Airbnb Property Management, Louisville, KY

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Airbnb Property Management, Louisville, KY

Dan Close
Rental Property Investor · Louisville, KY · Member since 2012 · 51 posts · 31 votes

Hi, I wanted to ask a question of the community. 

I have been thinking about starting an Airbnb Property Management company in Louisville, KY. I'm a licensed real estate agent, and a long time 5 star Airbnb owner with Superhost status. I know that Airbnb requires a much higher involvement then a normal rental and can be tough for people with other business activities or full time jobs.  My thought is we would handle all logistics including booking, hospitality, cleaning and etc.  

So my question for the group is, do you see a need in this niche? 

Thanks for any feedback,

Dan Close

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Justin H.
Rental Property Investor · Louisville, KY · Member since 2013 · 32 posts · 16 votes
8y

Hey Dan, 

I definitely think there would be interest for that type of service in Louisville, KY. I've been curious about converting one of my SFRs or a unit in a multifamily into a STR and seeing how it does and if I did so I would definitely hire an AirBnB focused property manager because I wouldn't want to deal with the logistics of check ins, cleaning, etc.

There are 2 companies that I'm aware of that are currently offering exactly this type of service: Key Source Properties and BnB Louisville.  Here's a recent Insider Louisville article about Key Source which says they are now managing 30 AirBnB rentals.

Do you currently do AirBnB with your primary residence or a different property?

Thanks,

Justin

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  • Carrie Penney
    Investor · Lubbock, TX · Member since 2017 · 26 posts · 12 votes
    8y
    Yep, definitely. We are thinking about doing it here too. There are sooo many people we talk to about AirBnB that have no clue what we're talking about. Instead of being excited about our income they seem overwhelmed by it, so I think there is definitely a market for this. I think you could do really well by advertising right and convincing people to convert from traditional rentals to an AirBnB model. Good luck! Let us know how it goes if you do it.
    1Reply
  • Tyler Work
    Rental Property Investor · Denver, CO · Member since 2017 · 179 posts · 208 votes
    8y

    Hey @Dan Close I do exactly what you're talking about here in Denver and it is definitely a niche.  Lots of work, yes, but I manage to run a small business while keeping my full time job.  Being a licensed broker helps because if the short term game goes sour with any of your clients due to neighbor complaints, regulation, etc, you can keep their business and manage their properties long term.  In Colorado, you do not need a broker license for STRs but do for traditional property management.  

    There are also several large firms who do this whom you can learn from.  Check out Evolve, Vacasa, and Stay Alfred and see what they offer to give you a starting point. 

    Best,

    Tyler  

    1Reply
  • Dan Close
    OP
    Rental Property Investor · Louisville, KY · Member since 2012 · 51 posts · 31 votes
    8y

    @Carrie Penney Thanks I will keep you updated for sure. I have heard of people actually renting the properties themselves from the landlord and with their permission turning them into Airbnb's. Work would be the same as managing it for someone else but you would keep the full difference between the monthly rent you paid and the Airbnb profits. Bit more risk as you have to foot the whole cost to furnish it.

    1Reply
  • Dan Close
    OP
    Rental Property Investor · Louisville, KY · Member since 2012 · 51 posts · 31 votes
    8y

    @Tyler Work That's awesome. Any plans to go take your small business full time in the future? I imagine Denver has a very hot Airbnb and Corp short term rental market.  Thanks for the competitor info, i'll check them out

    1Reply
  • Tyler Work
    Rental Property Investor · Denver, CO · Member since 2017 · 179 posts · 208 votes
    8y

    @Dan Close That's the goal.  I think one person could conceivably handle 10-20 properties on the side before it becomes a full time job, and yes Denver has been great so far.

    2Reply
  • Justin H.
    Rental Property Investor · Louisville, KY · Member since 2013 · 32 posts · 16 votes
    8y

    Hey Dan, 

    I definitely think there would be interest for that type of service in Louisville, KY. I've been curious about converting one of my SFRs or a unit in a multifamily into a STR and seeing how it does and if I did so I would definitely hire an AirBnB focused property manager because I wouldn't want to deal with the logistics of check ins, cleaning, etc.

    There are 2 companies that I'm aware of that are currently offering exactly this type of service: Key Source Properties and BnB Louisville.  Here's a recent Insider Louisville article about Key Source which says they are now managing 30 AirBnB rentals.

    Do you currently do AirBnB with your primary residence or a different property?

    Thanks,

    Justin

    2Reply
  • Dan Close
    OP
    Rental Property Investor · Louisville, KY · Member since 2012 · 51 posts · 31 votes
    8y

    @Justin H. Hey Justin sorry about the delay, I didn't get the alert for your post for some reason. Thanks for the info on the companies that are currently in existence.  Yes, I currently airbnb an investment property that I own and one for a client. Would be happy to discuss your properties with you, i'll send you a colleague request.

    0Reply
  • Sarah Brauner
    Austin, TX · Member since 2017 · 2 posts · 1 vote
    8y

    @Dan Close, did you ever end up starting the management company? I was considering buying a property in Louisville but would need some help.

    1Reply
  • Greg Smith
    Rental Property Investor · Louisville, KY · Member since 2017 · 58 posts · 34 votes
    8y

    I’d be interested in recommendations for Airbnb management in Louisville also.

    2Reply
  • Jay Leisten
    Real Estate Broker · Louisville, KY · Member since 2014 · 362 posts · 232 votes
    8y
    We are looking at starting a STR management company with licensed agents at the moment. My wife has 8 years of hotel management experience and access to cleaning crews, maintenance etc on Call. I’ve been focused on buy and hold rentals but am starting to get more interest from my investors towards the ABB model.
    0Reply
  • Dan Close
    OP
    Rental Property Investor · Louisville, KY · Member since 2012 · 51 posts · 31 votes
    8y

    Hey 

    @Sarah Braunerand @Greg Smith never officially started a company but I have been helping people out. I'll send you both a PM with my number and if nothing else I can at least share my thoughts and experiences for the Louisville Airbnb Market.

    1Reply
  • Rick Osborne
    Member since 2019 · 1 post · 0 votes
    7y

    I am interested in anyone who has the knowledge and expertise to manage short term rentals in Louisville.  I have properties and am interested in acquiring more for short term rentals, if there are competitive and competent options. 

    Anyone? 

    0Reply
  • Ken Latchers
    Hatfield, PA · Member since 2012 · 1k+ posts · 629 votes
    7y

    Please don't dig up old threads to spam with business offerings?

    0Reply
  • Jonathan Klunk
    Louisville, KY · Member since 2017 · 6 posts · 0 votes
    7y

    My apologies, Ken. I found my company name mentioned in a thread and wanted to introduce myself. It looks like the last comment was only 3 months ago. I wouldn't call that old;) Cheers!

    1Reply
  • Dan Close
    OP
    Rental Property Investor · Louisville, KY · Member since 2012 · 51 posts · 31 votes
    7y

    Been awhile since I wrote the original post, but I have received a few PM's asking me what I think about the Airbnb market now. Messaged those people back individually but also thought I would share my thoughts here. My Airbnb opinion has slight shifted, and I have turned my smaller units back into rentals. The primary example was a two-bedroom 800 SF unit in the highlands. Rent on that unit is around 1,000 per month. With Airbnb after factoring out unities and other costs it made about 15K for the year. When you consider the time investment for that additional 3k I decided it was not worth the effort.

    Where the Airbnb model really shines is with high end large homes where you can get $500 to $1000 per night. In Louisville you will get groups in town doing bourbon tours, lots of traveling high school sports teams, bachelor/bachelorette parties(some people don’t allow these due to high potential for damage), and etc. What makes this very profitable are a few factors

    -The competition is less for these homes because it’s a higher barrier to entry and it eliminates hotels if there is a large group that wants to stay together.

    -The effort as far as communication with the guests is the same but the profit is much higher

    -While the cleaning cost is higher on a large home that’s mostly passed through to the guest

    -After building the ratings on the property for a few months there is an opportunity to pay a very large portion of the mortgage for the year just from derby alone

    Love to hear what others from Louisville and different markets think as well. 

    Cheers,

    1Reply
  • Emily Fackler
    Rental Property Investor · Eddyville, KY · Member since 2019 · 33 posts · 19 votes
    7y

    @Dan Close I definitely do! I think one of the biggest reasons I don’t want to air bnb is because of the cleaning and scheduling.

    0Reply
  • Dan Close
    OP
    Rental Property Investor · Louisville, KY · Member since 2012 · 51 posts · 31 votes
    7y

    @emily fackler were you thinking about turning a rental into an Airbnb or buying a property specifically to Airbnb?

    0Reply
  • Meir Greenblatt
    Rental Property Investor · Houston TX / Tacoma WA. · Member since 2019 · 166 posts · 89 votes
    7y

    @Dan Close

    I think it's a great idea, I would have done the same if I wasn't to lazy :)

    I recommend connecting with a good property management company, and partner up so you manage the STR side of the business, and that is how you can share resources, (just my thoughts )

    0Reply
  • Chuck B.
    Investor · Louisville, KY · Member since 2011 · 279 posts · 248 votes
    7y

    @Dan Close - I have a large (3,950 sq foot, 7BR) old mansion located at 1190 East Broadway, impressive woodwork and details, just between the two new Edwards Communities developments and a couple of blocks up the street from the new Paristown Point development (KCA's new event venue). It's zoned OR3, so no conditional use permits required for short term rentals or a professional co-working space.  The most recent tenants (a behavioral therapy group) moved out last week for a larger location. I know it would be an amazing space for someone, but I'm only looking to lease, not sell. DM me if you'd like to discuss or have a showing.  

    Best,
    - Chuck 

    0Reply
  • Dan Close
    OP
    Rental Property Investor · Louisville, KY · Member since 2012 · 51 posts · 31 votes
    7y

    Sounds interesting, I'll shoot you a DM @Chuck B.

    Thanks,

    Dan

    0Reply
  • Dana McMahan
    Real Estate Consultant · Louisville, KY · Member since 2016 · 30 posts · 8 votes
    6y
    Originally posted by @Dan Close:



    Where the Airbnb model really shines is with high end large homes where you can get $500 to $1000 per night. In Louisville you will get groups in town doing bourbon tours, lots of traveling high school sports teams, bachelor/bachelorette parties(some people don’t allow these due to high potential for damage), and etc. What makes this very profitable are a few factors

    -The competition is less for these homes because it’s a higher barrier to entry and it eliminates hotels if there is a large group that wants to stay together.

    -The effort as far as communication with the guests is the same but the profit is much higher

    -While the cleaning cost is higher on a large home that’s mostly passed through to the guest

    -After building the ratings on the property for a few months there is an opportunity to pay a very large portion of the mortgage for the year just from derby alone

    Love to hear what others from Louisville and different markets think as well. 

    Cheers,

    This was interesting to me to read and I'd like to share my opposite experience. We live in a huge house in Old Louisville with several options for STRs: the third floor guest suite, the carriage house, or the 'main house' (two floors, sleeps 8).

    I quit doing the main house after Derby this year because I was seeing so much competition at rates a fraction of what I'd need to make it worth it. Before the market got so saturated I was able to get around $800 a night outside of Derby, and even at that I struggled to make it worth the time and work. Then I started seeing places that sleep 8 for a couple hundred a night. They're not high end, but it seems like a fairly small pool of travelers willing to pay more, and an awful lot of us competing. If I can average close to $100 a night for my studio-style one bedrooms that can be flipped in an hour, but have to compete with people charging $200 a night for my whole house (which takes many hours to prepare), for me I'm better off going with the small spaces.

    That said, it's my residence, so it is more work and hassle than for someone who owns a place that's strictly an STR, but I happily took my main house listing down this June.

    Of course I will miss that one giant paycheck come Derby time! :)

    1Reply
  • Dan Close
    OP
    Rental Property Investor · Louisville, KY · Member since 2012 · 51 posts · 31 votes
    6y

    Thanks for sharing @Dana McMahan. Its interesting, I just recently talked to someone else doing very well with small studios. One thing she mentioned that was helpful for her was allowing guests to only book one night since most of the competition requires two. 

    0Reply
  • Dana McMahan
    Real Estate Consultant · Louisville, KY · Member since 2016 · 30 posts · 8 votes
    6y
    Originally posted by @Dan Close:

    Thanks for sharing @Dana McMahan. Its interesting, I just recently talked to someone else doing very well with small studios. One thing she mentioned that was helpful for her was allowing guests to only book one night since most of the competition requires two. 

    Yep, we all have to find our niche. Mine is being dog friendly because so few places are.  This is my own dog with one of our guests;)

    0Reply
  • Brandon Farmer
    Property Manager · Louisville, KY · Member since 2019 · 5 posts · 0 votes
    6y

    Hey folks, I'm new to the platform and just discovered this thread. I live in Louisville. I'm a newly licensed agent but have been assisting people with short term rentals for several years now. I decided to get my license and get into full blown property management. Would love to make some new contacts and share advice. I have gone through the Conditional Use Permit process a few times now and may have some helpful insight.

    Does anyone have any  experience with leasing commercial space for short term rental arbitrage? I know that is popular in other cities with residential zoned property, but it's my understanding that's illegal here in Louisville. The loophole seems to be commercially zoned property...

    0Reply
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