STR Market Update in Kansas City: November

Last month I decided to share a short term rental (STR) market update according to my portfolio. The November numbers are in! Before I dive into the numbers here are some primary factors that determine monthly revenue of a unit. I plan to post these factors with every monthly update.

Primary factors that contribute to booking revenue:

1. # of Bedrooms/beds/bathrooms: How many guests can stay comfortably?

2. Location: What is the walkability to food, entertainment, or events? Short drive?

3. Interior design: Does the space have an appealing/tasteful design?

4. Quality of photography: Cell phone photos CAN work fine at first but schedule a professional photo shoot when you get the listing created.

5. Pricing: Is it priced competitively? Under-priced? Over-priced?

6. Management/Reviews: Good management of property and guest communication ensures great overall reviews and long term success.

My portfolio:

Size: 1 bedroom to 4 bedrooms units.

Location:The majority of them are located within walking distance or short driving distance to shopping, dining, event spaces, and entertainment.

Interior Design: My team designed most of our units. Designs range and mix with rustic, farmhouse, boho, eclectic, art deco, industrial, contemporary, with sprinkles of mid-century and antique pieces.

Pricing: I am constantly analyzing the market and modifying to ensure maximum profitability.

Management/Reviews: I maintain Super Host status on Airbnb which helps listings rank in the top page of the search results.

Average November 2020 booking revenue:

**Booking revenue does not include the cleaning fee collected from the guest**

• 1 bedroom / 1 bathroom: $1,798.33
• 2 bedrooms / 1-2.5 bathroom: $2,241.78
• 3-4 bedrooms / 1-3 bathrooms: $2,870.95

Average occupancy rate (# of days the unit was occupied):

• 1 bedroom / 1 bathroom: 97.78% (29 out of 30 nights)
• 2 bedroom / 1-2.5 bathrooms: 75.83% (22 out of 30 nights)
• 3-4 bedroom / 1-3 bathrooms: 59.45% (17 out of 30 nights)

Analysis:

The surge in COVID cases had a significant impact on the booking revenue. A few of my spaces were flurried with cancellations during the Thanksgiving week. I made price adjustments and I captured decent bookings for that week on most of my places.

For several 1-2 bedroom units, I signed a traveling nurse to a 3 month lease. A couple want to extend for longer which is great with me. The profit margins are smaller with this pivot strategy however this provides security during the low months and with COVID numbers and fear on the rise. I’m optimistic for travel to return to a sense of normalcy with all vaccine news developing nearly everyday.

I find that 3+ bedroom units are the most vulnerable for the coming months. The reason is that traveling medical workers normally are not looking for anything larger than 2 bedrooms.They’re too expensive for traveling medical workers unless there are a couple of them. They don’t frequently travel in pairs though. What keeps these units afloat are traveling freelancers, small business traveling groups, large families between closing on home purchases, and non-profit groups.

Conclusion:

November historically is a decent month due to football games, fall festivals, and holiday travelers. This is the first month of the low booking season. This season ranges from the beginning of November to the end of February. November and December are generally decent months with some high upside with great rates for the holiday weeks. January and February are the slowest months with low activity. It would be prudent to sign a traveling nurse for these months.

I hope this is helpful. I’d love to hear your thoughts and what you’re experiencing in the market.