Josh Chapman:                 00:01                     My warning would be don’t try to grow too quick, too fast. We have a great opportunity. This business model is great. You don’t want to grow too fast and get in over your head.

Julian Sage:                         00:12                     This is episode number 40 of the short term rental success stories podcast. Are you an investor that’s looking to have your home professionally managed? Go to cohostit.com for more information.

Julian Sage:                         00:24                     Welcome back to the 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 the 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 because 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.

Julian Sage:                         00:53                     Hey, what is going on host nation. I am super excited to be back with you again this week. Next week I’m actually going to be in Columbia for the holidays. I’ll be there through Christmas and new years. Spending time with my family, my wife’s family over there. We’re going to go to some really awesome places like Bogota, San Andres, Medellin, some really cool places 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.

Julian Sage:                         01:35                     But I do love everybody in the host family 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 rental 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 the five-star from Jenny way Mayer. Jenny says, I just started listening. I’ve gone through at least 10 episodes. I love the variety of guests, especially Dawn from Lubbock. Shout out to 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 longterm rentals and I’m looking to learn how we can add short term rentals to the mix.

Julian Sage:                         02:19                     Thank you so much. Awesome podcast. We also have from Linny [inaudible] FiveStars. 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 the 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 the show. I just love being able to share and read these reviews is just so cool to see. How this show has benefited you all.

Julian Sage:                         03:01                     But I want to jump into today’s interview or I had the honor of speaking with Josh Chapman. Josh is 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 to four rental arbitrage and three co-hosting properties and is about halfway away from allowing his wife to quit her full time job. 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.

Julian Sage:                         03:42                     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. 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 touristy, 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.

Julian Sage:                         04:27                     If you’d like my show notes for this episode, go to shorttermsage.com/str40 or if you’d like my show notes sent directly to your inbox every week, then go shorttermsage.com/shownotes. Also be sure to check out our store on vacation rental machine.com as we’ve actually opened up the freebie store where we are offering the things that we do talk about in 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, a welcome back host to another episode of short term rental success stories. In this episode, I have a special honor of speaking with Josh Chapman. Josh, would you please let the audience know who you are and what inspired you to get into short term rentals?

Josh Chapman:                 05:10                     Hey, 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 co-hosting properties and just trying to learn as much information as I can every day. So a really, really enjoy you guys videos and learning, learning from the people you have on the show.

Julian Sage:                         05:45                     Awesome. Yeah, thanks so much. You know, I, 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 a man. You are, you are crushing it right now. Two and a half months. What first got you started into this, when did you take the leap to get in your first property and how did you scale up the seven so quickly?

Josh Chapman:                 06:04                     Okay. Let’s say your first question. What led me to, to get into this? So I have a five minute answer or I have a 50 second 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 can develop some, some side side money. So over the next couple of 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 of years later now I’ve kind kinda got that streamline where I’m not having to spend a ton of time in development and growth would that so I was looking for another, a side gig and I stumbled upon a course on rental arbitrage through Airbnb and purchase this course September 1st, 2019.

Josh Chapman:                 07:19                     So a little over three months ago watch that course in about two weeks and didn’t really think twice. Of course I did some homework, did started analyzing some markets. Mmm. And then just decided to move forward. So I started reaching out to landlords and property management companies you know, CFA, they 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 a short term platforms. But all it takes is one. So I convinced management company too, 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.

Josh Chapman:                 08:21                     And really it’s been through word of mouth. Mmm. From that initial deal. That has allowed me to scale up a two, let’s see, three, four Oh four units in that market and two more potentially in the next month probably. And then in another market it’s just been, this is 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 you know, I’m up to two in this market now. So it’s just been a lot of talking and telling people about this business model and you know, whenever the right properties come along, just run in with them.

Julian Sage:                         09:09                     I want to, I want to hit on something that you brought up. 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 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?

Josh Chapman:                 09:40                     I like the potential. And this is why I’m so fascinated by what you guys talk about, how like the potential to systematize this and grow it without a ton of time and investment for only. Like I said, I have a full time day job. So, you know, I’m, I always have my phone on me always. I’m 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 in calm compared to the amount of time and, and money did it requires to make that income, if that makes sense.

Julian Sage:                         10:42                     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?

Josh Chapman:                 10:54                     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. Mmm. 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 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 and 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. Mmm. But that was, that was good. That was, that was a good couple months there.

Julian Sage:                         11:45                     Now going back because you’re, you’re in a, a very small well, the, the towns that you’re operating in an Auburn and Dothan they’re very small and w w what about these markets though? 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 a smaller markets.

Josh Chapman:                 12:16                     Yeah. well I hit on Auburn being a college town and football, 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, you’re 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. Mmm. 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 Dothan 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 Dothan. So the, the supply short term rentals is less than the demand. 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 to, comes down through dosing. So that seems to be our our typical guest is, is these the business travelers

Julian Sage:                         13:46                     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 cohost 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?

Josh Chapman:                 14:22                     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 Auburn. And this property management company I guess has some contacts in Auburn. They sent my contact information too. A lady that lives in Orlando, Florida, that has a, 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 a day to day communication, same, same day today things is I was already using for these other properties. Without the initial investment. Obviously, you know, it’s not as as profitable or as the, the potential income isn’t as high as the arbitrage, but I have zero risk the $0 million out of my pocket. So it’s all profit. And then, Mmm. Yeah. So it kind of fell in my lap really just like I said, been word of mouth.

Julian Sage:                         15:48                     And did you have like a process or way that you were able to communicate with the co-hosts 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?

Josh Chapman:                 16:11                     I think it was just through prior research. You know, I knew I had heard other people doing this cohost model and I had listened to some podcasts and YouTube videos and, 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 listened.

Julian Sage:                         17:04                     And what, 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 getting these units set up?

Josh Chapman:                 17:17                     I think they’re challenging, but just in different, different different aspects. Like I said, when I first started out, Mmm. With, with this business getting a landlord or a management company to give me the thumbs up, it was not easy because for one I didn’t have, I didn’t have much confidence cause I’d never done it. I couldn’t say, yeah. 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, 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, a real life scenarios of what I was currently doing. So I would say the arbitrage the, the, the challenges there, we’re shorter in time.

Josh Chapman:                 18:16                     They only took a couple of weeks before I was able to, to get past those challenges. The co-hosting thing is, it’s a little more challenge day to day. You have someone else that is, have, has vested interest in whether or not their property is being rented. How much is being rented for a, what types people are occupying there 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 there a risk on my part?

Julian Sage:                         19:05                     Now, you’re in a smaller destination, smaller population with, with the cities that you’re in. What did you do when you were doing your initial market research to be able to set your units apart?

Josh Chapman:                 19:16                     I really, I mean, to be honest with you, I didn’t do a whole lot. It wasn’t, 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 yea a thing that you focus on that caters to your target market. I probably could do a better job of that. Really 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 was nice things. Mmm. And I, but likewise, I can charge a higher nightly rate than those people that are getting, yeah. $400 a month rent 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.

Julian Sage:                         20:31                     Now in a Dothan and 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 your 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?

Josh Chapman:                 20:53                     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, and as I was telling you, the arbitrage that I have is very close to, to my house and I know the owner personally. So when I saw his property was vacant, you know, went to his house, it’s like, Hey, let me tell you about this business model that I am that we currently have in place. And he liked it. Of course he is, was a bit skeptical wanting me to make sure that we weren’t going to allow just anybody into his property that was going to damage it. Mmm. But I mean, it’s, you know, if I’m successful with this, this, this property, then I can go back to those.

Josh Chapman:                 21:43                     Mmm. 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, a reputable person in this town, Mmm. 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, 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 air being being their properties. So it’s going to be, it’s going to be a challenge to scale in and this market. But so far, you know, you know, in two and a half months I have one arbitrage and one cohos unit.

Julian Sage:                         22:45                     And, and just to clarify, not one in one. Total yet you have seven, seven total.

Josh Chapman:                 22:50                     Yes. But just in the Dothan market, I have one one arbitrage and one co-host, you know.

Julian Sage:                         22:57                     Okay. 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? It’s, you know, to seven units and two and a half months.

Josh Chapman:                 23:22                     I really don’t know, to be honest with you. Like I said, the first the first couple of weeks I’ve 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. Mmm. You know, I gotta so knows from some property management companies, they’re in Auburn. And all it took was finding that one, one manager to give me a shot. And we now have three arbitraging units through this same management company. And you know, they, every time they get a new property, Mmm. 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.

Josh Chapman:                 24:18                     You interested. So it’s really just finding those right contacts and building those relationships and doing a good job for him. 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 have any apartment complex units that you are arbitraging it? Yes. The three, the three places we have in Auburn are apartments. Okay. Three, three and Auburn. Our apartments. So you have a one additional that is a single family. Oh, I take that back. I tell you that all four are apartments. One’s considered a condo. But yeah, there’s a all four in Auburn are apartment/condo.

Julian Sage:                         25:10                     Okay. So the property manager, they’re giving you a apartment units for rent?

Josh Chapman:                 25:15                     Yes. That’s right.

Julian Sage:                         25:16                     That’s a good relationship. That’s nice. How much, how much are you spending on getting these units set up?

Josh Chapman:                 25:22                     Uh 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, 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, that’s what we’re seeing..

Julian Sage:                         26:04                     And, and these are, these are our higher end higher end properties that 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.

Josh Chapman:                 26:14                     Yeah, yeah, that’s a, Mmm. You know, we’re not, we’re not given the, the nicest stuff, but we’re not go and, you know, we’re not getting everything. Everything’s new. We’re, we’re not really, unless, unless I just kind of stumbled upon something on Facebook marketplace or Craigslist, that looks really, really nice. We’re getting everything new. So, Josh, you’ve tried these different business models in the past, like Amazon FBA as far as systems 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? So you’re, you’re asking in regards to this Airbnb? Yes. The short term rental thing as compared to, let’s say another business as compared to, let’s say, like another type of business.

Josh Chapman:                 27:08                     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 two, two purchase everything through Amazon or Wayfair or what, 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, well 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. Tom spent to get one set up and then, you know, the next day will 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.

Josh Chapman:                 28:11                     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. 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? This is the first, first style of investing. Okay. and is there anything, any product or service that you’re using in your business that is really saving you time and money? Yeah, definitely smart BNB. Just streamlining the inquiry responses and the request responses. And then once, once I get a booking all the pre-stay messages and just string lining those days, me a lot of time.

Josh Chapman:                 29:10                     And then I’ll say, use a price I abs for Mmm. Smart pricing, automatic pricing. So that, you know, that kind of, I used some time and energy. Mmm. And then I use hopefully as a PMs. So I’m, I’m new to that, so trying to learn, hopefully. But but yeah, those are the three, the three main, the tools that I’m using. Okay. And is there one house rule, I know that you’ve only been doing this about two and a half months, but you know, you’re up to seven properties, so I have, is there a house rule that you’ve started including in all your units that is really kind of saved you before? No, not yet. We really hadn’t had any, any crazy experiences thus far. I think the, the worst thing that’s happened, somebody spilled a cough, some coffee on a rug.

Josh Chapman:                 30:00                     So I had to charge them you know, to have the rug clean. Mmm. 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. Okay. 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? I really don’t have a strategy to be honest with ya. 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 Mmm four units that we are, that are arbitrage.

Josh Chapman:                 30:54                     So like I said, the initial investment were 20 to $30,000 so I’m trying to hit pulse on the arbitrage units right now until I can get some cashflow coming in before I can grow the arbitrage strategy. I like longterm, I like the arbitrage model for the potential income that it offers. But you know, I made, I made a couple of 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 to quit. So yeah, I mean, I, I like both models and I hope to and 2020 to grow both models. But I’m just trying to be patient. Mmm. You know, and, and it’s, and 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, Mmm.

Josh Chapman:                 31:55                     I’m at the point now where I can be more selective. Mmm. You know, like I said, we are just focusing on those higher end properties in great locations. Ight now I’m being more selective. I love, I love how, how just very you’re, you’re very confident when you’re talking about all of this. And I, you know, I think, I think it’s really interesting a lot. 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 on all your T’s. Dot and all your I’s and doing this. I, I, I just think, I think you’re doing something right and I think way that you’re approaching it, it’s not like over the top.

Josh Chapman:                 32:41                     Like you know, 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, w would you, would you do anything differently or what would you do different if you, if you did have to start from scratch? 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 did open my eyes to the [inaudible] to this business and the [inaudible] 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. Mmm. 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.

Josh Chapman:                 33:45                     So yeah, I mean as far as the ends and outs of getting properties, managing properties and just a day to day upkeep, I wouldn’t change anything. So it’s been, it’s been a great experience so far. And, and we’re, we’re excited about the future growth. Okay. Now what, 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? Well, I mean, I think the end goal you know, we met my wife, we do have two kids. She has expressed that she, well, I have 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.

Josh Chapman:                 34:39                     You know, aside from the initial a set up of a property you know, after that, you know, if you hire the right people, hire the right cleaners and, and have the right health in place then you don’t really have to be, you don’t have to have a physical presence. We do within is about two hours away from Auburn. We have a great cleaner that we work with there. She handles not just the cleanings, but 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, 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 if you have internet access, you can, I love how this, this can be done anywhere in the world.

Julian Sage:                         35:35                     And if you could give one of advice to someone who’s looking to start in this business, what would that be?

Josh Chapman:                 35:41                     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. Like I alluded to I kind of jumped down a little too quick on my Amazon FBA business. And that taught me know cashflow is very important. If you’ve never had any, do you have, if you don’t have any entrepreneurial experience the 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. Mmm. Until we can, 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 [inaudible] you, you don’t want to grow too fast and get in over your head.

Julian Sage:                         36:54                     Now going, going off of that, because you’re, 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? We’re doing co-hosting rental arbitrage first, w w where do you see,

Josh Chapman:                 37:08                     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’d know you can kind of develop a style, you can kind of furnish things, how you want the furnish then 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. Mmm. So I would say, Mmm, I would say arbitrage probably should come first. That way you can speak with confidence and with some, a little experience to these cohost opportunities.

Julian Sage:                         38:03                     I think what you were 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’s something that I had to first learn myself because my first client was, you know, myself. But then I did have a cohost client. And even with that first cohost 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

Josh Chapman:                 38:36                     Know, wouldn’t have been most beneficial. But when it’s your own money and you’re playing with that yourself, 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. The one thing that I’ve, I’ve talked with John about that we’ve really seen the co-hosting properties that we do have are very nice. They’re high end. And then the two that are pending that we’re probably going to take over in the next month, right. 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 is not being as profitable as arbitrage.

Josh Chapman:                 39:30                     Mmm. You know, the, the arbitrage unit, you do have to pay rent. And so I’m looking somewhere in $1,000 to $1,500 a month rent. These places that were co-hosting for, if I were to rent those, they would be, you know, two grand, 2,500, $3,000 a month. They’re just that high end. So that means I can charge more and my cohost, the offer 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 right. Really sweet. Mmm. That, you know, you may not otherwise have access to 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.

Josh Chapman:                 40:35                     And all you’re doing is you’re throwing that, that same type of systems that you’d be doing for yourself into yours. Yup. 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? I think I got mentioned, especially in Dosen. 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 so some competition from friends and in the near future. Mmm. But but there is, there’s, I think there’s some regulations that will probably come on in the next a couple of years.

Josh Chapman:                 41:33                     So that will make things a little more strict and limit probably where where are these properties can be located. There’s pending legislation and Auburn. Mmm. So my growth there, I’m the, I’m mindful of these areas, these designated areas that that we’ll be open to short term rentals. You know, they shouldn’t, they shouldn’t make a decision on this and the next month or two from what I’ve heard. But you know, I guess I guess a 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 lightly, but here in the near future I’m going to have to be more mindful of that. And I know you work with John and I, I’m 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 working on in your business that would take you to maybe that next level?

Josh Chapman:                 42:38                     I’m just trying to get a better, a better systems in place and not, 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, well, 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. Yeah, there’s a lot of value in that because yeah. As I scale, Mmm. You know, I’m only one guy and me and my wife are a team and Mmm. 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.

Josh Chapman:                 43:35                     So that’s really, you know, at this point was 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 no, I, the, 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 set up, 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 would, it would be detrimental to your business to be able to scale to that level. Exactly. Exactly.

Julian Sage:                         44:33                     Alright. 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 w what’s a timeline for you, where you’d like to be and how you’re going to get there?

Josh Chapman:                 44:47                     Well hopefully my wife’s employer or my employer are watching this. But but no, I think, I think, and the short term my wife is wanting to manage this from home. Mmm. Mmm. 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 ma, 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 kinda the question that, Mmm. You know, once I get to that point when I’m, when I’m up to 20, 30 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.

Josh Chapman:                 45:49                     You know, there was all this, all these regulations to Uber after it first came out and then the market kind of drove Uber. You know, th the demand really brought Uber back into the picture after all this initial, all these initial regulations. So Airbnb still early on and, and you know, the life cycle. Mmm. 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 of that word, eliminate any regulation by a local city. So I mean, that’s great. That’s exactly, that’s the same scenario with Uber. Mmm. 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 20, 30 properties, no, I think the potential income would be there for me too. 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 say an income for a year or two. So those are just some questions that there were an influence whether or not I decided to, to jump out and into this full time.

Julian Sage:                         47:23                     No, that, that’s, that’s really good feedback. And I think the, to 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, cash flow, 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 a property management like evolve or V Casa? I mean, these, 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 that one that eventually turned into hundreds and thousands. And you know, that that’s, that’s part of being able to create your brand and create your systems and to be able to create not just a way to be able to make, you know, a few extra thousand dollars, but to create something that can bring you so much more wealth and so much more scalability potential.

Julian Sage:                         48:22                     So I think what you’re doing, Josh, is so cool. I’m super, super proud of you. I think the level that you scale up to in such a short amount of time, it’s 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 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 that Josh, you know, let’s say a year from now.

Josh Chapman:                 48:56                     Yeah, that’s exciting, exciting to think about. And thank you guys you and Jon for for, you know, providing such great content, consistent, great content you guys are, are are definitely a valuable, a valuable resource for people trying to make it in this business.

Julian Sage:                         49:18                     Awesome. Well, thank you so much Josh, for taking the time and talking to the host family and until next time, host nation, keep on hosting. Hope you 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, go on over to our Facebook group, the host nation.