All Forum Posts by: Daniel Bourdeau

I manage a STR in Unincorporated Jefferson County (Coal Creek Canyon) and lived there for a while. I'm happy to answer any questions about the licensure process for Jefferson County. They are indeed in the process of revising it. Its indeed quite a tedious and onerous process (in addition to expensive) in unincorporated Jeffco compared to other areas, but its generally friendly to non-primary residence STRs

Quote from @Bruce Woodruff:

Thoughts?

a) The numbers you show (if even true-college study) do not merit even a yawn....a .018% increase in rents? The horrors.....

b) Where will our staff and Contractors live? Where they always have, outside the city where they commute to work. Not a problem.

c) It's nice that you can focus on 'ground-up luxury builds' but those are out of reach for all but the elites among us.

The housing market is driven (as it should be) by the market and supply-and-demand. These factors will always be the best arbiters of the market.....and it will self-correct as it always does. One only needs to look at the history of the STR market over the past 5 years as an example.

Just my .02

Scale those number up to a 50%, 100% or 200% increase in supply and you'll see where the problem lies.

Not every market is a city. In remote areas, Long-Term housing is already extremely difficult to find, and they're not readily available commutable areas. You seem to be minimizing this problem.

Building short-term rentals is only marginally more expensive than acquiring existing structures. You can build a primary residence with 5 or 10% down, and you can build an investment property for the same 20% down ( plus some construction interest) that's you can acquire it for. It's far less 'elitist' and out of reach than you say. 

We've already seen some legislation propose this year restricting large entities from acquiring single family residences, and if I were a betting man, I assume that this trend will continue and it'll be harder and harder to acquire and make money off of single family residences. 

Quote from @Michael Baum:

Ugh...data "scientists"....if I had a dollar...first time I have put a member on ignore.

 Hilarious how the #1 contributor on this form has so little experience actually managing short term rentals 

Quote from @Michael Baum:

Right @Daniel Bourdeau, I see that data for CHICAGO.

What you are saying is that the data provided for Chicago would be the same for every region everywhere.

That is simply not going to be the case. Data like yours can change from as little as a distance of 100 miles.

What you are saying makes little sense. I don't have STRs in Chicago.

It's like comparing the data from sales of Audi's to the sales of broccoli and trying to conflate the 2.

Just leave it alone and me alone. I know I will not see a 25% increase in my area no matter what you think can happen in Chicago.

I've run the same analysis across markets all over the US and find the same thing consistently. I don't think you are open to any data that doesn't reinforce your pre-existing notions. I'll drop it..have a great day

Here's a published study that shows the relationship between dynamic pricing and higher revenue

Quote from @Michael Baum:

 I never called you foolish or stupid. I just said you are leaving money on the table

I never said you did. I said others have said that. You did allude to my being naive.

Here's some data across 5,000 units in Chicago (obtained from pricelabs) for full time hosts that use no dynamic pricing vs low, medium and high.

Going by averages, you are leaving about 20+% revenue on the table by using no dynamic pricing vs using a high level, like pricelabs. I'm a data scientist by trade and i just use data to back up my assumptions, and its clear that hosts that use no dynamic pricing are leaving thousands and often tens of thousands of dollars on the table. I did allude to you being naive on this topic, because the data backs me up

Bedrooms	None	Low	Moderate	High	High vs None	Percent Increase
1	$26,425	$27,725	$31,869	$32,372	$5,947	22.50%
2	$31,107	$36,901	$36,985	$42,493	$11,385	36.60%
3	$36,796	$49,764	$47,515	$53,719	$16,923	45.99%
4	$75,104	$102,719	$95,842	$93,131	$18,027	24.00%

Quote from @Derick Daigneault:

I do believe automation is useful even for low property count hosts. Guesty seems fine from what I heard, I personally use Lodgify as a channel manager.

The reps from Lodgify then advised me to get Turno for cleaning automation which works well.

I'm in the process of getting smart locks to automate the check-ins.

+1. These tools save time when you have 1 or 10+ properties. Learning them early before you scale will also allow you to scale much more efficiently

Hi everyone,

As a fellow Airbnb investor, I've been reflecting deeply on our role in the real estate market and its broader implications. I recently came across a study from UPenn in 2019 that really put things into perspective. It quantified the impact of Airbnb listings on the housing market, showing that a 1% increase in Airbnb listings leads to a 0.018% increase in rents and a 0.026% increase in house prices.

This revelation led me to a significant shift in my business strategy. I've moved away acquiring and converting long-term rentals into short-term ones. Now, I focus exclusively on ground-up luxury builds. It's a decision driven not just by business considerations (these structures earn significantly more than basic houses) but by a conscious effort to mitigate the negative impacts on the housing market.

It strikes me that not many real estate investors ponder the ethical dimensions of their ventures or the ripple effects on the communities where they operate. Consider this: as the ratio of Airbnbs to long-term rentals increases, the availability of long-term housing for residents decreases. Where will our staff and contractors live if we buy up small communities?

This is more than just an invitation to a discussion - it's a call to introspection. How does your real estate journey affect the communities you're part of? I'm keen to hear your thoughts and experiences in this realm. Let's have an open and honest conversation about the ethics and impacts of our investment choices.

Looking forward to your insights,

Dan

Quote from @Michael Baum:

Quote from @Daniel Bourdeau:

Quote from @Michael Baum:

Right now we do a flat rate for every day. I price things competitively and adjust yearly as needed.

I personally hate variable rates when I am looking for a place. Always bugs me.

I am thinking about doing variable rates sometimes, but not sure yet.

 You're definitely leaving money on the table using this strategy. Weekdays have significantly less demand than weekends - I charge about double for weekends that i do for weekdays, and have a bell curve for what my average rate is per month across the whole year

From a guest perspective, they often have no idea that I use variable rates. AirBnB in particular only shows guests the average per night, not the individual day prices, and I can round my rates such that they end in a 0 or 5.

Sure, as a guest I'd rather book a place that naively forgets to upcharge for christmas, but as a host I realize that people will pay more, and they do! 

Every area is different. Our area is very rural and in the winter, I don't get much travel there. I am not going to lower the nightly rate just to get some extra bookings. No way I want more wear and tear and lower quality guests for that time. That is a money loser.

I have calculated that we could maybe increase our yearly by maybe $1000. It is not naivete' that drives my decision making, but knowing my market.

I get plenty of commentary. How stupid I am, foolish and on and on. Mostly from people named Account Closed....

 I never called you foolish or stupid. I just said you are leaving money on the table

Quote from @Brandy White:

I have some questions regarding a short-term rental near Orlando. It is a 4 bedroom 3 bathroom townhome (1492 sqft). It boasts fantastic amenities, notably a lazy river, yet tenants are required to pay $22 daily to access these perks. Should I advertise the rental as $125 per night plus the $22 fee, or simply list it as $147 per night, amenities included? I'm seeking opinions on the optimal choice. Additionally, we've established it as a corporate rental, which is proving more successful. Any suggestions for maximizing exposure? Moreover, the owner is contemplating selling it for $350k, but it seems like a tremendous investment opportunity.

 As a long term corporate rental, I would let guests pay the added fee when they wanted to use it. As a Short term rental it would be a harder call

There are a few type of markets / regulation situations

1. Established and regulated: Many markets have been vacation destination pre airbnb, and have robust regulations as a result. These markets rely on tourism and are very unlikely regulate vacation rentals out of existance.

2. Up and coming markets- AirBnB turned some markets that historically only had hotels into new opportunities for airbnb investors. These often don't have regulations on the books to govern STRs and can be risky

3. Large Cities - pretty much every large major city in the US has restricted airbnbs to primary residences. I don't recommend investing in these markets unless you know the rules and can live within them.

I prefer to invest in #1, although i do have units across all 3 types.

Many hosts that scale up their portfolio eventually move from residential zoned properties into commercial zoned properties due to the easy of scaling up money deployed and the safety of regulations