¶ Introduction and Welcome
Hello, welcome back to another great episode. My name is Sarah Karakain.
I'm Annette Grant, and together we are. Thanks For Visiting, and this is the hosting hotline.
If you wanna get your hosting questions answered here on the hotline, all you have to do is go to hostinghotline.com, ask your question, and we'll answer it here on the podcast every Tuesday. We love doing these episodes, so have your questions ready, record 'em. And let's create
¶ Listener Question from Lori
content together. Today we have a question from Lori.
Hi, Sarah, Annette, it's Lori from Fort Wayne, Indiana. First off, I wanna say thank you for your podcast, your boot camps, and your HBM group. I have gradually grown with you folks, so my question for you today is. How to best prepare if you're thinking about selling your, uh, short-term rental property. I feel like I know my numbers so much better, um, because of the information, uh, your group has, uh, afforded me.
Um, but how do we go about finding a good realtor, uh, with short term rental and what is really important that would bring value to the property. I will tell you right now we have not been collecting any of our guest information. Um, but I do have a plan of starting with something like StayFi moving forward as we develop our plan further. And so far we have been solely on Airbnb. No direct bookings at all. Okay, thanks. And I look forward to an answer. Take care. Bye-bye.
¶ Advice on Selling a Short-Term Rental
Lori, we appreciate you growing with us on the podcast here, bootcamps and Lori is currently a Hosting Business Mastery member that is what HBM stands for. And so I know we know a little bit more about Lori's situation, um, but love that she also called it in here to the hotline
for all of you and Lori, I wanna say thank you for taking action. Uh, not just listening to the podcast, but digging deeper with us. We love, we love action takers.
Because what we prioritize in the Hosting Business Mastery is knowing your numbers, not just on the business side, but also the pricing side and potential revenue side. And I know Lori in particular, has been doing a really good job of showing up. Doing the work and seeing more of what her property is able to do for her.
And everyone listening, you are small business owners, you are not just hosts. So I want you to understand that. So let's dig in to the question here. And you gave us so much information, which is really helpful and we're gonna let you know what we would do.
So Lori, first and foremost, knowing the kind of market you're in. So, Fort Wayne, Indiana is not unsimilar, unsimilar, I think that's a word to Columbus, Ohio, or to a secondary, tertiary market in a state. Right? And so I say that because most of the people buying in Fort Wayne are going to be, uh, are going to value it like any other property, even if it's going to be, and since it's a triplex.
An investment property, but that doesn't mean that the person buying it necessarily wants to get into short-term rentals or midterm rentals. They might just want to view it as a long-term rental. And I can tell you this, if they get, if they have a lender, more than likely, depending on what kind of lender it is, if it's conventional, they're not gonna be able to wrap up the quote unquote business side or furniture that is in the property in with the loan.
So when it comes to valuing the property, it's going to be valued. As any other property would be valued.
Appraised, yes, like this, it will be appraised as a residential home, not as a short-term
¶ Importance of a Good Realtor
rental. What we can offer, we think the number one best step is to make sure you are finding an excellent, excellent, short-term rental realtor in your area. That for us would be the Paramount here, um, of who you're going to work with on this.
There's some other things about, um, like you mentioned, only being on one platform and, and not having any sort of, we'd say equity in an email list, but that real estate agent is going to be top priority because A, they're gonna help, they might know of short-term rental investors that are looking to add to their portfolio who want turnkey short-term rentals. And that could be a huge plus of being able to sell all of the furniture in the triplex to this, um, potential host or current host.
We think that's a huge value add that your realtor could help you. Um, in the sale of, of that, and also that investor might not be your traditional, you know, a traditional homeowner or investor. They might have the extra funds to make the sale go quick and, and include all of the furnishings as a part of the offer.
And I offer to Lori that that's something that could help her do is, is find a realtor in Fort Wayne who is connected in the investor circles, especially short-term rental. Because even if that. Agent doesn't connect her with a buyer who wants to keep it as a short-term rental. That agent could know of a short-term rental property management company, or another investor who does short-term rentals to help sell out furniture in one go instead of trying to do it piecemeal, you know?
Things like that, just to make it a lot easier for Lori. But that is the most important thing. 'cause that trickle down of having an agent who understands that space, who is connected in that space, can work with Lori to strategize on what is the best. What is the best thing to do? In her case, but I can tell you this 'cause I've helped people. I've sold my own property as an active short-term rental. I've helped people sell their properties as short-term rentals.
We've bought.
Yes, we've bought short-term and help, we've helped people. We've done it ourselves. What I can tell you though is when you go to value it, it's going to be valued as the property. And then everything else on top of it is where you have to kind of put puzzle pieces together,
¶ Maximizing Property Value
Lori.
And I would, um, I would offer, because these are some intangibles that could help with the sale, for instance, if you wanna share with your personal network about the property, because you might have, uh, people in your network that want to become small business owners through hosting. I know Sarah and I, one thing that. Was really desirable when we bought one of our properties together. Is that a, we already knew it was a operating short-term rental.
We knew their numbers and this third part that to us was invaluable is all of the neighbors knew. It was a running short-term rental and the neighbors were awesome. And when we say neighbors, we mean like two on the right side, two on the left side, like the whole neighborhood was down with it.
So for us, we didn't have to worry about going into that neighborhood, having those conversations, maybe a neighbor not, um, not jiving with it because that is one of those intangibles that really helped us make it a no brainer for us to go in and buy, um, the property that we bought.
So there, I wanna share with you, Lori, that there, there might be people in your network that, uh, have been very interested in getting started and you could give them, um, you know, a launching pad and, and I would add some of those, um, some of those intangibles in there.
¶ Direct Bookings and Marketing Strategy
Lori mentioned this 'cause she understands and knows this, but for anyone who doesn't quite understand it, is that. When the only way you are getting bookings is via Airbnb, and Lori knows that I'm saying this with love, like there's no value to that because those bookings and that and that Airbnb profile, it stays with you, the host. You can't technically sell that profile with the property. Have people done it? Is there a way that you can, sure, but it's against Airbnb's
we do not advises,
we do not advise it. And then what happens when they find out and they, it is just not worth it to, to, to me, what is valuable is having a business that isn't reliant on a platform like VRBO or Airbnb. So that's why Lori mentioned prioritizing, getting email addresses and we, we share it with you guys.
Week after week, episode after episode, the value of having an email list the value of having a website where you have returning visitors to your website, and that's how they find you, which is why Google Vacations is, is another great, uh, way to start, kind of like get off the Airbnb hamster wheel and start. Prioritizing.
Getting your own leads and doing the work involved in getting your own leads, because when you want to sell, that is when there is real value and you actually can bring someone in, like an expert in, to help you sell the website, the social media assets, the email list, uh, depending on how robust it is. And what percentage of your leads come from direct? Uh. Via your efforts. Versus Airbnb or VRBO and or booking.com. That's where the real value is.
Yeah. And that's how you could separate the property From the business assets. And you would be able to say, Hey, if you, yes, we're selling you the property at this price, but if you, would you be interested in the additional business assets and you can attach, um, well, that's value to those.
Yeah. You talk to a real estate attorney and someone who actually does this, this caliber. Now I can tell you that while we've, I have never helped someone buy or sell a short-term rental that had a really robust website, social following email marketing strategy. I've yet to do that. So I can't, I don't, we've had, you know, people like, um, I forget what, where he works at. It meant, do you remember Jacoby's Business? But that's what he does. Like he helps broker,
broker, but he's more of like commercial or. Property management firms.
Right, right. But also there are people who specialize in these, these more robust
¶ Creative Selling Strategies
businesses. So anyone listening right now, and if that is your dream someday to kind of like build this up and then sell it or have that be part of your exit strategy, I want you to know that if you are not prioritizing direct bookings and your own marketing strategy, that you're gonna end up selling the property as a property.
And then if you've got furniture, I see it all the time in our local short-term rental, Airbnb, Facebook group, people trying to piecemeal off a couch and some, and curtains and, and right, because trying to find someone who wants everything in your property for their own property is not likely. And then to find that perfect buyer who wants to buy the short-term rental at turnkey, it's not impossible. I've done it, but it, it might be harder.
Especially if, and this is where I wanna share with this, with Lori too, to make sure you have your numbers ready, right? Because, and even if the numbers aren't attractive, let's say that you wanna sell your property because it's just quote unquote, not making money. How many times have you seen something and you see it a different way from the person who started the creation. Right?
And you're like, Ooh, if I just added this, if I just did this to it, if I brought this kind of customer or guest to it,
Added an amenity.
Exactly. I could improve it. So don't have your numbers.
Count yourself out.
Don't count yourself out.
It doesn't mean they'll work against you.
Exactly.
They could work in your favor because they might see
Yes.
A ton of opportunity.
Exactly. So just understanding like your, I mean, when I helped, um, I had a client sell their property. We had years of historicals of pricing, the per night pricing. I could tell you what that property sold for on April 4th, 2021, like that night. And that kind of information is really helpful for a savvy investor who maybe wants to take the property, open it up as is, but then down the road, make it their own and be able to tweak it and make improvements. There is value in that.
Absolutely.
Anything else we missed in that for Lori? I don't think so.
I, I just, for everyone start talking about it, start letting people know. I think you'd be very surprised sometimes people in your, we had Stacy Race, who's also one of our beloved HBM members. She, um, was selling a property to focus on. She had multiple properties and she wanted to focus on a larger property that has events. And just in her network, there was someone that really wanted to get started in short term rentals. So she actually was a consultant for a while.
Lori, that's another way too, is maybe it's not direct in the sale, but you could come on as a consultant, as a co-host, as they get up and running. So I just encourage you to be creative. This is definitely where we have to get creative with the sale.
I was just gonna say that I was helping, uh, broker a dealer didn't go through, but it got really close. And the seller, all she had were Airbnb bookings and her own Airbnb account, but she had a bunch, like over the next three to six months and the buyer was like, well, the buyer saw the value of being able to,
just get instant income.
Exactly. And so what we had worked out is that the seller was going to be a co-host.
Learn the ropes and then,
Yes. While he created his own Airbnb account and VRBO account had the calendar closed off until those bookings, you know what I mean? And they worked at a, a percentage.
Yep.
So it's not, just because the Airbnb accounts aren't transferable, doesn't mean there isn't a win-win situation. I'm sure all of you out there too might have other ideas of how you can make this, uh, a win-win, this transition of sorts. But Lori, I can't wait to follow along and see what happens here, no matter what happens.
Let's go.
You're gonna learn all things.
Hopefully you're 10-30-1-ing this into maybe another property.
Yeah, that could be. That could be a thing too. All right.
¶ Conclusion and Farewell
With that, I am Sarah Karakaian.
I'm Annette Grant,
and together we are. Thanks for visiting. Talk to you next time.