Work isn't a four letter word often associated with short term rental properties or vacation rental homes but probably should be. 

I reckon in the past four years, I've covered as complete spectrum of vacation rental property ownership, sales and management as just about anyone on this site or beyond..allow me to digress..

My STR story isn't exceptional or abnormal but for those considering venturing into the 'BNB' world, my experience is highly relevant to this unique, lucrative and challenging asset class.

The PROS: What you've read on Bigger Pockets and watched on IG reels is that owning an AirBNB can be highly profitable. This is true. Here on the Oregon Coast (by no means conventional) the gross revenue produced from a permittable nightly vacation rental on the Oregon Coast should be roughly 10% of the value (at the time of this writing.) 

So for example a $1M 4/3 home with an ocean view and beach access should average someone in the $100k+/- gross annual revenue range. 

I know, it sounds too good to be true, but this is a hard average from roughly 250+ Pro Forma analysis' and revenue reviews of coastal vacation rentals on the Oregon Coast from Brookings to Astoria from 2018-Present. 

The opportunity was so apparent that I dropped everything in late 2018, purchased my first Oregon Coast vacation rental home and spent the next two years completely remodeling a 800SF house from the ground up. I was under experienced, under capitalized, and under prepared for the demands of construction, furnishing and preparing a home for rental. 

My favorite areas are always the most isolated. The Oregon Coast is rugged, remote and rural. The nearest Home Depot, Costco or airport was about 3 hours away. Logistics is something I, or most people from metropolitan areas might not fully appreciate..especially in the age of Amazon. Getting people, things, appliances and furniture to and through the door is much easier on Pinterest than in the real world. And it doesn't get much realer than 25 degrees, rainy, without insulation, running hot water while waiting on windows. Did I mention I had no idea what I was doing?

Fast forward five years..I and my team (uh...fiancé) have purchased, upgraded, furnished, rented and sold three vacation rental homes on the Oregon Coast, flipped one parcel of semi developed land and recently completed a free and clear ocean view nightly vacation rental in north Baja Mexico. 

It has been a worthwhile adventure. We have made plenty of mistakes. Mostly with unexpected demands on time, costs, and energy required to turn four walls into a full time vacation rental HOME. 

There is a REAL difference between a rental and a nightly vacation rental home, primarily in the form of the tender love, care and attention needed to establish and maintain what is essentially a mom and pop hotel business. 

We've all stayed at AirBnB's and hotels that just weren't that 'nice.' Especially nowadays...it seems like everywhere we turn, we are constantly disappointed in the value of product or service provided..or is it just that I have impossibly high standards? Maybe...but maybe we all just want what we pay for. The average AirBnB now costs somewhere around $300?! That is $9,000 per month if operated at 100% capacity. To earn that type of income, should and does take a lot of effort. 

Accommodating a tenant, full time, with utilities, water, power, electric, internet, linens, towels, pots, pans, electronics and a clean, safe, functional space is hard enough to do for oneself, let alone for others, often hours or many states away. 

Not coincidentally some of the most desirable and profitable vacation rental areas are either some of the more valuable or difficult areas to reach. 

Supposedly the most profitable AirBNB in the country is a small A Frame cabin in the woods. It's a nice setting, it's not as nice to think about purchasing a vacant property, that isn't your primary residence and preparing it as a full time residence, but not the one that you'll be living in full time. 

Just moving is a lot. Upgrading, furnishing, decorating, marketing, cleaning, managing and maintaining a 300 night per year business is a also demanding. All businesses are more fun and profitable on paper than in the real world. Likewise fully operating a vacation rental property in the mountains, or an island remotely is more enjoyable on paper and forums than in actuality. 

This is not a negative. It is however a wake up call. The Las Vegas kind, the call you really don't want at 10AM after a looong night but the kind that makes sure you make your flight. 

Nightly vacation rentals are hard work. They are honest work, that can reward the effort, but it's not the vacation your occupants are hoping for.

The behind the scenes of a well executed experience, event or hosting are involved. Some of the key areas to consider beyond vacation rental permit eligibility, price, timing and financials are the intangibles such as:

- Interior Design

- Furniture and furnishings

- Vacation Rental Permit Application, process and proceedure

- Maintenance 

- Management

- Emergency support

Closing on a property is chapter one but it's the rest of the story that determines your success or failure as a vacation rental home operator/owner. 

There are many varieties of vacation rentals, but all in all, there are four walls. 

To take a property from a house to a home takes something special.. it takes tender, love, and care. Put two identical properties next to each other and available for rent on AirBNB and one will outperform the other. 

Why?

Details. The owners of the more productive vacation rental tried and cared more. That's it. Don't believe me? When you stay at a home or hotel what is it that makes you say; 'This is REALLY nice!' 

It's the 'little things.' It used to be cookies and the host's recipe, now it's just the cleanliness and how comfortable the host made it feel like home. The top producing vacation rentals are not stale or basic. They don't feel staged, or filled with IKEA furniture. 

No offense, but hotels don't use Ikea furniture, because it's not practical or comfortable. 

It doesn't look good, last and generally isn't a great investment. 

You wouldn't furnish your entire home from IKEA, why offer it to others? I mean you can, but customers can tell when they're getting more for their money or less. And so can you. Investing isn't so much about price, but it is about value. 

If investors are willing or able to make the significant commitment to a mortgage, they need to be willing to commit to the true cost and responsibility of providing a full time home for others. 

Investors can be frugal, but not cheap. Good furniture and good hosts are not cheap and cheap furniture and cheap hosts are not good. 

That's just the way the world works. You will always get what you give. Give visitors a great experience and the property will produce great results. 

Do the bare minimum and I can pretty well project your results..

On the other hand if you go above and beyond, anticipate positive metrics over the long haul. On that note, these are long term investments with long term timelines. As with opening a new hotel it can and will take time to establish traction and a consistent customer base. 

Yes, you will have instantaneous success (at least on the Oregon Coast) but you will also have unanticipated interruptions to operations and life. 

The most successful real estate investors, own their properties for a long time and take good care of their assets. 

Privately operated vacation rental properties are a newer asset with a long history of performing well when well cared for. 

Some notes that have helped our shared spaces stay in occupied: 

- Thrifts and estate sales are an excellent source to save on super high quality furniture that will impress and not need to be replaced. You would be amazed at how inexpensively you can furnish a space. 

- Logistics are something to consider when purchasing a short term vacation rental. Upgrades, movers and getting mattresses to and from hard to reach places can be well..hard. 

- Linens are the primary cleaning challenge when there is a short turnover window. For larger rentals it's essential to outsource the linens to a local laundry mat or wash and fold. The cleaners time on site will be cut by half and it will save you at least a washer or dryer per year if you have over 3+ bedrooms. 

- Block off some personal time at the property. All investors have different goals and intentions for their portfolio. One nice element about a vacation rental is that it can actually be utilized by the owner, as opposed to many asset classes that would not, or cannot..Staying at a vacation rental from time to time is a great way to gain insight into guest(s) experience. A host that is consistently assessing and improving their accommodations is likely to consistently have demand for them. 

Cheers.