In the short-term rental riches will discuss investing in real estate with a specific focus on short term rentals quick action items to wire. Scale your portfolio I’m your host Tim Hubbard.

Welcome back everyone to the short-term rental riches podcast hope you’re doing well out there in these courageous he times and certainly one of the craziest times for the short term rental industry but it’s not all bad I think a lot of good is actually gonna come from and we’re learning a lot today I want to give you some updates on some money that’s likely coming your way are ready if you have a short term rental that you may not know about at some financing options that are available for your short term rental business even if you only have one unit some of these options will be available for you and then also just a couple quick notes on how this is going to affect us in the future or how likely could affect us so let’s get into it I hope you find some value in this and again I hope you are staying safe staying healthy hopefully you’re getting some time with your family and to catch up with loved ones a German talk to while if you’re in quarantine I’m still in quarantine down here in Florida plus Brazil but it’s not too bad Kansei thing I kinda locked out overnight a place and with a good friend and we just run into place a little more long term since we don’t know when we can actually leave by. You know I’ve always work from home so that part hasn’t changed too much grocery stores are full so I can’t complain down here I hope you guys are doing well out there I want to give you some quick updates on my business though and how mine is change and just reiterate a couple of the things that I’ve done I’m still getting reservations which is great and some of the decisions and I’ll be making Ford’s self just to re iterate some of the tips from the last podcast you’ve likely had to cut your rates drastically what we want to be careful that we don’t cut them too far there’s a certain point where you just start to track to gas that maybe you don’t want and they could take advantage you know or use your rental in a way that you don’t want so you kind of got to find that sweet spot I’ve set mine up with my automated pricing so that it to docks 20 percent off my base price so I’m I’m going up to 20 percent less than my lowest base price but that all depends on demand day of the week all the different pricing dynamics that we talked about before so that’s one of the things hopefully done already in that you’re keeping a close eye on the others changing your cancellation policies so I’ve set all mine to 2004 hours because most of the bookings were likely to be getting now are going to be a little more last minute just because it’s very difficult if not impossible for people to travel you’re probably also going to be getting local people booking because people aren’t flying in from around the world anymore at the moment so I open that up as well I used to not accept local bookings but now we are accepting them as long as they have one positive review or more and that seems to be working I I’m getting a a fair amount of reservations and some of them are longer you may notice out as well so if you had a maximum days that. I would revisit that and then at the end of this you know times are difficult for some of the short term rental industry because travels more constrained than it’s ever been so our housekeepers in our reservation staff anyone that’s working with our business we want to do our best to keep everyone we can that’s difficult you know if you have housekeepers and there’s no reservations there’s not a whole lot you can do we’re gonna talk about some financing options that are likely available for you and likely available for housekeepers as well so we want to try to save definitely our best people so we can come out of this stronger than ever with that said those are just the quick changes that I’ve made it’s working well enough but there are some financing options available for your short term rental business for you as an individual for your housekeepers and some financial aid just to get through these times if you unfortunately have lost your your job or your financially impacted by this self the first one and this one ‘s going to everyone you want to check with your CPA on all this I’ve done quite a bit of research talking with my CPA and bookkeepers and and other CPA’s as well just to get a consensus but again you want to double check with them but I want to give you a little synopsis of what I’ve been learning about the last couple weeks first off is a $1200 credit that will be mailed out or direct deposited to everyone and this is in the U. S. all of these financing options are in the U. S. so sorry for those of you that are that are outside the country now but $1200 for anyone in the U. S. that made 75000 or less in 2018 or on your 2019 return if you’ve already filed that so that’s coming you automatically if you have children I think there’s a little more coming. The next thing is the E. I. D. E. A. that’s the economic injury disaster advance that’s something I applied for it basically says if you’re impacted financially you are eligible to sign up for this anyone can and I would highly suggest that you do if you’ve been impacted so if you’re in the short term rental business you’ve likely been impacted in your reservations of gone down so you can use some of this to help with your housekeepers and and some of those fixed costs that won’t go away even if you lose your reservations so that is the E. I. D. E. A. and I’m gonna put a link in the show notes to the SPCA this is available through the small business administration by the way I’ll put a link in the show notes for all these options one that you are likely going to get money back from automatically if you’re running through Airbnb in you have short term rentals and you may or may not know about this but Airbnb is giving back $250000000 to host their sensually giving 25 percent back for any cancellations that happen I believe March 14 a month after March 14 but you can easily checked out on Airbnb is website that’s coming back to you automatically if you had a cancellation during that.. Because the corona virus 25 percent of that to come back to it I don’t think they’ve said when or where or how it’s going back but imagine it would just come in the form of the payout so that’s good news that should help a little bit so we’ve got the $10000 advance economic injury disaster dance we have the $1200 credit that’s come in anyone that may less than 75000 on their tax returns we have the money coming back from Airbnb and then there’s also another thing in this might not be available for everyone but likely for a lot of you and this is called the P. P. P. program the paycheck protection program and this essentially is going to help out all small business owners to help pay their payroll in the near future so it’s a loan but it’s going to very small interest rates and the payments will be deferred for quite a while this is all changing very quickly with the SBA so I I would check the link in the show notes just to get the latest but as of now if you’re listening to this in real time and this is where it stands as of now so this program the is going to give you 2.5 times your monthly average pay roll so it’s a loan for up to that amount now I would highly suggest so if you have employees you’re already eligible for this you can apply right now and it has to go through an SBA lender so I would check if you already have lenders that you’re working with regularly I would check with them they may have their own in house SP lender otherwise you can check any of the large banks all have an SBA lenders well but this does have to be under written by an SBA lender now starting April 10 this is available to independent contractors as well and that includes yourself if you’re paying yourself as an independent contractor or you have independent contractors that you’re paying a 10. 99 so housekeepers anyone that you’re paying a 1089 or yourself you are eligible for this loan starting April 10 as well it’s available to everyone that has employees or accompanies lessons 500 people from what I understand so this includes franchises so make Donald’s for example they won all of their franchisees to be doing as well as possible so you better believe that they were some of the first people to know about this and that they’re submitting their applications are they already have you know in the best way that they could so that includes all franchises Taco Bell so there’s gonna be a lot of competition for this I’d highly suggest just just fill it out before and 1 last thing if you have part of your team that they’re just as absolutely no work for they can file for unemployment even if they were not a W. 2 employee. So this is the first time in history and and my lifetime anyways where an actual independent contractor can file for unemployment and not only that but they’ve actually increased the unemployment to a certain amount in this varies by state so. This is good for anyone on your team that just has absolutely no work I would highly encourage them to apply for this this is also good for your long term tenants so you want to be proactive with some of your long term tenants to and send them these options as well. And let them know that there may be funds available for them some the other things you might want to consider you know this is difficult for really everyone so might want to consider waiving late fees but I think the more proactive you are with your tenants the more they’ll appreciate it and you know hopefully if they’re unable to pay ransom these financing options help and you guys can work out a plan together for them as well hopefully you’re in a position where you have been affected still working you’re still getting good reservations are staying full but if not if you’re in a hard spot I would definitely sold out just make sure talk with your CPA first just to get their advice on everything so so those are some options for you guys out there if you have been greatly affected some of those things are happening automatically some of those things are options you could take advantage of so hopefully your stain at least I know a lot of people have been putting in longer term tenants in their short term rentals and nurses is a good example a buddy of mine put some of his rentals on a site called furnished finder and I put a few mine on there that’s specifically for nurses so if if you are in an area that’s near a lot of hospitals this could be a good option for you and you may have noticed when you go on Airbnb there’s a headliner that pops right up and says help us house I think around 100000 nurses so that could be a really good option their average days 3 months their company usually pays for and they’re usually good tenants all of my properties actually in the U. S. in all 3 cities are all very close to hospitals so I’m fortunate for that I have found though after putting my listings on there that there’s a lot of competition so I think a lot of people have the same idea but it can’t hurt it’s worth checking out and that’s one of our backup plans always right so are. Our first backup plan is always run into people that over 30 days states you know business professionals are travelling nurses and then our last backup plan is putting in long term tenants in and so I said on the previous podcast I was I was setting a 2 month period if things didn’t change or improve the reality is if you have a mortgage that’s being paid especially with the multi unit property that only takes a few reservations be paid I’m gonna hold out probably as long as possible because if I were to put a long term tenants in there which a lot of people are doing and a lot of people have already done which remembers going to lower the supply when we come out of this but if you put a 10 and then for a year then that means you can’t run as a short term rental for a year if that person’s in there for at least so really calculate your numbers and and find the point where that makes sense for you if you’re getting enough reservations and covering everything already then I would hold out as long as you can because I I know that a lot of people aren’t making it through this and that I think sadly that’s a lot of people that were doing the lease arbitrage model and I feel for them they’re probably in a tough spot some of them are able to re negotiate with their landlords. And a for rent payments but some landlords are just sane now and I talked with my software management company gas the the other day who manages through their software tens of thousands of listings maybe 100000 around there and my account manager said that yeah a lot of people are back in now they’re putting in long term Tennyson and for the ones that are doing the lease arbitrage there unfortunately not able to. Change their terms so for those of you the own your properties just hang tight as long as you can I think I think we’re gonna come out of this stronger than ever there are some people that are probably doing pretty well right now with your short term rentals in those are properties that are in remote areas especially close to dense cities where people are trying to get out get some space so congrats to you guys hopefully those are staying booked into getting some long term residents in there and to everyone else hang tight and really run your numbers and decide on that point where it may make sense for you to put a long term 10 and then but I can hold out as long as long as I can. So times are uncertain right we don’t know when this is going to end but we do know that the whole world is working towards fixing that my quarantine here Brazil supposed to end on the eighth which is tomorrow that seems pretty early to me and the reality is I don’t understand how we can actually lift these quarantines if there’s no vaccine because if people are allowed to travel again and then it doesn’t stop so I’m not as intense as that on though those sides of the story but I know that we all are working towards this and hopefully you know a lot of people that I look up to and value their input information are kind of thinking this may last through late June or so so hopefully that’s the case in the meantime things are gonna remain uncertain I’m actually in contract for property supposed to close already I am renegotiating my terms. To basically say I will close as soon as the quarantines lifted so this is a property that needs a lot of construction and if I can’t do construction because of a quarantine then it doesn’t make sense for me to close on that property right now now I’m excited about the property I think it’s a great one so I’m hopeful that things will turn around soon and then I’ll continue to go through with that deal but that’s what I’m doing for that property if you’re in contract to buy a personal residence or another investment and it still makes sense is a good investment you’ve under written it with your long term tenants and I say go for it you know interest rates are really good right now so I would go through with that one the only reason I’m holding off on this one is because it it’s fully vacant and it needs 100 percent renovation it’s going to be a big job so you know and aside from that we know that travel is not gonna stop short term rentals are not going to stop and with all of the people working from home now I think a lot of the world might end up traveling more I don’t know we’ll see there’s definitely gonna change the way we we think about cleanliness and hygiene and everything for quite a while but it short terminals are definitely not going away so again hopefully you’re doing well out there you checked on some of the the things you can do right now just checking your cancellation policy adding a photo of I am a professional housekeepers or cleaning supplies and then put a note in there that says we’re taking extra measures to sanitise our property gains corona virus or whatever it is but I I’ve been adding that picture is my second one so someone sees my listen in the school over and they see that so try that try the long term sites you know like furnished rental to maybe get some longer leases in there with nurses and I would get a lease if they’re in there over 30 days let’s do. Our best to keep all of our best people keeper bass housekeepers and to help you do that you can use some of the financing options that we went over from the SP 8 again that link will be in the show notes some of the funding and financing it’s going to come the automatically in the form of tax credit. And hopefully you’ll get some of that 25 percent back from Airbnb these refunds from the cancellations between that time.. And other than that I’ll continue to do what I can on my end to bring in the best updates the best info and whatever I think may help you with your short terminal business and your real estate investing and general so hope you’re doing well out there hope you’re staying healthy until next time take care. Want to get on the fast track to financial freedom through short term rentals what all searching the properties you. You want to make sure that you acquired the right properties I want to give you my. Yes that there is no charge to you for being one of our subscribers just go to rest methods.com R. E. S. T.. methods.com.

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