All Forum Posts by: Ryan Moyer

For sure.  My closest that I own and self manage is a 5 hour drive.  Furthest is 30 hours.

Closest that I co-host for is 30 hours and they do great.

I remember those 2 cabins on one plot being sold together right when prices started going up.  They were on a creek, walking distance to downtown.  They weren't even that expensive and sat on the market a while because the cabins themselves were boring.  But I wonder what those things are worth now.

These markets aren't really comparable.  Aspen is expensive because rich people want to own houses for themselves there.  Gatlinburg is expensive because investors can make money there.  Two completely separate market forces.

People are willing to pay WAY over what makes sense as an investment to live in Aspen.  Not the case in Gatlinburg.

A 4br home in Aspen doesn't sell for $10M because it brings in $1M/yr in gross revenue.  It sells for $10M because rich people want a 4br house in Aspen to use for themselves.  Heck, a 4br home in Aspen probably has lower gross revenue than a 4br home in Gatlinburg, even though the property costs 10x as much to acquire.

No one in Gatlinburg is going to pay $10M for a home that does $70k/yr in gross income like they will in Aspen.  And that's fine, Gatlinburg's home values are tied to their revenue (unofficially, of course) and that revenue is great, so home prices are strong.  But a standard 4br cabin in Gatlinburg isn't going to start generating $1M/yr in gross revenue any time soon, and that's the only way 4br cabins there would suddenly cost $10M.  In Aspen, they cost that for entirely different reasons.

 I'm not sure there's any way to do this other than to use the same PMS that you link into the OTA's to create your direct book website.  For instance ownerrez has a booking widget that you can embed into your direct book website, and then everything (the OTAs as well as the direct book website) are all sync'd up through the same thing (ownerrez) and work together.

Without that, I'm not sure it's possible.  For instance I use hospitable for Airbnb/VRBO and I don't think there's any way I can create a direct book website where everything, including prices, is sync'd up between the direct book website and Airbnb/VRBO.

One of the main reasons I'm considering switching to ownerrez, guesty, etc that have direct book widgets.

Right, all those things are probably coming. But they're not here yet. People haven't stopped spending on travel yet. Again, the data is clear on this. So when people say "my STR isn't booking because no one has any money to spend anymore" they're wrong, and just making excuses so they can deflect the blame off themselves rather than put the work in to fix their issues.

People may stop spending on travel soon, but so far those host's STRs are sitting empty even when people are still spending record amounts on travel.  So imagine how bad it's going to get for those hosts if/when the big travel drop actually DOES occur.

Demand is fine right now.  Screw the anecdotes, AIrbnb earnings reports and Airdna monthly reports provide the data.  Demand is fine, still teetering on record highs.  It's just that supply has EXPLODED.

Gas, whatever.  Truck and SUV sales are at RECORD HIGHS.  This isn't like 2008 where people were selling their big trucks for pennies and rushing out to buy hybrids so they could save at the pump.  Now we have even better hybrids and full EVs and people are still shrugging off gas prices and buying big ole trucks and large SUVs at record paces.

We haven't seen the gas squeeze yet.  We haven't seen the travel demand squeeze yet.  Imagine what things are going to look like if we actually DO see those things decrease.  And not just by a little bit.  Right now all we have is a whole lot of supply and the crappy hosts that give themselves all of the credit when the market is strong but none of the credit when it's not who thought they were hot **** because they made money in a year where a blind monkey could make money are trying to blame their poor performance on gas and the economy.  But the data is clear, those things may be looming, but they haven't actually hit travel demand yet.  If we actually do get to that point those folks are REALLY going to learn a whole new definition of "struggling".

Those that keep grinding, go with the flow, actually put the effort in instead of trying to blame their failures on something else, and keep improving their listings, properties, and strategies will be fine.  As always.

Of course. And not just rates, as STR has become more and more of a stable, accepted form of investment, CoC return has and will continue to lower.

This is true of any investment niche.  When it first comes about and many people still avoid it because it's considered risky the returns are at their highest.  As it becomes more and more accepted and more and more people jump in the returns lower over time.

Same path long term rentals went down.  Every year the returns on LTR get smaller and smaller, and what people thought was "too little" 10 years ago is now considered an amazing unicorn find.

STR will be no different. As more and more people jump in, the returns will lower.

You've nailed it, EXACTLY, here.

Most of us here bought prior to the peak of 2022 which makes it difficult to be objective.

We can sit here and say our $600k house with a 3% interest rate did $120k gross in 2021 and is on pace to do $130k gross in 2022 so we're not even seeing a decrease.  But that's because we can price much more aggressively with our lower costs.  The competitor next door who bought the same house at the peak for $1.75 million with a 6% interest rate can't afford to make only $130k gross on that house.  So they have to price higher, the place sits emptier against the people that can discount a lot more due to their lower expenses, and they REALLY get in trouble.

It's hard for most of us to relate to that, because what's one thing all the people that still think everything is going just as great as ever have in common?  MOST OF THEM HAVE NOT BOUGHT NEW HOMES IN THE LAST 6-8 MONTHS.  Look at every influencer out there on youtube or wherever.  People that have been buying new homes every month or two for years.  They stopped doing that.  So we've got a lot of influencers and whatnot saying "yeah everything is still just the same as ever" while being literally unwilling to put their money where their mouth is.   Bill Faeth is very upfront about this, as he's been buying every 1-2 months for years but stopped 8 months ago and said he thought a lot of people were being irresponsible with their purchases starting around then and he had no interest in jumping in with them.

We've reached a tipping point with supply/demand due only to an increase in supply over the last year, without really much cooling in demand yet.  If demand actually starts decreasing, look out below.  The people like most here that bought years ago or bought smart and in smart markets with plenty of cushion in their underwriting will still be doing just fine.  But a lot of people didn't do that.  And those people that bought at inflated prices and high rates that are ALREADY struggling a little are going to get hit a lot harder.

I don't think that's what it means at all.  Airbnb earnings reports and Airdna monthly reports are clear on this.  Occupancy is a function of demand AND supply.  Demand is still up.  It's just that supply is up even more.  Demand was higher in Sept 2022 than it was in Sept 2021.  But the total number of listings on Airbnb was up 23% over that stretch, so even with increasing demand it couldn't keep up with the massive increase in supply.

The REALLY interesting thing, and the thing that may bring deals in the future, is what will happen if demand actually finally does start decreasing.  Because a lot of people are underwater and we're still at record highs for travel spending.  Imagine what's going to happen to them with current supply levels if demand and travel spending actually does start dropping.

 These still need to link up to a PMS widget to properly sync up pricing, right?  Something like Ownerrez, Lodgify.  Otherwise you've gotta put in individual pricing/rules for each date.