STRSS 40 – From 0 to 7 Airbnb Properties in 10 Weeks w/ Josh Chapman

Video Transcript

00:00:00

My warning would be. Don’t try to grow too quick, too fast. We have a great opportunity. This business model is great, but you don’t want to grow too fast and get in over your head.

00:00:12

This is episode number four, zero of the short-term rental success stories podcast. Are you an investor that’s looking to have your home professionally managed, go to cohost.com for more information. Welcome back to short term rental success stories. I’m your host, Julian Sage. This is a show where I talk to hosts about their journeys and starting and growing their short-term rental business. My goal is that you’ll be able to walk away with practical information. That’ll help you become a better host and learn how to scale your business. Like any exceptional hosts. We all strive for five star reviews. So please go on over to iTunes and let us know what you enjoy. It really helps support the show if you haven’t done so already going over to our Facebook group, the host nation to connect with the community. Hey, what is going on in host nation?

00:00:54

I am super excited to be back with you again this week. Next week, I’m actually going to be in Columbia for the, the holidays. I’ll be there through Christmas and new year’s spending time with my family, my wife’s family over there. We’re going to go to some really awesome places like Bogota, San Andreas, going to go to Metagene some really cool places that I haven’t been to yet. I’ve been to Bogota, but I haven’t been to other parts of Columbia. So I’m super excited for that. I will be traveling, but that is not going to stop me from talking with you all and recording these episodes and just sharing as much. I’ve been trying to get as many episodes as I can. I’ve been trying to get a lot of episodes done in advance, just because I am going to be gone for about three weeks and I still want to enjoy my time, but I do love everybody in the host family.

00:01:38

And we’ve, we’ve just been able to see so much growth. Actually. We’ve actually been able to reach the number one spot on iTunes for Airbnb. That is crazy Vacation Rental Machine and Short Term into success. Stories are now the number one Airbnb podcast on iTunes. That is wild, but this really is all because of you guys. And I wanted to highlight a few reviews that came in. We have a five-star from Jenny Wayfair. Jenny says I just started listening. I’ve gone through at least 10 episodes. I love the variety of guests, especially Don from Lubbock shout at the Dawn who does everything to John in the DC area who does this? Part-time I’ve learned so much from each guest. We have 11 long-term rentals and I’m looking to learn how we can add short-term rentals to the mix. Thank you so much. Awesome podcasts. We also have from linear to twos, five stars.

00:02:23

They said Julian has an uncanny ability to read the minds of his listeners. There’ve been many times where I’ve been pondering a particular challenge in my short-term rental business, and I find Julian covering topics on a podcast. The best part is there. Isn’t a whole lot of banter to fill in the time gaps. Julian fills his time with great actionable advice. It’s my new favorite podcast for all things. Short-term rentals. Karen C thank you so much to everybody that has been leaving. Awesome reviews. And please, if you haven’t done. So I would love to hear your feedback. Please go on over to iTunes and let us know what you enjoy about this show. I just love being able to share and read these reviews. It is just so cool to see how this show has you all, but I want to jump into today’s interview or I had the honor of speaking with Josh Chapman, Josh as a father of two, who works a full-time day job as a civil engineer in Dothan island, Alabama, in as little as two and a half months, Josh has scaled up the four rental arbitrage in three cohosting properties and is about halfway away from allowing his wife to quit her full-time job.

00:03:19

But Josh is such a stellar person. He’s actually in our mastermind group, the BNB empire builders, and to be able to see his growth in the short amount of time that he has been with us to where he’s going and what he’s going to continue doing. It’s just so powerful. But what you’re going to realize during this episode is that Josh lays everything out so easily and makes it very clear cut because he has this foundation. These steps that he’s been able to follow along with that has allowed him to be able to grow. So Josh shares his strategies on how he’s able to rapidly grow up to seven units in two and a half months. And the challenges he’s encountered in doing rental arbitrage. And co-hosting, it’s pretty crazy how this business allows you for that exponential growth. And when you do have that strategy laid out in front of you, it really can make this seamless.

00:03:59

And Josh shows that there’s really no excuses as where he’s living. There’s not a whole lot of people. There’s around 68,000 in Dothan, Alabama, and where his other properties are located in Auburn. There’s around 63,000. So there’s not a whole lot of people in these places. These aren’t like super tourist, the high tourist areas, but he’s able to overcome a lot of the objections and a lot of the fears of Airbnb rental arbitrage co-hosting. And he’s able to take advantage and capitalize on a market that doesn’t have a lot of competition. If you like my show notes for this episode, go to Short Term Sage dot com backslash STR four zero, or if you’d like my show notes sent directly to your inbox every week, then go to Short Term Sage dot com backslash show notes. Also be sure to check out our store on Vacation Rental Machine dot com as we’ve actually opened up the freebie store, where we are offering the things that we do talk about in the Vacation Rental Machine podcast for free for you guys. We have a couple of cool things in there right now that you can download. We have our top 10 house rules and also the automated check-in checkout messages that we use for our guests with all that being said on this week’s conversation. Hey, welcome back to another episode of short term rental success stories. In this episode, I have the special honor of speaking with Josh Chapman. Joshua, would you please let the audience know who you are and what inspired you to get into short-term rentals?

00:05:10

Hi, Julian, thanks for having me on today. Yeah, my name’s Josh Chapman, new to the short term rental deal. I started out about two and a half months ago and hit the ground running two and a half months. I’m up to four rental arbitrage properties and three cohosting properties. And just trying to learn as much information as I can every day. So really, really enjoy you guys’ videos and learning, learning from the people you have on the

00:05:45

Awesome. Yeah, thanks so much. You know, I know that you’re a part of the empire builders mastermind group. I think it’s just so cool to be able to interact with you and see your growth. And man, you are, you are crushing it right now, two and a half months. What first got you started into this and when did you take the leap to getting your first property and how did you scale up the seven so quickly?

00:06:05

Okay, let’s see your first question. What led me to, to get into the, so I have a five minute answer or I have a 52nd answer. I’ll try to give you something in between my wife. We had our first child about three years ago and when she was pregnant, she wanted to go to bed at like 6:00 PM. And instead of sitting up from six to 10, flipping the channels, I started looking online for ways I could develop some, some side side money. So over the next couple months that led me to Amazon FBA and I was private labeling goods from China and selling on Amazon and really enjoyed that. So that’s kind of a couple years later now I’ve kind of gotten that streamline where I’m not having to spend a ton of time in development and growth with that. So I was looking for another side gig and I stumbled upon a course on rental arbitrage through Airbnb and purchased this course, September 1st, 2019.

00:07:18

So a little over three months ago, watch that course in about two weeks. And didn’t really think twice. I liked how I, you know, of course I did some homework. Did I started analyzing some markets and then just decided to move forward. So I started reaching out to landlords and property management companies, you know, seeing if they would rent properties to me. And the first couple of weeks were challenging. I got quite a few nos. You know, some people were kind of skeptical, skeptical of renting these properties to me, for me then to re rent on Short short-term platforms. But all it takes is one. So I convinced a management company to let me rent a couple of properties from them. So I did it furnished them, put them on Airbnb. And they’ve been, they’ve been great ever since. And really it’s been through word of mouth from that initial deal that has allowed me to scale up to let’s see 3, 4, 4 units in that market and to more potentially in the next month, probably. And then in another market, it’s just been it’s, it’s where I live. So I have a good network of contacts here. Kind of told a few people what I was doing and they were telling some others. And you know, I’m up to two properties in this now. So it’s just been a lot of talking and telling people about this business model and, you know, whenever the, the pro the right properties come along, just run it.

00:09:08

I want to, I want to hit on something that you brought up, you, you, you brought up Amazon FBA, which is something that, you know, a lot of people that are getting into the entrepreneurial space. You know, you said that you’re a consumer, you listen to a lot of podcasts. There’s all these different types of online ways to make money. Amazon FBA being the, the, the white label style. What about short-term renting though made you want to go this way over, let’s say anything else. And what is this business model allowed you to do over the other models that you’ve tried?

00:09:40

I like the potential, and this is why I’m so fascinated by what you guys talk about. I like the potential to systematize this and grow it without a ton of time and investment for me, like I said, I, I have a full-time day job. So, you know, I’m always having my phone on me always and sitting at a computer. So if somebody messaged me through Airbnb, I’m able to quickly respond without too much distraction away from my day job. And I’m a father, I have a three-year-old and a seven month old. So even in the evenings, you know, as people messaged me on Airbnb, it doesn’t take, but a minute to respond to the inquiry. So I really liked the potential income compared to the amount of time and, and money that it requires to make that income, if that makes sense.

01:10:41

And, and in two and a half months, you’ve scaled up to seven properties. Now, how, how much, how much are you bringing in right now as per, let’s say on average per property net in two and a half months.

01:10:55

Oh, let’s see. I’d say net probably somewhere between, I mean, it varies as I was telling, telling you a little bit ago, you know, football season in a college town is a, is a peak season. So I don’t really, I don’t really want to skew the numbers too much. Whereas with that, I would say somewhere between 500 and a thousand, but again, I have a short sample size I’m only two and a half months, so I don’t have a whole lot to compare it to, like I was telling you before the football season and the, the, the market that I’m in now, that’s the, that’s the peak peak peak season. So we’re just getting through that. But that was, that was good. That was, that was a good couple months there

01:11:46

Now, going back because you’re, you’re in a very small, well, the towns that you’re operating in an Auburn and dosing, they’re very small. And w w what about these markets? So have you found to be advantageous to this model? Because a lot of people, when they think about getting into the space, they think, oh, you know, Miami or DC, or some of these hot markets where there’s a lot of people, but I mean, you’re, you’re obviously proving that it can happen in smaller markets.

01:12:16

Yeah. Well, I hit on Auburn being a college town and football is a big deal down here. So, you know, the football season is great. There’s always people, there’s always parents coming to visit their kids at school. There’s always, you know, there, there is business traffic coming through Auburn. There’s, you know, your, your typical weddings, your family functions. And, you know, there’s a lot of, there’s a lot of different things that bring people through these smaller towns, as far as dosing goes, it’s, it is a small town there’s not near as, as frequent of traffic is there is an Auburn, but Dosen, there’s just, there’s, there’s not many people taking advantage of these short-term rental markets, such as Airbnb or VRBO here in dos. And so the, the supply short-term rentals is less than the demand. It seems the hotel industry around here, there’s a handful of hotels and they’re, they’re pretty booked out during the week. So I think there’s, there’s a good bit of business traffic that comes, comes down through dosing. So that seems to be our, our typical guest is, is these the business travelers.

01:13:47

Now talk to me because you went, I mean, you you’ve scaled up just like really, really, really quickly. You’re, you’re, you’re on that exponential growth phase with your arbitrage properties, but what’s pretty unique about you as well as you’re also taking on co-host clients, which, you know, we, we teach this on Vacation Rental Machine and on the show about, you know, diversifying your investment strategy with arbitrage and co-hosts thing, which is, you know, which is something that you’re doing. But a lot of people, they don’t do that. They just focus on one model. When did you realize, like, okay, I should start taking on clients. And how were you able to incorporate that?

01:14:23

Well, I wasn’t really trying. They kind of fell in my lap. I was, I was working with a property manager that I was mentioning that was in Oregon. And this property management company, I guess, has some contacts in Auburn. They sent my contact information to a lady that lives in Orlando, Florida that has a vacation home in Auburn, that they come up to, you know, for a couple of football games a year. Other than that, it’s sitting vacant. She contacted me and was like, Hey, would you be interested in managing this? We would love to earn some income while we’re not there. So I said, sure. You know, really just using the same day-to-day communication, same, same day-to-day things as I was already using for these other properties, without the initial investment. Obviously, you know, it’s not as, as profitable or as, you know, the potential income isn’t as high as the arbitrage, but I have zero risk, the $0 out of my pocket. So it’s all profit. And then, yeah, so it kind of fell in my lap, really, just like I said, been word of mouth.

01:15:49

And did you have like a process or way that you were able to communicate with the CO’s clients? Because when you’re dealing with arbitrage units, it’s a very, self-reliant everything is up to you, but when you’re dealing with other people, that’s, that’s a whole different layer of complexity and there’s these new ways that you have to approach people. How did you, how did you set up that initial relationship and how did you know how to be able to communicate?

01:16:12

I think it was just through prior research, you know, I knew I’d heard other people doing this co-host model and I’d listened to some podcasts and YouTube videos and heard how they were approaching them. So I just followed, you know, kind of what I’d already learned, even though I hadn’t done it, but really just, you know, kind of told them, Hey, I’m having great success for these properties that I’m renting. I can do the same thing with yours. And I was able to give them some, some data for the, from the last month or two, Hey, you know, it’s just the middle of football season. Last month I made this on this property. I can, I can do the same with yours. So, you know, it, it really, when you start, when you start talking dollars with people who otherwise are, aren’t making anything, they listen.

01:17:05

And what have you found to be more challenging? Have you, have you found that dealing with co-host properties and clients more challenging or going out there and pitching landlords and, and getting these units set up?

01:17:18

I think they’re challenging, but just in different, different, different aspects. Like I said, when I first started out with, with this business, getting a landlord or a management company to give me the thumbs up was not easy because for one, I didn’t have, I didn’t have much confidence because I’d never done it. I couldn’t say, yeah, I’m managing X number of properties in this market. And, you know, I really didn’t have anything to draw from, but once, you know, once I got that first, yes. You know, I was able to point to some properties that I was managing. I was able to ask landlords with confidence and, and kind of give them some real life scenarios of, of what I was currently doing. So I would say the arbitrage, the, the, the challenges there were shorter in time. They only took a couple of weeks before I was able to get past those challenges.

01:18:21

The co-hosting thing is it’s a little more challenge day to day. You have someone else that has vested interest in whether or not their property is being rented, how much is being rented for what types of people are occupying their space. So, you know, they, they have, you know, they’re kind of looking over your shoulder to make sure that you’re not charging too little. You’re not allowing somebody who’s going to wreck their place. So, so I’d say that, I’d say the challenge is greater with the co-hosting model, but again is zero risk on my part. So

01:19:07

Now you’re in a smaller destination, smaller population with, with the cities that you’re in. What, what did you do when you were doing your initial market research to be able to set your units apart?

01:19:18

I really, I mean, to be honest with you, I didn’t do a whole lot. I probably could have done a better job in that regard, moving forward, you know, I’ve, I’ve heard John talk about, you know, kind of branding kind of having a, a, a thing that you focus on that caters to your target market. I probably could do a better job of that really. You know, I’m looking for high quality properties. I don’t want to, to take on a rent that’s $400 a month, and it’s in a terrible part of town. And, you know, I have to worry about, you know, other things I’m looking forward to the more high end properties that I can furnish with. Nice things. And I, but, but why why’s, I can charge a higher hourly rate than those people that are getting, getting $400 a month when you know, places. So to answer your question, I probably, I didn’t really do a good job of setting myself apart other than just really focusing on the higher end properties

02:20:34

Now in a dose and an Auburn. You said that at least in Dothan, it’s there, the demand for short-term rentals exceeds the supply. What, what was your relation or what, what was communication like with landlords that maybe aren’t super familiar with this? What were some of the rejections that you were hearing that you had to overcome?

02:20:56

They just weren’t, they were very closed off to it. And I still struggle with that. That’s the reason why I only have one arbitrage unit. And as I was telling you, the arbitrage unit I have is very close to my house. And I know the owner personally. So when I saw his property was vacant, you know, went to his house and was like, Hey, let me tell you about this business model that I am th that we currently have in place. And he liked it. Of course, he was a bit skeptical wanting me to make sure that we weren’t going to allow just anybody into his property who was going to damage it. But I mean, it’s, you know, if I’m successful with this, this, this property, then I can go back to those, those management companies. And those landlords that I previously talked to said, Hey, this property located at this address, I’m doing this with, and, you know, you can go talk to the owner.

02:21:58

Who’s a reputable person in this town and ask him about the experience and it’s been great. So, so I’m really, you know, this is, this is kind of a Guinea pig property that I can point to and say, Hey, we’re doing really well over here. Trust me that we can do the same with your properties and hopefully grow from there. It’s going to be a slow-go because it is a small conservative town. You know, when you hear, when people around here sometimes hear Airbnb, you know, their eyes get real big and they’re, they’re not really receptive to Airbnb being their properties. So it’s going to be, it’s going to be a challenge to scale in, in this market. But so far, you know, you know, in two and a half months, I have one arbitrage and one co-host unit.

02:22:48

And, and just to clarify, not one in one total, yet you have seven, seven total,

02:22:54

But just then just in the dose and market, I have one, one arbitrage in one co-host unit. Okay.

02:23:00

And I want to hit on that because Josh you’re doing, you’re doing something, right. Because a lot of people that get into the space, you know, it might take them a longer time to be able to scale exponentially. And that’s one of the benefits of this business is that, that, that ability to be able to exponentially scale, what, what are you doing that has allowed you to grow so rapidly? You know, to seven units in two and a half months.

02:23:25

I really don’t know, to be honest with you. Like I said, the first, the first couple of weeks, I got a lot of nos and I think that’s typical, but it’s really about finding the right contacts and, and building a relationship with them. You know, I got a nose from some property management companies they’re in Auburn and all it took was finding that one, one manager to, to give me a shot. And we now have three arbitrage units through this same management company. And, you know, they, every time they get a new property, you know, I think they’re asking those landlords, those owners, Hey, are you open to this? Because we have somebody that might be interested. So, you know, he calls me once every two weeks and say, Hey, we’ve got a new property. Here’s some details about it. You interested? So it was really just finding those right contacts, building those relationships and doing a good job for them.

02:24:30

Now that, that seems like it’s kind of the golden goose type of relationship where you have someone that’s literally saying, Hey, here’s a property, here’s a property, but you’re, you’re, you’re going the more single-family home route, as opposed to the apartment complexes. Have you found that? Do you actually, do you have any apartment complex units that you are arbitraging him?

02:24:49

Yes. The three, the three places we have in Auburn are apartments.

02:24:53

Okay. Three, three, and Auburn are apartments. So you have one additional that is a single family.

02:25:01

Nope. I take that back. I tell you that all four apartments one’s considered a condo, but yeah, it’s a, all four in Auburn are apartment slash condo. Okay.

02:25:13

Okay. So the, the, the property manager, they’re giving you apartment units for rent. Yes, that’s right. That’s a good relationship. That’s nice. How much, how much are you spending on getting these units set up?

02:25:27

Well, we have the three arbitrage unit. Well, we have one, one bedroom, one, two bedroom, and two, three bedroom arbitrage units. I’d say your base. My base expenditures is about five grand and that’s for the one bedroom. And then as you go up or as we’re going up per bedroom, in addition to one, I’d probably add on about 1500 bucks. So five grand for the one bedroom, 6,500 for the two bedroom. And I guess that put us up around eight, eight grand for the three bedrooms. I’d say, that’s what we’re seeing.

02:26:08

And these are, these are higher end higher end properties that you’re, you’re furnishing. So you’re, you’re doing some, some more expensive, not just throwing up a furnished room and saying, this is good enough.

02:26:18

Yeah. Yeah. That’s, you know, we’re not, we’re not given the nicest stuff, but we’re not going, you know, we’re not getting everything everything’s new. We’re, we’re not really, unless, unless I just kind of stumble upon something on Facebook marketplace or Craigslist, that looks really, really nice. We’re getting everything new.

02:26:39

Josh. You’ve tried these different business models in the past, like Amazon FBA, as far as systems wise, how much, how much upfront work was there with the systems to be able to get everything up and running. And how much time do you think that you’re spending on the business now, after those systems have been worked out?

02:26:58

So you’re, you’re asking in regards to this Airbnb, just the short-term rental thing,

02:27:05

As compared to let’s say another business as compared to, let’s say like another type of business,

02:27:11

I would say this is far less time intensive to get the initial. I mean, don’t get me wrong. The majority of the time is spent on the front end, but to, to purchase everything through Amazon or Wayfair or whatever, you know, that, that takes maybe a day to go down. My checklist takes about a day. And then once everything comes in, I usually get everything furnished and get the property set up on the weekend. I’ll take one weekend and you know, my wife and I we’ll have our mother and father-in-law keep the kids and we’ll go up to Auburn or, or whatever it usually takes about two days of pretty, pretty intense time spent to get one set up. And then, you know, the next day we’ll upload the photos to Airbnb. And I mean, from start to finish, I mean, we’re knocking it out in about a week, week and a half, but really it’s two days of hard work. And then, you know, once, once that set up and once we get it plugged in to the various systems, we have set up, you know, I’m spending anywhere from five to five minutes to an hour, a day corresponding with, with guests.

02:28:36

And have you, have you done any real estate investing in the past before, or was this your first style of, of investing in real estate?

02:28:43

The first dollar investing. Okay.

02:28:46

And is there anything, any product or service that you’re using in your business that is really saving you time and money?

02:28:53

Yeah, definitely. Smartbnb just streamlining the inquiry responses and the request responses. And then once, once I get a booking, all the pre-stay messages, just string awning, those saves me a lot of time. And then also use price. I abs for smart pricing, automatic pricing, so that, you know, that kind of essay some time, energy. And then I use hopefully as a PMs. So I’m new to that. So trying to learn hopefully, but, but yeah, those are the three, the three main tools that I’m using.

02:29:39

Okay. And is there one house rule? I know that you’ve only been doing this for about two and a half months, but you know, you’re up to seven properties. So is there a house rule that you’ve started, including in all your units that is really kind of saved you before?

02:29:53

No, not yet. We really hadn’t had any, any crazy experiences thus far. I think the worst thing that’s happened, somebody spilled a cough, some coffee on a rug. So I had to charge them, you know, to have the rug cleaned. But other than that, I mean, there really hasn’t been any, anything out of the ordinary. All of our guests have been good thus far

03:30:18

Now. I mean, you’re, you’re growing really quick. Josh, where, where do you see this going? As far as your growth, are you going to keep on putting more money into arbitrage units? Are you going to take on more coast clients? What’s, what’s kind of your strategy since you’re, you’re playing with both right now.

03:30:33

I really don’t have a strategy to be honest with you, you know, as properties become available, I’m just looking at them saying yes or no. I’m trying to, I’m kind of maxed out right now. We do have four, four units that we are, that are arbitrage. So like I said, the initial investment where, you know, that’s 20 to $30,000. So I’m trying to hit pause on the arbitrage units right now, until I can get some cashflow coming in before I can grow the arbitrage strategy, how I long term, the arbitrage model for the potential income that it offers. But, you know, I made a, made a couple decisions early on in my Amazon FBA business that I had to learn from financially. So I’m trying not to go down that same road and get in over my head too quick. So yeah, I mean, I like both models and I hope to in 2020 to grow both models, but I’m just trying to be patient, you know, it’s, it’s hard because you know, every couple of weeks there’s another property that’s being thrown at me and unless it’s a good fit, then I’m to the point now where I can be more selective, you know, like I said, we, we are, we are just focusing on those higher end properties in, in great locations.

03:32:12

So I’m able to be right now. I’m being more selective.

03:32:16

I love, I love how, how just very, you’re, you’re very confident when you’re talking about all of this and, you know, I think, I think it’s really interesting. You’ve, you’ve just had this like crazy growth doing really well, knocking it out of the park, as far as getting everything set up the right way, you know, crossing all your across all your T’s dotting all your I’s and doing this. I, I, I just think, I think you’re doing something right. And I think the way that you’re approaching it, it’s not like over the top, like you’re, you’re, you’re going through the motion and you’re doing everything the right way. If you could go back and redo it, would you, would you do anything differently or what, what would you do different if you did have to start from scratch?

03:32:59

Yeah, we kind of talked about this, you know, the initial cost of the course that I took was a bit, a bit high. I probably would have saved that money, but I mean, it, it did open my eyes to the, to this business and the possibility of, of the, you know, of this, this business model. So I don’t want to complain too much about that initial cost. I did give me a good base understanding of how everything works, but there is a lot of great content that you guys and others that are in this space provide that is just as good as, as this paid course that I took. So, yeah, I mean, as far as the ins and outs of getting properties, managing properties and just the day-to-day upkeep, I wouldn’t change anything. So it’s been, it’s been a great experience so far, and we’re, we’re excited about the future growth

03:34:08

Now. W w I mean, this is all kind of come on so quick, but what, what, what’s your, what’s your end goal? Like what, what’s the reason why you’re getting into this business and what, what do you like so much about it?

03:34:18

Well, I mean, I think the end goal, you know, we’d met my wife. We do have two kids. She has expressed that she liked to work from home if possible. So, you know, this is something, if you have a computer or a phone, which everybody has a computer, and everybody has a phone, this is something you can do from home. You know, aside from the initial set up of a property, you know, after that, you know, if you hire the right people, hire the right cleaners and have the right help in place, then you don’t really have to be, you don’t have to have a physical presence. We don’t turn as about two hours away from Auburn. We have a great cleaner that we work with there. She handles not just the cleanings, but the, if I need to pick up any supplies or shopping, or if I have to go by and get keys or, or whatever it may be, you know, we, you know, rely on her a lot and she does a great job for us. So we love the flexibility that this business offers. If you have a wifi signal or, you know, if you have internet access, you can, I love how this, this can be done anywhere in the world.

03:35:38

And if you could give one piece of advice to someone who’s looking to start in this business, what would that be?

03:35:44

I would say be smart, take things slow, but not too slow. You don’t want to, you don’t, you don’t have to have the answer to every question to take that first step, but just doing the due diligence. W like I alluded to, I kind of jumped down a little too quick on my Amazon FBA business. And that taught me, you know, cashflow is very important if you’ve never had any, if you have, if you don’t have any entrepreneurial experience, they are hyper aware of where your money’s going. And, you know, you can, you can get, you can put yourself in a bad situation and be strapped for cash. If you’re not careful about your growth speed, which is why I’m having to hit pause on, on my growth right now, until we get some, some steady cashflow going. So my mum, my warning would be, don’t try to grow too quick, too fast. We have a great opportunity. This is, this is, this business model is great, but you know, you, you don’t want to grow too fast and get in over your head

03:36:58

Now going, going off of that, because you’re doing both co-hosting and arbitrage, would you recommend, what would you recommend for someone who’s just starting off? Do you recommend doing both at the same time or doing co-hosting rental arbitrage first? W w where do you see?

03:37:12

I think to me, I think what we did where the rental arbitrage, I would say I would recommend getting one rental arbitrage unit first. So that way, you know, you can kind of develop a style. You can kind of furnish things, how you want the furniture down and, and you kind of get an appreciation and understanding of what things cost. So that way, when you do have a cohost opportunity, you can tell the owner, Hey, it’s going to take about two grand for me to take your property to where it needs to be. So I would say, I would say arbitrage probably should come first. That way you can speak with confidence and with some, a little experience to these co-hosts opportunities.

03:38:07

I think what you’re saying, Josh, I think that that’s so true. I love what you said about getting the confidence in the experience first through that first arbitrage property, because you’re not messing with somebody else’s money. And that that’s something that I had to first learn myself because my first client was, you know, myself, but then I did have a co-host client. And even with that first co-host client, there was, there was things that I was doing. Like I was ordering maybe things that I wouldn’t have actually purchased, or I was recommending to them to do things that maybe, you know, wouldn’t have been most beneficial, but when it’s your own money and you’re playing with that yourself, you, you get it. You can, you can afford to make those mistakes. And it doesn’t poorly reflect on anybody except yourself. But when you’re doing that with a cohost client, you know, those mistakes really can, can hinder your growth and your ability to maybe take on more clients from that person as a reference.

03:39:02

The one thing that I’ve, I’ve talked with John about that we’ve really seen the cohosting properties that we do have are very nice. They’re high-end. And then the two that are pending that we’re probably gonna take over in the next month are far beyond what I ever can, could afford. So, you know, the, the potential profit, you know, I don’t, I don’t want to dismiss co-hosting as not being as profitable as arbitrage. You know, the, the arbitrage unit, you do have to pay rent. And so I’m looking somewhere in the thousand dollars to $1,500 a month rent these places that we’re co-hosting for. If I were to rent those, they would be, you know, two grand, 2,500, $3,000 a month. I mean, they’re just that high. And so that means I can charge more. And my cohost, the off of that nightly rate is reflected by how nice these places are. So I would say on average, your arbitrage units will be more profitable, but co-hosting is nice because it gives you access to these vacation properties that are like really sweet that, you know, you may not otherwise have access to.

04:40:26

Yeah. That, that, that that’s so true. You know, it’s when you, when you do have those clients that are bringing in, you know, let’s say 7,000, $8,000. I mean, if you’re making 20% off of that, that’s, that’s, that’s a good chunk of change. And all you’re doing is you’re throwing that, that same type of systems that you’d be doing for yourself into yours. Yep. And where, where do you see short-term rentals going in the future? And let’s say your market, because these are smaller populations, smaller, smaller destinations, where, where do you see short-term renting in these locations going?

04:40:59

I think I got mentioned, especially in dose, and there’s just not, there’s not a whole lot of, of short-term rentals made available. So I think it’s definitely going to grow. It’s a small town, so there’s, there’s people catching word of what I’m doing around here. So I think, you know, I might have some, some, some competition from friends and in the near future, but, but there is there’s, I think there’s some regulations that will probably come on in next couple years. So that will make things a little more strict and limit probably where, where these properties can be located. There’s pending legislation and Auburn. So my growth there, I’m mindful of these areas, these designated areas that, that will be open to short-term rentals. You know, they should, they should make a decision on this in the next month or two from what I’ve heard. But, you know, I guess, I guess really you really have to keep an eye on requirements and, and the walls, local walls. And I haven’t really had to do that lately, but here in the near future, I’m going to have to be more mindful of that.

04:42:26

And I know you work with John and I in a, in our private mastermind group, but if where you are right now, if you could, what’s the one thing that you’re working on, you’re working on in your business that would take you to maybe that next level,

04:42:41

I’m just trying to get a better, better systems in place. And I think that’s why being a part of the mastermind is so valuable and having, having access to you and John through that, you know what, John, I don’t know how many properties he’s up to now, but, you know, eventually I like to be there and, and getting, you know, getting some, someone who’s experienced with managing that many properties, hearing how he has systematized everything. You know, there’s a lot of value in that because, you know, as I scale, you know, I’m only one guy and me and my wife are a team and, you know, we, we can’t handle it all. So getting some, some input and some knowledge from someone who’s able to, to be as efficient as possible, there’s a lot of value in that. So that’s really, you know, at this point with seven, seven properties, I’m just trying to learn as much as I can. So that way I’m not having to learn on the fly. When I get up to 20, 30, 40 properties, I’m trying to learn everything I need to know for 20, 30, 40 properties right now, when I have the time to

04:43:58

No, th th those systems are so important. And that’s why it’s so cool to be able to see you in the group and seeing, you know, what are the things that you’re working on in your business right now that, you know, you could go back and check mark those boxes to make sure that you do have the right systems in place so that when you do get to that point where you do have 20 plus properties, and you’re operating at a different level of scale, that you do have your foundation set the right way, because if you didn’t have that PMs setup, if you didn’t have those automated messages, if you didn’t have a way of hiring new cleaners constantly and having a constant funnel of cleaners, it, it would, it would be detrimental to your business to be able to scale to that level.

04:44:34

Exactly.

04:44:37

And the last thing that I want to find out is what do you, do you see this being like a full-time thing for you? I know that you’re working a full-time job. Do you see you doing short-term renting full-time in the future, or what, what’s the timeline for you where you’d like to be and how you’re going to get there?

04:44:51

Well, hopefully my wife’s employer or my employer aren’t watching this, but, but no, I think, I think in the short term, my wife is wanting to manage this from home and, you know, I mean, we’ll see where it takes us if it, if it, if it makes sense for me to leave my career, you know, the, the big thing, I guess, that, you know, this might not be what you want to hear, but, you know, seeing where having a better idea of where this business model is going to be 10 years from now, that’s, that’s kind of the question that, you know, once I get to that point, when I’m, when I’m up to 2030 properties, that’s the question I’m going to be asking, is this sustainable? Is this, you know, I know I’ve heard people, I think you guys were comparing Airbnb and short-term rentals to Uber.

04:45:52

You know, there was all this, all these regulations to Uber after a first came out and then the market kind of drove Uber. You know, th the, the mayor really brought Uber back into the picture after all this initial, all these initial regulations. So, you know, Airbnb still early on in, in, you know, the lifecycle and there we are seeing some regulations, but, you know, I think I saw something the other day, an article where I think the state of Florida is looking to create a law that would eliminate any regulations by a local city. So, I mean, that’s great. That’s exactly, that’s the same scenario with Uber. You know, the demand for short-term rentals in Florida is speaking louder than the people who are opposed to it. So if that, if that’s the case, then maybe this could be a long-term gig, but once I get up to 2030 properties, you know, I think the potential income would be there for me to, to make this a full-time thing, but asking the question, Hey, is this going to be around in 10 years? Can I make a career out of this rather than, you know, just an income for a year or two? So those are just some questions that, you know, that there were an influence whether or not I decided to jump out into this. Full-time

04:47:26

No, that that’s, that’s really good feedback. And I think that’s the kind of answer not to answer it, but to give some perspective on that is like you were talking about with Uber when you’re talking about scaling. And when you’re talking about creating a business, not just, not just a way to create cash cashflow, but in order to do this longterm is when you’re looking at, you know, those, those models such as like Saunder or lyric, or your, you know, in the rental arbitrage space, are you talking about property management, like evolve or V Casa? I mean, these are companies, they all started off, you know, they all started off just managing a few properties. You know, they all started off with one, but it was at one that eventually turned into hundreds and thousands. And you know, that that’s, that’s part of being able to create your brain and create your systems and to be able to create not just a way to be able to make a few extra thousand dollars, but to create something that can bring you so much more wealth and so much more scalability potential.

04:48:25

So I think what you’re doing, Josh is so cool. I’m, I’m super, super proud of you. I think the level that you’ve scaled up to in such a short amount of time is just so awesome. And to be able to communicate with you, you know, on a, on a weekly basis in the, in the empire builders mastermind group, I love it. I want to keep seeing you in there. I want to keep talking to you, and I think that you can provide so much value and I’d love to get you on the show again, when, when you have scaled up to that 20, and you’re, you’re taking on a whole different level of systems. And to hear your perspective from Josh, you know, two and a half months to Josh, you know, let’s say a year from now. So yeah.

04:49:00

Yeah. That’s exciting. Exciting to think about, and thank you guys, you and John for, for, you know, providing such great content consistent, great content you guys are, are, are definitely a valuable, valuable resource for people trying to make it and this business.

04:49:21

Awesome. Well, thank you so much, Josh, for taking the time and talking about the host family, and until next time, host nation, keep on hosting, hope the hosts benefit from the show. If you found value, please go on over to iTunes, leave us a review and let us know what you enjoy about the show. If you’d like to talk to hosts that have been featured in these episodes, as well as the community, going over to our Facebook group, the host nation.