I hear you on a lot of this, but the sympathy runs short when your 1-night fee is listed at $325 and yet for a 1 night booking I'd be paying $750 after your cleaning fees. Today's consumers are way more price savvy and will opt for hotels or cheaper options than be up-charged to that degree.
@@EmpoweredHomeowner It appears that way when your reasons for selling are “things are too tough” and “HOA’s suck.” Like yes im sure it does suck but so does a cleaning fee thats the same price as your nightly rate lol
Good luck to you. One of the happiest days of my life was when we sold our rental property. FREEDOM! Now the money is invested in income producing securities that require zero work or maintenance.
THIS is what happens when you don't do your homework before deciding to build a STR business .. Running a Airbnb business is NOT a real estate business !!!! It's a HOSPITALITY business . When will people learn this ??
WELL, it is not like it is common knowledge. VERY few people even talk about this. The Gurus mainly talk about how "easy" it is and blah, blah, blah. You don't get this kind of knowledge until you actually do it, just like ANY OTHER BUSINESS!
Too many idiots listened to one person on bigger pockets , claimed he/him or whatever made millions & retired from a $500k job or some other nonsense story !!
I was a 10-year Airbnb host in NYC and had a very successful venture with little to no complaints. I was near JFK Airport with a multi-family property where I rented 6 rooms individually and had so many requests for stays I had to turn down money! My situation was unique. I work for myself and reside at the property so I could dedicate full time to running it. I had all amenities near me and was minutes away from the airport. I set my price below the rate of all other area Airbnbs in addition to the hotels, plus offered free snacks and refreshments. I even used my car as a shuttle service, with prices lower than Uber. I updated my property with the money I earned over the years and slowly raised my Airbnb rate.. I offered great service and got stellar reviews and attracted guests from all over the world. I self selected guests and chose only those with 4.5 stars or higher with good reviews, especially if they were a serial Airbnb renter. I quit Airbnb once the City changed the short term rental laws and now just have a regular tenant. I'd say location, and offering unique services in an attractive property are key to being successful.
what a loss that travellers no longer can stay with you. The city is a joke and tramples on property rights. Thanks for putting your passion into your property for the short time it was possible.
@@geoffl Thank you!. Yeah I made incredibly great money, far more than what the rental market would call for, far more than I ever imagined my property could produce. Plus I can't say how much the money helped me with my finances and managing the property. They City definitely needs to reexamine its housing laws. Far too many people just trying to make a living and do the right thing are losing out.
You could see the Airbnb bubble a mile away (and by a mile, I mean like 3 years). With that said, people having the self-awareness to take your losses and walk away is in short supply these days; you deserve credit for not just acknowledging the situation but sharing it so others don't get trap in ego or delusion. I don't think you'll regret moving forward to something that'll better align with your goals.
As an Airbnb super host, I must say this was the single funniest video I have ever seen on this subject. I particularly loved the section on "updating." My "updated" bathrooms are privies with five-gallon buckets. I won't even talk about the kitchen.
I'm in east central FL. I had 3 AirBnBs. They were in an RV resort, near I-95. (My town doesn't allow STR in houses, only condos or in-law suites, while owners living in main house). So, only other idea was the park models in RV resort. Did great in winter. Ok in summer. But, August-Nov was really tough. Had to rent on month to month basis to break even, and those were the guests that trashed the places. I also was competing with the motels. I had to come in at same price, including cleaning, taxes, vrbo fees, 3% ccard fee, etc. I had to self manage & clean. Sold them in 2019-2020. It was very hard work. My suggestion, if looking at STRs as a business- run the numbers & compare with hotel rooms+all the xtras.
I totally agree with you. I have a short-term rental in Houston and it's hard to turn a profit unless you self-manage which is a full-time job. You definitely have to update your kitchen and bathrooms in order to be competitive. Then don't think you about to charge some crazy one-night stay or cleaning fee because you will not get booked because someone else is way cheaper than you for the same accommodations.
The map views of all the SRT's in San Fransisco and Orlando are astonishing.. It's almost like entire neighborhoods are all STR's... okay not really but the saturation is extremely real... that is a ton of competition as the economy slides. Once we are in recession it'll be race to to the bottom as all the STR investors fight over limited bookings.
STRs are a full fledged business. Its no longer a real estate play. If your business isn't right, the unprecedented real estate appreciation is no longer going to bail you out.
I own 2 houses near that area. One in an HOA one not in an HOA. Long term rentals in that area are in big demand. And the property tax in an HOA is less than outside an HOA, so it almost evens out with the dues plus taxes in an HOA and just taxes outside an HOA.
Hands down the best video I've seen this year. Because like most I've been thinking about having a property so I can do airbnb on the side but I have a full time demanding job like most. Gives me something to think about
I started watching you 2 yrs ago when you were just starting the channel. We also live in Chesco and had just spent a great weekend in the Poconos. We loved it so much we started looking at buying a place there. I kept watching your channel and kept monitoring listings up there, but we could never make the numbers make sense. Every reason you listed were things we noticed and it just didnt seem like we could make it cash flow like we do with our ling term rentals. Interesting to see that you've come to the same conclusion.
@@jayhoggard92 Thanks for following along! Yeah it's not what it used to be. I do believe can be successful and make a property cash flow, it just depends on how you buy it. If you're financing with 10 to 20% down it will be more difficult. To me it all comes down to how nice you can make the property. If you have a good amount of cash up front I can really dazzle it out, you will cash flow
Had a rough year on our FL spot due to large assessments, around $25k. This year seems better but I think a lot of people quit because of oversupply. For Airbnb, I think two basic approaches would work. One is running a big consistent business with staff, the other is you just want to have a place in a location and use Airbnb so you can bring down the cost of ownership.
Property managers are terrible. Yes it’s a sweeping generalization but I’ve used 4 different ones in Los Angeles. They charge a lot and don’t manage well especially when you need a plumber and you’re always dealing with plumbing problems in a rental . People are ignorant about the basics . Wipes down the toilet, 1/2 roll tp every time someone uses the bathroom.
I live in PA and personally I wouldn’t rent a home that wasn’t renovated. My home is completely renovated. If I am renting a home why wouldn’t I expect the same. The fees are too high not to be. I live in Bucks county there is no supply of home here. Only 2 on the market in my neighborhood 1 for $1.8 million and the other for $2.5 million.
Yes, I do. I think both strategies are good and can work, it just depends on you as an individual. Short term is significantly more hands on, where as long term is way less time and effort. Both have pros and cons. I did make a video about this - th-cam.com/video/bersjsd_snY/w-d-xo.html
I have an AIRbnb in one of my units in a 4 unit building and it’s doing great. My mortgage payment isn’t fully dependent on my airbnb income, that’s more of a cushion. I think anyone who buys a house solely to airbnb isn’t wise
Yep been there done that here ins massachusetts I saw the writing on the walls very early. However, I love real estate, and now I just do long-term rentals. There is no headache and no reviews to worry about all the time.
Damn, i wont complain again about the fees here in stillwater 😂. I didnt know better and was happy to get my kids away, but next one will not be in an hoa😂
What I don’t like about Airbnbs is that they charge exorbitant cleaning fees. But, do they actually clean? No! Every Airbnb I’ve stayed at was only surfaces cleaned. But guess what, they charge $400-$500 to all their guests. It’s a scam. Let’s not forget the fact that you have to clean and do laundry and dishes before you leave. Always something broken or over-used. Note: none of the places I stayed at were inexpensive by any means. Rather stay at a hotel.
Thanks for the honest content. I wonder what the next few years will bring. I imagine that there will be a significant amount of Airbnbs that sell in the near future, leaving less competition for the remaining Airbnbs. How will a sell off impact house values in the next few years? Do you see it as an end to low risk, profitable Airbnbs? or a cycle where it will be favorable for Airbnb hosts again?
@@jamesstott2378 great questions! I think if you can hang on now while the "Great Sell Off" happens, you'll be in a good position in the next few years. You just have to have the cash in order to get through it. I believe a large portion of hosts now will be gone in the next 3-5 years bringing more balance to hosts and those properties that are designed well, will do well! Could actually even be a good time to buy if you can weather the storm
there are business cycles. Covid created a lot of hype and people piled in. If you can survive through this correction and even expand a bit, you will be reward again when the supply/demand situation evens out. The key is not selling at the low.
I've been managing our two Airbnbs in Port Saint Lucie and Vero Beach for almost 2 years and I've had really good results. I can see it as something scalable and a really good business, when you automate the business it doesn't take a lot of time. I still have plenty of time for my family and my demanding full-time job. From your video, I could gather a few key mistakes starting out on the business: always avoid HOAs specially for STR purposes, not having amenities, not having a competitive/renovated listing, hiring a professional photographer and ideally a pro interior designer, being in a desirable location. That's been my experience, though. I appreciate the transparency.
Florida is VERY different from the Poconos. It is also VERY difficult to avoid HOAs in the Poconos because the majority of producing properties are located there. The location is also very desirable, but the main issues is how much competition has increased over the past 2 years.
I think it can all be about perspective. If I got into the STR business it’s to have other people help me build equity. If my mortgage is $1,500 and after AIRBNB it comes down to $300-$400, I consider that winning.
That's a good way to look at it. Also you can write off just about everything which really helps on the profit and loss tabulation. I re-investment a big chunck of the "profits" to increase value and for our enjoyment when we use our STR ourselves.
Right, I own a large home on a lot of land in a college town. I don’t have any debt but I am going to rent it out to at minimum offset taxes, insurance and maintenance. Anything over that will be a bonus. Hopefully build myself a much smaller house on the property.
I hear what you’re saying about the homes needing to be updated. The way I see it is it’s almost like renting an experience for a weekend. Tough business I’m sure. The Poconos are great. It’s like upstate also (Hunter/windom). I feel like the price are cyclical. Interesting video. Thanks for sharing your experience
While HOA's do frequently suck, they are sometimes very good ideas and are very reasonably priced. I have a relative, for example, who pays $170 per year, nothing more, for the HOA fee on her $600,000 house and her neighborhood is kept in very nice condition...almost entirely because of the requirements/standards of the HOA. She lives in a development where, if the HOA didn't exist, the complex would be a total mess. With that said, I would never live in an area with an HOA because I hate having restrictions, many of which are often far too strict.
People dumping STRs en masse is going to happen. Most of these rentals are used for vacation and business travel to some extent and both forms of that travel get decimated in a recession. The STR market is unbelievably oversaturated in places like Orlando and San Fransisco. Sooner or later the economy will find itself in a recession and there will be nowhere near enough demand to support the level of STR's that currently exist. It'll be a race to the bottom with way too many STR's competing for nowhere near enough demand. The entire business is going to shift from highly profitable to only covering a percentage of the mortgage. When you run an AirBnB you are selling time, and the clock always ticks.
You make a really good point. I've been hearing from a lot of hosts that this will happen and I believe the "Great Airbnb Sell Off" will be happening soon
I bought 2 in 2016, 3 in 2018, and 1 in 2021 and put down 20-50% so my notes are relatively low for what I have. Hopefully I can wither the storm and hold on to mine. The people that spent 500k to make 800/month will be in big trouble.
All HOAs in single family communities should be disbanded. They're not necessary. Neighborhoods have been around for decades if not centuries & the communities are desirable.
@@dandrake337 Remember that time when people who commented on a random person's video with absolutely not experience tried acting like they knew what they were talking about about? Good times.
Airbnb charges way too much and double dips from the owner as well. The tourist taxes on top of Airbnb fees ads 25% more to the cost of a night. Hotels are a much better choice and no surprises and cheaper.
I find it hilarious when you talked about the return on the investment needed to update it. “Is it going to take one year, two years…?” Major hospitality chains ROI timeframe is typically around 5 year for recoupment and reinvestment/renovation again around 8 years. So yeah, you were doomed to fail because your expectations were laughable.
The properties that do well are the ones that are updated... big surprise. As a frequent user I am occasionally shocked at owners who think buyers will put up with old outdated properties and furnishings
It's a scam. I hope it's gone for good. If you cancel they keep your money, lets keep the hotel in business, and they are more friendly business models.
@@EmpoweredHomeowner My brokerage account balance is almost $2M. I decided against buying rentals because of the stress, aggravation, taxes, insurance, HOA, liabilities, terrible renters, A/C needs repair, leaks in roof, etc... I make money clicking a mouse. 💰
those cleaning fees yet asks you to clean the place before you leave, load sheets/towels to washer before you leave, throw garbage before you leave... what is the cleaning fee for?
The only thing we ask is for guests to take the garbage to the dump, that's it. If you rent and use a home, then you pay a cleaning fee, plain and simple.
@@EmpoweredHomeowner and that is why I go back to hotels now... at least, they don't ask me to bring their "garbage to the dump" as you say.. i can even leave towels on the floor and leave without making the bed..
@@EmpoweredHomeowner IN my experience REITS have performed poorly in comparison to the rest of my stocks. Im also a landlord and a STR host. Seriously thinking to move to a boring business and more stocks.
@EmpoweredHomeowner the game has changed. Build and sell to a family. That's the only honorable thing left to do from what I'm seeing. The hedge funds are the monsters
@ I mean that the HOA’s bills you are paying, are equal or similar to the amount someone pay when renting a house. Besides the home ‘s taxes, morgate , etc. That is why many people are opting for renting instead buying a home.
That HOA fee is quite reasonable. Look at what owning an apartment in NYC costs, for example, beyond the mortgage. Their HOAs are in the thousands - A MONTH.
My Airbnb is doing great! I spent lot of time to manage it, style and deliver the best service, but wow! We are rock 🎸 & rolling and we are morning the touristy- area at all!
You closed on 02-Sep-2021 for $349K and it’s listed 40 months later for $435K. Let’s say your closing costs and realtor costs to sell (know you’re a realtor) amount to 10% of initial sale. You invested $10K after purchase (high estimate). And you put 10% down. If you get asking price, your net profit would be $38K on an initial investment of around $50K. That’s about a 23% annualized return
Your summary of perceived costs is not reality ($10k over 3 years sounds absurdly lowball number for a $400k property). Did you include property taxes, insurance, maintenance, storm damage repairs.... and you conveniently assume no major appliance or water heater ever breaks. I would put the figure closer to $25k minimum.
So true for most prop managers. I got lucky and mine is the cleaner and manager, only charges me 250/month to manager and she's a dream. It works out for both of us. I couldn't afford to pay what the others charge.
Well, huh; 38 year Realtor in the Pocono’s. Wait, did I say 38 years; we’ ve been doing Short Term Vacation Rentals for that long. Yes, it is a bit of a roller coaster ride, not for the faint of heart. But I have 38 years of happy homeowners who have enjoyed the process as much as the income. It is Investing, it takes effort, fore thought and elbow grease! Nothing worth having is easy. For our friend here, FYI the stock market is a full time job as well. Happy investing whatever your passion, walk your own road. There is an adventure to be had in the Pocono’s. He has ignored the fun of a purchase, the remodel experience, and what a great time he had in the Pocono’s; plus the money he has and will make.
@@julieheiney2520 Doesn't matter how long you've been a realtor, constantly repeating that means absolutely nothing. You didn't understand anything I was saying in the video either. Listen again.
Everyone got into Airbnb thinking it was fast money. Unfortunately you found this out the hard way. I’ve been a landlord for over 30 years only. I never had any interest in doing Airbnb. It’s too much work for too small a profit margin.
85% of new businesses go bankrupt within the first two years. Why should someone with no experience in the hotel business who jumps into the hotel business act surprised when it doesn't work out?
Nothing is easy. There is a reason why only 10% percent of the population is earning a higher income than the rest. Because hard work is not for everyone. Regardless of occupation to be good at something requires dedication hard work and determination. There is if you do --- then you will make money easily.
Nothing strange about this. I said exactly what I'm talking about. I did this for 3+ years and am now getting out of it because it's for me anymore. What don't you get about that?
@@EmpoweredHomeowner Well, for one thing you were complaining about the work. Why would you think this just falls into your lap? I have a professional management company that does EVERYTHING - but it costs quite a bit, as expected. Do you stay in your STR for your own enjoyment? We use ours that way and it works out great. Your STR doesn't seem to have anything around it like lakeside or streamside location. I would look for that in a "mountain vacation rental".
Sounds like you didn’t do your homework! Glad you realized this isn’t in your wheel house and getting out of this business. PS don’t like the HOA rules? RUN FOR THE BOARD! The owners vote for the board, so you can gather a group of supporters. And things that are written in the governing documents CANNOT be changed “just like that.” There is a formal legal process, and voting for approval.
I hear you on a lot of this, but the sympathy runs short when your 1-night fee is listed at $325 and yet for a 1 night booking I'd be paying $750 after your cleaning fees. Today's consumers are way more price savvy and will opt for hotels or cheaper options than be up-charged to that degree.
Never in a million years would I ask for your sympathy
LOL those are bargain prices?
all these extra fees suck and killed it
@@EmpoweredHomeowner It appears that way when your reasons for selling are “things are too tough” and “HOA’s suck.” Like yes im sure it does suck but so does a cleaning fee thats the same price as your nightly rate lol
@@DavidSeymourOfficial No it doesn't. I could care less what you think, I'm just telling my experience. I don't need sympathy
Good luck to you. One of the happiest days of my life was when we sold our rental property. FREEDOM! Now the money is invested in income producing securities that require zero work or maintenance.
Love to hear this!
And then the property collapses with no diversity now
THIS is what happens when you don't do your homework before deciding to build a STR business .. Running a Airbnb business is NOT a real estate business !!!! It's a HOSPITALITY business . When will people learn this ??
WELL, it is not like it is common knowledge. VERY few people even talk about this. The Gurus mainly talk about how "easy" it is and blah, blah, blah. You don't get this kind of knowledge until you actually do it, just like ANY OTHER BUSINESS!
It's half and half. If you buy in a great location and hire a manager, you got it made.
Only if the manager is good. Most aren't.
Great point. Save your money and buy rental properties.
Too many idiots listened to one person on bigger pockets , claimed he/him or whatever made millions & retired from a $500k job or some other nonsense story !!
I appreciate the honesty. Most real estate agents only paint the positives and down play the cons.
@@petecruz6637 Thanks for watching! I've built my business on honesty and being truthful. It's the only way to do business ethically in my opinion
I was a 10-year Airbnb host in NYC and had a very successful venture with little to no complaints. I was near JFK Airport with a multi-family property where I rented 6 rooms individually and had so many requests for stays I had to turn down money! My situation was unique. I work for myself and reside at the property so I could dedicate full time to running it. I had all amenities near me and was minutes away from the airport. I set my price below the rate of all other area Airbnbs in addition to the hotels, plus offered free snacks and refreshments. I even used my car as a shuttle service, with prices lower than Uber. I updated my property with the money I earned over the years and slowly raised my Airbnb rate.. I offered great service and got stellar reviews and attracted guests from all over the world. I self selected guests and chose only those with 4.5 stars or higher with good reviews, especially if they were a serial Airbnb renter. I quit Airbnb once the City changed the short term rental laws and now just have a regular tenant. I'd say location, and offering unique services in an attractive property are key to being successful.
@@uncleruckus7409 Spot on!!
what a loss that travellers no longer can stay with you. The city is a joke and tramples on property rights. Thanks for putting your passion into your property for the short time it was possible.
@@geoffl Thank you!. Yeah I made incredibly great money, far more than what the rental market would call for, far more than I ever imagined my property could produce. Plus I can't say how much the money helped me with my finances and managing the property. They City definitely needs to reexamine its housing laws. Far too many people just trying to make a living and do the right thing are losing out.
You could see the Airbnb bubble a mile away (and by a mile, I mean like 3 years). With that said, people having the self-awareness to take your losses and walk away is in short supply these days; you deserve credit for not just acknowledging the situation but sharing it so others don't get trap in ego or delusion. I don't think you'll regret moving forward to something that'll better align with your goals.
Thanks! Hopefully this helps others make a wise decision.
As an Airbnb super host, I must say this was the single funniest video I have ever seen on this subject. I particularly loved the section on "updating." My "updated" bathrooms are privies with five-gallon buckets. I won't even talk about the kitchen.
I'm a super host as well! That's awesome 🎉
I'm in east central FL. I had 3 AirBnBs. They were in an RV resort, near I-95. (My town doesn't allow STR in houses, only condos or in-law suites, while owners living in main house). So, only other idea was the park models in RV resort. Did great in winter. Ok in summer. But, August-Nov was really tough. Had to rent on month to month basis to break even, and those were the guests that trashed the places. I also was competing with the motels. I had to come in at same price, including cleaning, taxes, vrbo fees, 3% ccard fee, etc. I had to self manage & clean. Sold them in 2019-2020.
It was very hard work.
My suggestion, if looking at STRs as a business- run the numbers & compare with hotel rooms+all the xtras.
Solid advice!
This is good advice.
I totally agree with you. I have a short-term rental in Houston and it's hard to turn a profit unless you self-manage which is a full-time job. You definitely have to update your kitchen and bathrooms in order to be competitive. Then don't think you about to charge some crazy one-night stay or cleaning fee because you will not get booked because someone else is way cheaper than you for the same accommodations.
Well said and spot on!
The map views of all the SRT's in San Fransisco and Orlando are astonishing.. It's almost like entire neighborhoods are all STR's... okay not really but the saturation is extremely real... that is a ton of competition as the economy slides. Once we are in recession it'll be race to to the bottom as all the STR investors fight over limited bookings.
@@jonathantaylor6926 We're already in a race to the bottom.
@@jonathantaylor6926 it's already like that in Italy 😅
I thought you just lost your second house and make money?
STRs are a full fledged business. Its no longer a real estate play. If your business isn't right, the unprecedented real estate appreciation is no longer going to bail you out.
Yes they are
I own 2 houses near that area. One in an HOA one not in an HOA. Long term rentals in that area are in big demand. And the property tax in an HOA is less than outside an HOA, so it almost evens out with the dues plus taxes in an HOA and just taxes outside an HOA.
Cool!
Hands down the best video I've seen this year. Because like most I've been thinking about having a property so I can do airbnb on the side but I have a full time demanding job like most. Gives me something to think about
I'm so happy you found value from this!
I started watching you 2 yrs ago when you were just starting the channel. We also live in Chesco and had just spent a great weekend in the Poconos. We loved it so much we started looking at buying a place there. I kept watching your channel and kept monitoring listings up there, but we could never make the numbers make sense. Every reason you listed were things we noticed and it just didnt seem like we could make it cash flow like we do with our ling term rentals. Interesting to see that you've come to the same conclusion.
@@jayhoggard92 Thanks for following along! Yeah it's not what it used to be. I do believe can be successful and make a property cash flow, it just depends on how you buy it. If you're financing with 10 to 20% down it will be more difficult. To me it all comes down to how nice you can make the property. If you have a good amount of cash up front I can really dazzle it out, you will cash flow
Had a rough year on our FL spot due to large assessments, around $25k. This year seems better but I think a lot of people quit because of oversupply. For Airbnb, I think two basic approaches would work. One is running a big consistent business with staff, the other is you just want to have a place in a location and use Airbnb so you can bring down the cost of ownership.
Dam man, that a crazy high assessment! And I couldn't agree more with the business and staff and just having it cover costs so your family can enjoy 🥰
Were the total fees on a monthly basis?
Yearly
important to hear about the downsides, thanks for sharing
Thanks for watching!
Property managers are terrible. Yes it’s a sweeping generalization but I’ve used 4 different ones in Los Angeles. They charge a lot and don’t manage well especially when you need a plumber and you’re always dealing with plumbing problems in a rental . People are ignorant about the basics . Wipes down the toilet, 1/2 roll tp every time someone uses the bathroom.
Just like anything, it's the 80/20 rule
I live in PA and personally I wouldn’t rent a home that wasn’t renovated. My home is completely renovated. If I am renting a home why wouldn’t I expect the same. The fees are too high not to be. I live in Bucks county there is no supply of home here. Only 2 on the market in my neighborhood 1 for $1.8 million and the other for $2.5 million.
@@QuantumKitty cool
I had to stop doing Airbnb too
@@yakuzaboss1988 what happened?
Link to your Airbnb listing?
airbnb.com/h/thekeatsretreat
Do u have long term rentals? Also do u think its better to invest in long term vs short?
Yes, I do. I think both strategies are good and can work, it just depends on you as an individual. Short term is significantly more hands on, where as long term is way less time and effort. Both have pros and cons. I did make a video about this - th-cam.com/video/bersjsd_snY/w-d-xo.html
Yep was happy to get out of 2 airbnbs in 2023, wanted my freedom back!
Glad it worked out for you!
I have an AIRbnb in one of my units in a 4 unit building and it’s doing great. My mortgage payment isn’t fully dependent on my airbnb income, that’s more of a cushion. I think anyone who buys a house solely to airbnb isn’t wise
Sucks what happened to you!
Yep been there done that here ins massachusetts I saw the writing on the walls very early. However, I love real estate, and now I just do long-term rentals. There is no headache and no reviews to worry about all the time.
@@bostonnews1776 You're speaking my language. My long term rentals are mostly non-headaches
You should do direct bookings. It’s a bit of work at the beginning but it’s worth it.
@@basselabedi we do direct bookings. Not enough to sustain. It's almost impossible without using Airbnb.
Well, I hope you will be able to sell your property with some profit or minimum lost.
I appreciate this! Thank you.
Damn, i wont complain again about the fees here in stillwater 😂. I didnt know better and was happy to get my kids away, but next one will not be in an hoa😂
@@mancavemotorsports hahah. Good thing it's only a special assessment though, so not every year.
What I don’t like about Airbnbs is that they charge exorbitant cleaning fees. But, do they actually clean? No! Every Airbnb I’ve stayed at was only surfaces cleaned. But guess what, they charge $400-$500 to all their guests. It’s a scam. Let’s not forget the fact that you have to clean and do laundry and dishes before you leave. Always something broken or over-used. Note: none of the places I stayed at were inexpensive by any means. Rather stay at a hotel.
I agree.
Simple solution: Don't stay at an Airbnb!
Thanks for the honest content. I wonder what the next few years will bring. I imagine that there will be a significant amount of Airbnbs that sell in the near future, leaving less competition for the remaining Airbnbs. How will a sell off impact house values in the next few years? Do you see it as an end to low risk, profitable Airbnbs? or a cycle where it will be favorable for Airbnb hosts again?
@@jamesstott2378 great questions! I think if you can hang on now while the "Great Sell Off" happens, you'll be in a good position in the next few years. You just have to have the cash in order to get through it. I believe a large portion of hosts now will be gone in the next 3-5 years bringing more balance to hosts and those properties that are designed well, will do well! Could actually even be a good time to buy if you can weather the storm
there are business cycles. Covid created a lot of hype and people piled in. If you can survive through this correction and even expand a bit, you will be reward again when the supply/demand situation evens out. The key is not selling at the low.
Yes sir! For those who can weather the storm, you will be happ you did so!
I've been managing our two Airbnbs in Port Saint Lucie and Vero Beach for almost 2 years and I've had really good results. I can see it as something scalable and a really good business, when you automate the business it doesn't take a lot of time. I still have plenty of time for my family and my demanding full-time job. From your video, I could gather a few key mistakes starting out on the business: always avoid HOAs specially for STR purposes, not having amenities, not having a competitive/renovated listing, hiring a professional photographer and ideally a pro interior designer, being in a desirable location. That's been my experience, though. I appreciate the transparency.
Florida is VERY different from the Poconos. It is also VERY difficult to avoid HOAs in the Poconos because the majority of producing properties are located there. The location is also very desirable, but the main issues is how much competition has increased over the past 2 years.
I think it can all be about perspective. If I got into the STR business it’s to have other people help me build equity. If my mortgage is $1,500 and after AIRBNB it comes down to $300-$400, I consider that winning.
That's a good way to look at it. Also you can write off just about everything which really helps on the profit and loss tabulation. I re-investment a big chunck of the "profits" to increase value and for our enjoyment when we use our STR ourselves.
Life is always about perspective 😎
Right, I own a large home on a lot of land in a college town. I don’t have any debt but I am going to rent it out to at minimum offset taxes, insurance and maintenance. Anything over that will be a bonus. Hopefully build myself a much smaller house on the property.
@JABINVA Great idea!!
I hear what you’re saying about the homes needing to be updated. The way I see it is it’s almost like renting an experience for a weekend. Tough business I’m sure. The Poconos are great. It’s like upstate also (Hunter/windom). I feel like the price are cyclical. Interesting video. Thanks for sharing your experience
It is definitely a tough business.
My friend bought her house and said she will do that as recommended by realtor. Didn't work out.
Okay
New subscriber here! Why do youtube? Still a time-eating machine. No hate, just asking
Thanks for subscribing! TH-cam is the main way to generate business and it is the BEST!
While HOA's do frequently suck, they are sometimes very good ideas and are very reasonably priced. I have a relative, for example, who pays $170 per year, nothing more, for the HOA fee on her $600,000 house and her neighborhood is kept in very nice condition...almost entirely because of the requirements/standards of the HOA. She lives in a development where, if the HOA didn't exist, the complex would be a total mess. With that said, I would never live in an area with an HOA because I hate having restrictions, many of which are often far too strict.
good for some, not for all
People dumping STRs en masse is going to happen. Most of these rentals are used for vacation and business travel to some extent and both forms of that travel get decimated in a recession. The STR market is unbelievably oversaturated in places like Orlando and San Fransisco. Sooner or later the economy will find itself in a recession and there will be nowhere near enough demand to support the level of STR's that currently exist. It'll be a race to the bottom with way too many STR's competing for nowhere near enough demand. The entire business is going to shift from highly profitable to only covering a percentage of the mortgage. When you run an AirBnB you are selling time, and the clock always ticks.
You make a really good point. I've been hearing from a lot of hosts that this will happen and I believe the "Great Airbnb Sell Off" will be happening soon
I bought 2 in 2016, 3 in 2018, and 1 in 2021 and put down 20-50% so my notes are relatively low for what I have. Hopefully I can wither the storm and hold on to mine. The people that spent 500k to make 800/month will be in big trouble.
All HOAs in single family communities should be disbanded. They're not necessary.
Neighborhoods have been around for decades if not centuries & the communities are desirable.
@@dhowto3005 that would be nice!
What makes you think that stock market is not in its peak?
I never said it was or wasn't....
“Remember that time when people with no business experience thought they could run small hotels? Good times.”
@@dandrake337 Remember that time when people who commented on a random person's video with absolutely not experience tried acting like they knew what they were talking about about? Good times.
Today, its competitive. You have to stand out and offer amentities.
Also, I'm looking to buy in that area.. hit me up
Yes!
better to be in the first couple waves of airbnbust sellers. once it gets ugly it will be a true race to the bottom
I couldn't agree more! I will be coming out with a video about the "Great Airbnb Selloff" in 2 weeks!
Airbnb charges way too much and double dips from the owner as well. The tourist taxes on top of Airbnb fees ads 25% more to the cost of a night. Hotels are a much better choice and no surprises and cheaper.
@@b4804514 Airbnb fees are ridiculous
That’s why it’s considered active income
Yup
I find it hilarious when you talked about the return on the investment needed to update it. “Is it going to take one year, two years…?”
Major hospitality chains ROI timeframe is typically around 5 year for recoupment and reinvestment/renovation again around 8 years.
So yeah, you were doomed to fail because your expectations were laughable.
Good insight! You should teach a class on this
Location location location the Poconos isn’t it.
It is still it and people are successful there
thanks for sharing
Absolutely and thanks for watching!
Business has slowed quite a bit. Folks just jump on a plane and leave the country. Hopefully things improve this coming season!
We'll see!
Smart decision!
I hope so!
Great! One more home for a local family.
Not many locals buying here.
I hereby absolve you from your sins. Now go forth and may you find the greater fool with $435,000 cash!
Thanks, I needed this 🤣🤣🤣
I get you. HOA sucks!
@@winecellar1012 Yes they do!!
Happy Airbnb will disappear soon
@@joseeduardobtesh1651 doubtful
@@EmpoweredHomeowner it will. They ruined housing availability in the world except Sweden who opposed it. Best regards 😺
@joseeduardobtesh1651 it won't though. Definitely has t ruined housing availability in the world. There are many more factors contributing to that.
Oh yeah it will. People are not vacationing and pulling back. Just wait
Thats fair. Have a good day.
@@Oban2006 uhh, thanks I guess.
The properties that do well are the ones that are updated... big surprise. As a frequent user I am occasionally shocked at owners who think buyers will put up with old outdated properties and furnishings
Yup
It's a scam. I hope it's gone for good. If you cancel they keep your money, lets keep the hotel in business, and they are more friendly business models.
It's not a scam. Do hotels just allow you to cancel at last minute? Some do and some don't... just like airbnb.
It's definitely NOT a scam. Hotels are okay for some, but not for most. Want to rent a place with a kitchen where they can cook.
@@EmpoweredHomeowner My brokerage account balance is almost $2M.
I decided against buying rentals because of the stress, aggravation, taxes, insurance, HOA, liabilities, terrible renters, A/C needs repair, leaks in roof, etc...
I make money clicking a mouse.
💰
There are plenty of hotels that have small kitchens with dishes and utensils and pots.
@ That's a suite and it's $1000/night. I'll take a front yard, back yard, garage, big kitchen, etc.
those cleaning fees yet asks you to clean the place before you leave, load sheets/towels to washer before you leave, throw garbage before you leave... what is the cleaning fee for?
The only thing we ask is for guests to take the garbage to the dump, that's it. If you rent and use a home, then you pay a cleaning fee, plain and simple.
@@EmpoweredHomeowner and that is why I go back to hotels now... at least, they don't ask me to bring their "garbage to the dump" as you say.. i can even leave towels on the floor and leave without making the bed..
@nael2770 Good for you. You get a gold star!
Everything you said is common sense. Second your major mistake was to have one in an HOA
@@gabrielalvarado1504 Almost all of them are in HOAs in the Poconos, very hard to avoid
Buy REITS
That is something I am looking into!
@@EmpoweredHomeowner IN my experience REITS have performed poorly in comparison to the rest of my stocks. Im also a landlord and a STR host. Seriously thinking to move to a boring business and more stocks.
@@beautyandplay From my research, it seems like index funds are a good option. I will never get out of real estate investing though!
Good idea.
@@MizZzChAvVvOzZz yeah, I'm glad you agree.
@EmpoweredHomeowner the game has changed. Build and sell to a family. That's the only honorable thing left to do from what I'm seeing. The hedge funds are the monsters
@@MizZzChAvVvOzZz I've never experienced hedge funds in this area
@@EmpoweredHomeowner they're comin brother. They're comin for everything
😎
You are renting your own house, with this high HOA.
@@charmingbeautytv4712 what do you mean?
@ I mean that the HOA’s bills you are paying, are equal or similar to the amount someone pay when renting a house. Besides the home ‘s taxes, morgate , etc. That is why many people are opting for renting instead buying a home.
@charmingbeautytv4712 my HOA is $400/year normally without the special assessments
That HOA fee is quite reasonable. Look at what owning an apartment in NYC costs, for example, beyond the mortgage. Their HOAs are in the thousands - A MONTH.
@@dzerressame in nice buildings in so florida. Crazy.
My Airbnb is doing great! I spent lot of time to manage it, style and deliver the best service, but wow! We are rock 🎸 & rolling and we are morning the touristy- area at all!
cool
You closed on 02-Sep-2021 for $349K and it’s listed 40 months later for $435K. Let’s say your closing costs and realtor costs to sell (know you’re a realtor) amount to 10% of initial sale. You invested $10K after purchase (high estimate). And you put 10% down.
If you get asking price, your net profit would be $38K on an initial investment of around $50K. That’s about a 23% annualized return
@@scottsnyder2726 we invested a lot more than 10k
It looks like a great home. I hope you get a good price. I spent hundreds of weekends in the Poconos, and still own land there.
Your summary of perceived costs is not reality ($10k over 3 years sounds absurdly lowball number for a $400k property). Did you include property taxes, insurance, maintenance, storm damage repairs.... and you conveniently assume no major appliance or water heater ever breaks. I would put the figure closer to $25k minimum.
AirBNB sucks
@@purplehayes33 yeah, it kind of does!
Airbnb sucks, the property manager is making all the money...
@@biskit7 They don't really make that much because of overhead
So true for most prop managers. I got lucky and mine is the cleaner and manager, only charges me 250/month to manager and she's a dream. It works out for both of us. I couldn't afford to pay what the others charge.
I agree 100% HOA suck.
Well, huh; 38 year Realtor in the Pocono’s. Wait, did I say 38 years; we’ ve been doing Short Term Vacation Rentals for that long. Yes, it is a bit of a roller coaster ride, not for the faint of heart. But I have 38 years of happy homeowners who have enjoyed the process as much as the income. It is Investing, it takes effort, fore thought and elbow grease! Nothing worth having is easy. For our friend here, FYI the stock market is a full time job as well. Happy investing whatever your passion, walk your own road. There is an adventure to be had in the Pocono’s. He has ignored the fun of a purchase, the remodel experience, and what a great time he had in the Pocono’s; plus the money he has and will make.
@@julieheiney2520 Doesn't matter how long you've been a realtor, constantly repeating that means absolutely nothing. You didn't understand anything I was saying in the video either. Listen again.
Everyone got into Airbnb thinking it was fast money. Unfortunately you found this out the hard way. I’ve been a landlord for over 30 years only. I never had any interest in doing Airbnb. It’s too much work for too small a profit margin.
@@maryannrogers8675 wow, you're so special!
Last place we stayed at airbnb was a dump with all kinds of rules. We will never us airbnb again.
Good for you!
Real estate is illiquid with tons of transaction costs and maintenance expense. It is not a good asset to own.
I couldn't disagree more. They are FANTASTIC assets to own to build wealth. Not for everyone though.
85% of new businesses go bankrupt within the first two years. Why should someone with no experience in the hotel business who jumps into the hotel business act surprised when it doesn't work out?
@@fullclipaudio who is surprised?
@ You.
Nothing is easy.
There is a reason why only 10% percent of the population is earning a higher income than the rest. Because hard work is not for everyone.
Regardless of occupation to be good at something requires dedication hard work and determination.
There is if you do --- then you will make money easily.
Cool man!
Strange. Business is a business. What are you talking about? It's not a passive income. You have to work every day on it
Nothing strange about this. I said exactly what I'm talking about. I did this for 3+ years and am now getting out of it because it's for me anymore. What don't you get about that?
@@EmpoweredHomeowner Well, for one thing you were complaining about the work. Why would you think this just falls into your lap? I have a professional management company that does EVERYTHING - but it costs quite a bit, as expected. Do you stay in your STR for your own enjoyment? We use ours that way and it works out great. Your STR doesn't seem to have anything around it like lakeside or streamside location. I would look for that in a "mountain vacation rental".
Sounds like you didn’t do your homework! Glad you realized this isn’t in your wheel house and getting out of this business. PS don’t like the HOA rules? RUN FOR THE BOARD! The owners vote for the board, so you can gather a group of supporters. And things that are written in the governing documents CANNOT be changed “just like that.” There is a formal legal process, and voting for approval.
Sounds like you dont know what you're talking about about, Grammy. Stick to what you know.
Greedy investor.
Oh yeah, greedy investor trying to build wealth for his family and create a legacy for his kids. SOOOO greedy. Do better
Blah blah blah…
Oh wow, really original. Where'd you come up with this?!?
YOU TAPPED OUT
QUITTER !!!
Could be worse and be an internet troll. Nothing worse than that!