Welcome back to the Short Term Rental Riches podcast.

Happy you’re here again.

I just got back from a little trip to Miami.

I was at an industry conference, getting the latest and the greatest from a lot of the big names, Airbnb, booking.com and a lot of software companies.

So I’ve got some takeaways for you.

Stay tuned and we’ll jump right in.

Welcome to Short Term Rental Riches.

We’ll discuss investing in real estate, but with a specific focus on short term rentals.

Quick, action items to acquire, manage and scale your portfolio.

I’m your host, Tim Hubbard.

Well, welcome back to the show again.

I hope you’re doing well.

I just got back from Miami, up from Columbia, South America.

Actually, one of the closer trips, commuting back to the United States, only about three hours, straight shots, so not bad at all.

And it was nice exploring Miami.

We hung around for the weekend and kind of made a trip out of it.

So I was at the HostChella Conference, not to be confused with Coachella, which I went to multiple times in the past, gosh, probably a decade ago over by Palm Springs where they have all the different artists come in and over a weekend.

That was a lot of fun.

But no, this was HostChella, put on by HostAway, which a lot of you’ve probably heard that name before.

They are one of the largest and leading short term rental property management software solutions out there.

They also happen to be the one that my team and I use.

We are not sponsored by them, but I gotta say after the conference and even leading up to that, I think they’re doing a really good job and they’ve got a lot of things they’re working on.

We know that not all of our property management software platforms are created equally.

Some do a really good job at some things, but not others.

And so I would say across the board, HostAway does a pretty darn good job.

If you’re out there and you’re not quite using a property management software platform yet, well, this is what’s gonna allow you to be on multiple channels at the same time.

It’s going to help you manage your calendar.

It’s going to help you integrate to a lot of cool tools like dynamic pricing, software tools, guest verification tools, digital guidebooks, all of these things.

So they’re kind of like the center hub for your short term rental.

And the more short term rentals you have, the more necessary a property management software program becomes.

So let’s just jump off with a couple stats.

So all the big names were there at this conference.

And that’s one of the reasons I really enjoy and feel it necessary to go to these conferences to learn the latest and the greatest and to report back to you.

So I hope you’ve been enjoying the show.

If you haven’t already left a review on Spotify or iTunes or on YouTube, if you’re catching the video version of this, well, I’d really, really appreciate it.

The fact is, we’ve had like nearly a million downloads and I only have a little over 100 reviews.

So if you’ve been tuning in, if the show at all has helped you, it really means a lot to me if you just head over there and leave us a quick review.

So Airbnb just had their second billionth.

I don’t know if I said that right.

They’ve had two billion guests enter Airbnb properties now.

So two billion reservations.

Can you believe that?

That is a lot, right?

booking.com does about 1.7 million room nights every 24 hours.

So I know a lot of you out there are not on booking.com yet.

The reality is, is that they are the world’s largest online travel agency.

So yes, they are bigger than Airbnb.

Their presence isn’t bigger, I should say, in the United States, but it is growing.

And so they have a big international audience outside of the US.

It’s a really, really strong OTA, and they have made a lot of improvements.

So I highly recommend that you jump on there if you don’t already have your properties listed there.

One of the sort of side effects from being on multiple listing sites is what they were calling at the conference the Billboard effect.

So these OTAs like Airbnb and booking.com, they know that people find the property originally on these sites, and then they find a way to book directly with the owner.

And so if you don’t have a direct booking website, again, having one of these property management solutions like HostAway is going to allow you to easily create that and to take direct bookings so that you’re earning more from each reservation and that your guests are paying less.

And so this happens, right?

Someone goes to booking.com, they see your property.

Maybe that’s because you have your property branded.

Maybe that’s because you had a little logo in your image, which they don’t actually allow, but it doesn’t seem like they’re just taking them down because of that.

So be careful with what you put in there.

But if you have a name for your property, for example, and it’s in the listing description, Tim’s Property as an example.

Well, people are going to know that, hey, there’s a possibility that this rental is available at timsproperty.com or something like that, right?

So of course, you can go to Google, which if you’re not on Google Vacation Rentals, highly recommend that you jump on that as well.

Again, that’s another platform that’s going to link to your direct booking website, allow you to take reservations with zero commission.

So if you’re not on these other listing sites already, remember, even if you don’t get reservations there, it’s very possible that they could be driving more reservations back to your direct booking website.

So jump on there if you’re not there already.

So let’s talk about some of the trends that these OTAs are seeing.

So one of the ones that Airbnb mentioned is what they’re calling destination dupe.

So instead of you heading over to Lake Como, Italy, a really famous tourist destination, a lot of people are opting for the close by second best option, which in this case would be Lake Maggiore.

So Airbnb is seeing this.

People are getting squeezed a little bit.

They’re looking for slightly less expensive tourist destinations, but very near where the principal destination would be.

So as an investor out there, this should give you a little good insight, right?

Aside from the fact that these properties outside of more popular areas or outside of dense urban cities are generally a little cheaper, they’re also growing a little more in demand just because of the demographics, because of the economy.

People are searching for slightly cheaper options.

One of the other benefits in some of these tertiary markets, we call them, so outside of the bigger, more densely populated areas, is that a lot of times they have less regulations in just a second here.

But that is again another benefit.

Of course, we don’t have as much data in these tertiary markets.

And so when you’re doing your underwriting, if you’re looking to invest in one of these places, you got to be a little bit more careful.

One other thing that Airbnb is noticing is that people are adding properties to their wishlist a year and a half in advance.

So the wishlist, if you remember, is there’s a little heart when you look in an Airbnb listing.

This is specific to Airbnb, but most of these listing sites have some way to save your favorite properties.

And so, if you’re not available a year and a half out in your search results, so we know we have this option, how far out do you want to open up your calendar?

The further out you’re open, the more people will find you.

And if you’re in one of these highly competitive tourist destinations, people are going to be saving you to their wishlist.

And if you’re not available on the calendar, well, then they can’t save you to the wishlist.

So aside from just being more available, this was clearly brought up by Airbnb because they just like properties being more available, right?

They really give you a boost in presence the more flexible you are on their listing site.

So the more flexible your cancellation policy is, the more open your calendar is, the more flexible your nightly stays are, the more you’re going to show up in these listing sites, they want to get your property booked so that they can earn their commission.

So keep that in mind and remember that guests are booking later and later and more last-minute than they ever had.

Okay, quick note on regulations.

Someone with a rather large property management company, they did a whole breakdown on it.

And I thought the way that they laid it out was pretty straightforward.

One thing that you will undoubtedly gather from this is that regulations can be different across the board, across your neighborhood, across the city.

There’s literally thousands and thousands of different regulations out there.

And so we have to stay on top of these.

If you don’t want to track your city or the changes or file your permits yourself or pay the taxes if you have to remit those on your own, we recommend a company called the Avalara.

Again, not sponsored by them, but you can check them out, A-V-A-L-A-R-A.

And this is what they do for a small monthly fee.

They can help you out with your property.

I’ve dedicated years and hundreds of thousands of dollars through trial and error to figuring out how to manage my personal portfolio remotely.

And it wasn’t always easy and it took a long time.

But now my amazing team can professionally manage my properties without me.

And good news, our team can also manage yours.

Let us save you the stress and headaches and some money by offering you an industry low fee.

To find out more about partnering with us, head to strriches.com, hit the property management button, answer a couple of quick questions and meet with me personally.

That’s strriches.com.

Rest easy knowing that with my team, your properties will be in excellent hands.

So just to break down the process into four quick little steps, the first sort of major rule that pops up in a lot of these cities is they’re a primary residence requirement.

So do you actually need to live at that property to operate as a short term rental?

And if you’re living at the property, then that means obviously you can’t rent it out the whole way through the year.

But some cities, some places have gotten really strict.

Sacramento, where I’m originally from, has implemented this same rule.

So that’s the first thing to keep an eye out for, especially if you haven’t quite bought your first short-term rental, you want to make sure that you know the license requirements in regards to whether you need to be a primary resident or not.

The second piece is what are the license requirements?

And sometimes there’s multiple pieces to that.

So sometimes you need a tax certificate.

Sometimes these are annual fees.

Sometimes they last a little bit longer.

Sometimes the application process is going to require you to notify all of your neighbors or all of the housing within a perimeter around your property.

So the good news is a lot of this information is a lot easier to find than it used to be.

Airbnb has a lot of it right on their website, but you can just Google your city now.

Make sure you Google your county.

Make sure you Google your neighborhood because these laws do change, sometimes from street to street.

And to come to the third point around regulations, and one of the reasons why these laws do change sometimes street by street is because of zoning.

So we know that within a city or within an area, there’s all different types of zoning, right?

There’s residential zoning, there’s commercial zoning, there’s agricultural zoning, there’s mixed use zoning, where sometimes you can have commercial and residential sandwich together.

And I know there’s a whole bunch of others out there, but this is often one of the first places the cities and the regulations are going to start.

If you have a property that’s commercially zoned or you’re in an area that’s commercially zoned, that’s usually a little more lenient, but you definitely have to check the zoning requirements.

The fourth piece to this sort of regulation puzzle, which changes drastically depending on where you’re at, is is there a nightly booking limit?

So sometimes short term rentals are allowed, but you might only be able to rent your property for 180 days a year, for 90 days a year.

And sometimes the definition of what a short term rental is changes within your city.

So that might even be six months, less than six months, they might consider that a short term rental.

Most cases, it’s 28 to 30 days, but again, you’ll want to check this.

If you don’t want to do this yourself, head over to Avalara.

They also go by MyLodgeTax sometimes.

They also have a lot of good information on it.

It’s something that’s really important.

It’s something that’s changing all the time, right?

So okay, so back to a couple quick little travel predictions put on by Expedia.

So we know that Expedia owns VRBO, right?

So they’re a really big presence in the travel space.

They do their own market study every year.

And this most recent one pulled people, over 25,000 people in almost 20 countries.

Expedia came up with some very similar insights as did Airbnb.

And that is that a lot of people are opting for slightly cheaper destinations now.

And so they called it not destination dupe, but detour destinations.

And so an example of that might be going to Cozumel, Mexico, instead of going to the more popular Cancun, Mexico.

These detour destinations are going to have a little less tourism.

They’re going to be a little less crowded.

And yes, they are going to be a little cheaper.

They also found that TV presence and social media presence is actually having a really big impact on demand in certain areas.

And so they were able to correlate the amount of social media presence and videos and all those types of things.

Videos have gone viral and the amount of tourism happened in those areas.

So it is a real piece.

We know that to have a successful direct booking website, we have to get the word out somehow, right?

So a lot of times that starts with just having repeat guests, but social media, Instagram, you know, all these different types of things are going to help drive more traffic back to your property.

And Expedia’s reports proving this, that it actually does make an impact.

Thirty nine percent of travelers prefer to be near a grocery store.

And so this is coming from Expedia again, that also owns VRBL.

But that’s an interesting, interesting insight, right?

It also means that a lot of people are very likely saving money on going out to restaurants, but they are also staying longer in the property.

So if you’re near a grocery store, or even if you’re quite a ways away, you always want one in your guidebook, right?

We know that people are going to want to go to the grocery store.

So have some recommendations for them, make it easy.

And one just sort of last insight I want to leave you with is that only 60% of hosts out there are actually dynamically pricing their properties.

Meaning their prices are changing every day, which we highly recommend.

If you’re just tuning in to the show, my team and I have managed over 40,000 guests now.

We’re in seven countries and nearly 20 cities.

We love working with partners around the world in dynamic pricing and revenue management and listing optimization.

These are things that we love to dive into.

And so there’s a ton of opportunity out there.

60% or 40%, I should say, people are still not even using these tools, which are so easy to turn on.

We know that there’s a lot more that goes in to actually creating a revenue strategy.

But having the tools to start is the first step, right?

So if you don’t have a dynamic pricing tool that’s helping you with your property, I highly encourage you to get one.

If you’re not using a property management software, well, I highly suggest that you use one.

There’s lots of integrations with them that can make your operation a lot more efficient and make your guest experience better.

So I hope that gave you just a little bit of insight.

There’s a lot of new things changing coming out, AI, a lot of changes always happening with the OTAs and travel trends and all these types of things.

I hope you’ve been doing well with your short term rental.

I hope these episodes have provided you a little bit of insight and helped you out in some way or another.

Until next time, I hope you have a fabulous week.

Whether you’re just getting started or you have dozens of properties, one thing remains the same.

Poor management can crush your investment returns.

Our team has learned a lot managing over 40,000 guests, and we’ve compiled our biggest takeaways into a handy guidebook to help you better manage your property.

Equipped with checklists for guest verification to pricing strategies, it breaks down our whole process from start to finish.

Best of all, it’s free for you for being one of our loyal subscribers.

You can get your copy by going to strriches.com.

That’s strriches.com, and I hope it helps you earn higher returns with less headache.