and VRBO being the top two, of course. Airbnb, I mean, we all know Airbnb. It's very diverse. It's where you can get a room in someone's house all the way up to an entire space in a 5,000, 6,000 square foot home. Vrbo, especially right now, has been pushing a marketing campaign of where you do get only the whole space and a lot of people like that. I've spoke with guests in the past and that's what they want. They're looking for privacy. They don't want to be supervised, they don't want to be looked over, and I get that. You're on vacation. You don't want your vacation micromanaged to a certain extent. But one we're seeing a lot more traffic on is bookingcom, and not necessarily the easiest website to navigate, but we are seeing more and more traction on that and I don't really know why. Maybe it's their marketing strategy, but we are seeing some increased bookings there.

Speaker 2:

I would think that's probably because they have hotels as well.

Speaker 6:

Probably so and you?

Speaker 3:

can get the car.

Speaker 2:

It's like a normal, normal regular hotel booking site, but they're throwing the Airbnbs VRBOs on there as well.

Speaker 6:

Right, right, and we've seen different properties do better on different sites. For instance, our lake property does better on VRBO for some reason. I don't really know why it just does, and when we had property down in Myrtle Beach, it did better with VRBO than it did with Airbnb. No real rhyme or reason to it, it just was what it was. But you want to be everywhere and very important. This is one of those things. Those things. Take the headache off the plate. To start with, make sure your calendars are synced.

Speaker 6:

There is nothing worse than a double booking. It's not hard to do, but just be redundant on that. Go back through your calendar, make sure you're going through 30-60 days. Just double check your calendar To Make sure you're going through 30, 60 days. Just double check your calendar to make sure that the sync did work and you don't have a double booking somewhere, because that can spell trouble.

Speaker 2:

An Airbnb, and VRBO now offer that facility right.

Speaker 6:

They do, you can sync those calendars.

Speaker 2:

Thank goodness I know that when I started I either didn't know about it or they weren't offering it at the time and that just made it a huge pain. And they do that on purpose. It's kind of like an Apple phone and an iPhone and an. Android phone. You know, Apple keeps everybody out.

Speaker 6:

Right and before you know, we operate an RV rental business as well and between the big sites, the outdoorsy, the RV share. There was issues with their calendar syncing and we ended up with double booking several times and I think they've got that mostly worked out at this point. But it can be very costly, it can be very time consuming.

Speaker 2:

And people get very ticked off.

Speaker 3:

Because, you've made your plans.

Speaker 6:

This is your vacation. You want to make your plans be done and be reliable.

Speaker 2:

And especially around the holidays. There might not be anything else available.

Speaker 6:

Exactly exactly those peak times Christmas, july 4th, Memorial Day, labor Day. You've made your plans and at the last minute, if there's a mistake, then finding an alternative accommodation is going to be hard.

Speaker 2:

Yeah, but really hard. And then what about? Let's talk about pets for a minute. What do you alternative accommodations is going to be? It's going to be hard, yeah, but really hard. And then what about? Let's talk about pets for a minute. What do you think about pets in airbnbs?

Speaker 6:

well, we, we are pet friendly and and so I, I, I tell people you know carpet is your enemy. Do not have carpet in your airbnb? Um either hardwood floors or lvt or plank um make it easier. I, most of my houses, all have life-proof flooring in them from from home depot.

Speaker 3:

I love that stuff, it's easy to clean it.

Speaker 6:

It you can't destroy it. We put it in and a couple of beach houses and if they can survive the beach, it can survive anything get his name on strcom thank you, str. Str.

Speaker 2:

Cpocom str cpocom if you Thank you, strcpocom. Strcpocom. If you're a provider for STRs, get your name in there. Thank you so much, pj. That was amazing. It's going to be podcast as well, so we can share it with anybody interested in STRs, and we'll see you on the radio next week.

Speaker 1:

Happy New Year. Real Estate Show with Rowena Patton. Visit Rowena and post your questions at radioashvillecom or call her at 828-210-1648.

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