All Forum Posts by: Alex M.

My 2 cents:  

1 ) Its all about finding an undervalued apartment--- acquire apartments during slow months of the season to save 10-15% on rent.  That will net you $2-5K per year.

2) Furnish cheaply.  Thrift stores + 2nd hand + craigslist.  Find good stuff for cheap.

3) Location, location, location.

4) hire a Professional to do the management.  But hire one that knows what theyre doing and isnt charging 30%.  ( I know a great mgmt company if you need one that is nationwide and puts all the "major" players to shame in terms of value/ service).

I have about 10 more "tips" I can share, but I usually charge for these.  

Disclosure: I am a full-time STR Arbitrageur that also buys properties across the country. I have good insight into most of the major STR markets. I went from broke to making over $1m in my first year- not to brag, but to show you the potential. I also haven't taken a day off in 2 years, and am happier than I've ever been.

Agree with @Avery Carl here- If you're looking for STR, Gatlinburg is a top market, but management can be an issue if you're a long-distance investor. There will be some friction in getting the right 'ground team' set up if you choose to self manage, or you can pay the very high fees the cabin companies are charging. The middle ground, is using a high quality/ full service management company that has a lower cost structure (more tech enabled) and can give you great service for around 15-25%. If you are in need, I know a great company for this. Best of luck!

We manage short-term rentals for a very modest commission compared to the existing rental companies.  Feel free to PM me if you'd like to discuss further.  Good luck!

You can set custom date rules and just keep changing it so that it wont allow for 1 night gaps.  Its a lot of work though to constantly be changing it each time there's a booking, so @Myka Artis has a good solution there to automate using PriceLabs.  I use PriceLabs as well and even though my PMS allows me to change min nights/prices, PL is more efficient and saves me time and therefore $.  

Hi, I have 30 properties that I manage by myself (while spending 90% of my time finding new deals, building relationships, and closing on a new partnership with a large financier), and would be happy to coach you.  I'm pretty confident that the strategies I offer will make your life significantly easier.  Feel free to reach out.  

Self management is harder than it seems and is stressful.  Don't be deceived by those on here telling you it's easy to self-manage. It is not. 

I echo the others in this thread that to buy in Gatlinburg, you should be speaking with @Avery Carl and @Luke Carl  

They will not lead you astray.  Always do your own due diligence, and factor in extra expenses such as higher than average utilities ($250-300/month for a 2-3 bedroom and as high as $700 in winter) and maintenance costs which can add up if your cabin seems it wasnt well taken care of-- I bought 5 sight unseen and still havent been inside them (hoping to go this month) Since you're close, drive over and get inside.   Take your time on finding a property where you believe the $/sq ft. is a good deal (usually these get snapped up on day 1 on the market, so be aggressive when you find one that makes sense.  Take your time in looking at LOTS of cabins that hit the market, scour airbnb to look at comparables and what makes a good one.  I looked at cabins every day for 6 months before buying, but now I feel I understand the market a lot better.  I also do cabin management for a price comparable to EVOLVE but we do the full service.  We aim to blow some of the cabin rental companies out of the water over the next 1-2 years.

Good luck and let me know if you need any help.

Thanks for the tag @Avery Carl.  

Joel, the market has certainly run up, but that does not mean that there are not deals out there which make financial sense for cash flow and appreciation if you consider risk-adjusted returns on capital across asset classes (stocks, bonds, other real estate plays, commodities, etc.).  I bought my first cabin last July, using Avery as my broker, and have been very pleased with my returns and with Avery's skills in helping me learn the area and choose the right cabins.  I've since spent real time building a network and learning the Gatlinburg/ Pigeon Forge/ Sevierville market.

I have a slightly different take than most on cabin management, meaning I spend a lot of time playing with pricing and minimum nights (the software pricing algorithms have not been accurate in my experience).  Therefore it actually IS time-intensive, and takes frequent changing of prices/ scanning the market for comparables/ analyzing supply&demand, etc. to optimize the occupancy/pricing mix, not to mention a bunch of other small strategies to maximize profits (I can run you through a couple if interested).  I left my job at a top strategy consulting firm in NYC to do this full time, so I have had the time to think (probably too much) about this.

I have a strong opinion on the cabin rental programs-- for instance- I closed my first cabin on July 2nd 2018.  It was rented the day after and went on to do $14k in revenue for July.  The cabin rental program it had been on previously did $9K the same month in 2017.  That's a 55% revenue increase (I dont expect that to hold true for every month, but I think a 20-30% bump is entirely possible with high-touch management from what I've seen)

My findings/ perspective:

1) Cabins are still a good investment but you need a good broker to find you the right deal (I recommend Avery as shes sharp, attentive, thinks like an investor, and has a good network of local contacts which is critical).  Do your own due diligence.

2) Self-management may be a good strategy if you have plenty of time to learn and some tolerance for stress. @Luke Carl has a lot of experience and contacts in this area, so what he can do in his sleep may take you hours.   There will be emergencies that disrupt your peace (last year during my largest Christmas reservation a well pump needed to be replaced or lose a $5k reservation).   Not to mention the tons of little questions your guests will throw at you, and coordinating cleaners, negotiating with guests/airbnb, etc..  

3) The cabin rental companies are awful and overcharge.  So first, figure out your monthly cash flow expectations, and then figure out what # you are willing to part with to turn an active into a passive investment.  I am about to launch a Cabin Rental Company of my own because I actually enjoy managing the cabins/guest experience.  Our rates vary depending on a number of factors, but since we are just starting out, we would be happy to discuss a discount for our first clients.

If you'd like to discuss rates/options, I would be very happy to get onto a call.  

All the best, 

Noah Alex 

Short-term rentals are a good business, although be very wary of some key things:

1) if you are looking at urban markets, find Commercial zoned or you may be at risk of a regulatory change.  

1a) The cash flow is higher if you rent-to-rent (vs. buy-to-rent), and also more flexible.  you can test a market, and get out easily if you need to, or switch to a new location.

1b) the overall return may be higher if you buy, IF you buy @ the right price (make a ton of offers and get a good deal/ find a motivated seller), and IF your property appreciates.

2) if you are doing rent-to-rent (this is how I was able to leave my job and begin a career investing in real estate), then you need to network with brokers and landlords.  This entails finding landlords who will let you rent their units and then sub-lease them for Airbnb.  When you find a market that works, take as many as you can and be very aggressive.  Leases are easy to get out of, so take a ton of them, and cut your losses on the ones that don't perform well.

3) if you are buying, you need a good broker and to find a good deal on the property.  a good broker can be good for leases too, but will be less motivated since you'll be new, and lease commissions are lower.  finding leases is very competitive now w/ larger, VC backed players in the game and pushing a lot of new supply onto the market through taking over huge buildings.

4) There's a lot of up-front cost if youre doing it right, since the market is gotten more competitive, you need to stand out. (invest in design, furnishings that wont break, and hustle to find second-hand furniture if possible).  Look at tons of other airnbb's to see what they are doing well/ not well.

Good luck

Agree-- Nashville is totally saturated.  Hundreds of new units going up all the time and it seems everyone and their uncle is turning their home into an AirBNB.  I dont think the returns are worthwhile anymore unless you bought in at a price years ago.  And that's coming from someone who just bought here.  And if anyone is looking for AirBNB property management in Nashville, I offer that service for a better price than the local competition- the locals are overpriced and average service imo.