When to Start Listing Your Rental

Question

We'll be closing on our first STR in Hawaii early in May. I'm wanting to get my ducks in a row so that as soon as the keys are mine, I'm getting the prep started and opening up for business. My question is, when do I start actually advertising? I had assumed I would wait until the property was actually mine, but of course that means I'll have quite a bit of down time before we start getting bookings. A property manager I had spoken with had mentioned that they actually list homes for their clients before they've even closed escrow. They start booking out a few weeks post the scheduled close to give themselves time to prep and in case there are any extensions.

I'm wondering if anyone here has experience with this? Obviously I want to minimize the time the condo sits vacant. Upsides, downsides? I won't have primo photos right off the bat, but I think I can convince the current listing agent to allow me the use of the listing photos in the meantime. Would love to hear any thoughts!

I'm wondering if anyone here has experience with this? Obviously I want to minimize the time the condo sits vacant.  Upsides, downsides?  I won't have primo photos right off the bat, but I think I can convince the current listing agent to allow me the use of the listing photos in the meantime.  Would love to hear any thoughts!

Simone Koga · Answer

@Jon Crosby Thanks so much for the advice. You're right, I want to definitely get things lined up before May shows up or I'll be totally empty in the summer.

@James Wise Very wise (haha) to recommend some caution.  I've decided to give myself a few weeks of buffer just in case things go sideways. Hopefully it'll all work out as planne.d

@Lucas CarlThanks for the advice as always.  Good grief, some people have nothing better to do than be rude at their keyboards.  You didn't need him anyway!

@Wendy Schultz The furnishings are staying and are in pretty good condition since the unit was in a large rental pool program.  We'll need to get linens, kitchenware and some smaller ticket items, but luckily, it should look fairly like the pics for a while.

@Julie McCoy I was going to ask about the pictures but had the same thought as you.  Better to ask forgiveness then permission.  The listing agent is incredibly old school and I highly doubt she spends much time online so hopefully it'll go undetected.  They're not my favorite pics but they'll do until I can get a photographer of my own in there.  I've come to the same realization regarding the risk.  There's a much bigger problem for me if the unit is vacant all summer then if I have to cancel a few guests.

@Paul Sandhu Yep, should have done it last week!  I did end up listing just after I posted.  The more I thought about it, I didn't want to wait.

Simone Koga · Answer

@Duc Ong  This is a leasehold condotel which is an incredibly specific niche in financing.  We went through a mortgage broker Axia but the underwriting is being done by First Hawaiian Bank.  30% down required, and because the lease has fewer then 30 years we're financing over 22 years (27 years remaining on lease, bank requires remaining years - 5).  In our eyes, the investment makes sense even with the likely loss in equity, but there is actually a possibility we could purchase the fee down the line, which would be icing on a lucrative cake!

Paul Sandhu · Answer

@Simone Koga You should have listed the property before you posted a message on here.  Just put down all the facts in the ad and a first availability date way down the road.  It's like sitting at a poker table.  There is always going to be someone that loses, and everyone at the table knows who it is.  If you don't know who that person is, well, it's you.

Julie McCoy · Answer

@Simone Koga Great question!  You've gotten some excellent advice here so I'm just going to add my experience: I've listed all three of my VRs during the closing process (I've done it after inspection).  I'll use the photos available to me until I'm able to take my own.  I don't ask permission, which I'm sure is one type of etiquette breach, but I also don't want to run the risk of the selling realtor telling me I can't.  LOL  I also build in a few weeks blocked off to give me time to resolve any issues with closing, redecorate the property, etc.  I'll also note in the listing that the furniture will be updated or whatever else is appropriate.

As others have noted, there's a small risk, namely that something happens and you'll have to cancel on some/all guests.  I think the risk is worth taking vs. the (IMO larger) risk of having the property sit empty for a bit while you wait for bookings to roll in.

If I was doing a major rehab job, I probably wouldn't, because there are too many variables.  But my houses I buy just needing some cosmetic work/new furniture, so it's not a problem so far.  Doing things this way, I've always had guests coming in the second I'm ready (or mostly ready!) for them to arrive.

Wendy Schultz · Answer

I've listed my properties before closing on them. I used the pictures that I had available to me and then changed them when I got my new pictures. As long as it's the same or an improvement on the furnishings that you have in the pictures, guests won't care. I usually indicate it in the listing that the property is currently undergoing renovation. They are happy that the property is nicer than the pictures. One of my properties we slowly improved during a busy summer of bookings. There was a time when things were horribly mismatched. I notified the guest ahead of time that things would be mismatched but that the furniture that we had added would be an improvement on the furniture in the pictures. They said it wasn't a problem and were happy with the improvements.

Jon Crosby · Answer

@Simone Koga   I would start advertising as soon as you have photos ready (if you are buying it turnkey), which will be tough to get before closing unless you are inheriting or purchasing the agent's photos (which it sounds like you might be?).  If you do have them, then set up your booking platforms and simply block out your calendar up until your close date or a few weeks after (if you are planning on going to setup first).  Worst case, you can cancel the bookings if escrow goes south however be aware of any penalties to your booking platform status.   You do want to get some advertising before May as most of the summer bookings will already be in full swing by then.

Congrats again and best of luck on your island adventure!

Cheers!

Sayed Jaffar · Answer

Aloha Simone,

Congratulations on buying your investment property in Hawaii. I have been doing Airbnb/STR in Waikiki for sometime. I am leaving few questions and comments for you to consider:

1. Is the property currently in a STR program? If it is Airbnb ready, then it makes your job lot easier and there is a good chance you can list the property on Airbnb or other platforms.

2. If the property not in a STR program, or you planning on doing major or minor upgrades to the property, my suggestion is to get everything ready before you list. You may not receive revenue right away, but I think it is better than having guests in the unit who are complaining about things and leaving you less than a satisfactory review.

3. Personally, I don't put properties in rental program, unless I am certain that the unit is "fully" ready for a guest to occupy.

4. Are you planning to get professional pictures of the property? You may want to take these pictures once you have furnish the place per your ideas or requirement. And most sellers do not allow buyers to perform any work in the property which is still in escrow.

Alan Da Costa · Answer

@Simone Koga This is a great question!

For new listings, Airbnb assigns a "new" badge that bumps a room search result rank on the Airbnb site. While you have the new badge, more people will see your listing before others. Meaning you should get more bookings. The new badge doesn't last too long, maybe 1 month.

Because you only have an improved ranking for a short time, you want to get as many guests and positive reviews as possible in this time period. If you have multiple future bookings, all outside of the first month, you should know you'll likely experience a slump in viewers until reviews from those future bookings start coming in. I imagine this would translate to a drop in revenue but this could depend on your market and season.

Boost your search result rank by turning on Instant Book!

The next step to improving your return on investment is to have Superhost status. Airbnb claims being a Superhost doesn't boost your search result rankings, however, they also claim Superhosts earn 22% more than other hosts. "While the Superhost designation doesn’t boost a listing, the factors that earn you Superhost status do."

If you haven't yet reached Superhost status. Once a quarter (Jan 1, Apr 1, July1, Oct 1), Airbnb evaluates certain milestones to determine if you've reached Superhost status. These milestones are:

- Overall rating 4.8+

- 80%+ 5 star reviews

- 90%+ Response rate

- 0 Cancellations

- 10+ Trips hosted

- 50%+ Trips reviewed (by your guests)

Get that Superhost badge!

Duc Ong · Answer

@Simone Koga Thanks for the quick response.  Sounds like a decent deal.  Best of luck!

When to Start Listing Your Rental

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