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Today Jordan and Tony talk about three ways to separate yourself from the competition in vacation rentals. If you are looking to get an edge and rise above the fold, make sure you follow these three essential steps.
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STR Wealth Conference by Bill Faeth
Show Notes
[00:00:00.000] – Tony
I just looked at one of ours earlier today, and we’re at $111,500 for the year in gross revenue. So if you want to talk in terms of 15%, I mean, that’s a big number right there. And the photos are only going to cost you about $300. So if you want to talk about the biggest return on your investment, that’s a great place to put your money.
[00:00:23.590] – Intro
Welcome to the Michigan Short term Rentals Podcast, the show about buying, optimizing, and managing short term rentals in the state of Michigan. Get insights and recommendations from vacation rental operators to help take your property to the next level. Are you ready to profit from your short term rental? Let’s get started.
[00:00:45.410] – Tony
Welcome to the Michigan Short term Rentals Podcast. My name is Tony Santo, and I’m here with my cohost Jordan Painter. Today we’re going to be talking about three ways to separate yourself from the competition. What’s up, Jordan?
[00:00:58.740] – Jordan
Tony, what’s going on, my friend?
[00:01:00.450] – Tony
Just coming off the Thanksgiving weekend here. How did it go for you?
[00:01:03.780] – Intro
It was good, yeah. Had a nice little break. In the real estate world that I live in, holidays tend to be the times where things kind of slow down a little bit. Not a ton of new activity and new listings to have to chase buyers around to go look at. So I had a nice long weekend. How about you?
[00:01:18.070] – Tony
Technically, I’m a little bit newer to the real estate industry, but I would say it was actually my busiest weekend. So put a couple of offers and aggressive offers on some places. So far, both of them have come back as a no, but I think we’re pretty close to potentially being able to get them. So either way, it was fun. It’s fun going to look at it. I like putting in aggressive offers, so other than that, went over to my mom’s and my wife and I had a date night and we were able to go out and she wanted to actually set some goals and kind of talk about the three year vision. So that was fun and exciting. I also see you sent me a picture. You got that game, cover your assets. Did you get a chance to play that?
[00:02:00.390] – Jordan
I did get it. We did not get a chance to play it. Yes. It came in the mail late Sunday night and so, yeah, hopefully we’ll have a chance within the next week or two to get it on the table and hopefully learn a new game and it looks like a fun one, but yeah. So, Tony, interesting point, running around showing houses all the weekend. Great time of year right now to find houses that are getting a bit stagnant sitting on the market for a while and throw, as Tony likes to call them, aggressive offers. Some might call them mobile, some might call them crappy, but great time of year to try to go after those opportunities and eventually one’s going to get accepted. So it’s just a matter of time.
[00:02:33.460] – Tony
Absolutely. What do you say we get into it? Three ways to separate yourself from the competition. Number one, pictures. So I talk about this all the time on LinkedIn. It really is kind of the most mandatory thing yet in emerging markets like Southwest Michigan where we’re operating. You can just tell the competition might not be as highly competitive as in Orlando, Florida. So when you’re scrolling a lot of these properties, you can just see that the pictures aren’t what they should be. The COVID photo isn’t great. I was looking in an area the other day, and I think there were six places that had a hot tub or a pool. And when you’re scrolling, it literally showed, like, hey, a picture of the living room, picture of the dining room table as the COVID photo. That is definitely not what you want to do. So not only is it having great photos, but it’s also making sure that you’re showcasing the best photos first. So even though there are more properties coming into the market, into these markets, I look at them and I look at how they’re being run, to me, doesn’t really seem like true competition.
[00:03:50.820] – Tony
What do you think of the pictures?
[00:03:52.320] – Jordan
It’s actually funny. When we bought and started running our first short term rental, I remember looking at what our competition was going to be when we first went on to the market. In one of the pictures, the front picture, the COVID photo of one of these properties that was asking a pretty decent amount of money. I mean, I think this is coming into July, a year and a half ago. They’re asking five or $600 a night. The COVID photo was some dude bending over, cleaning up the yard, doing something. So, yeah, the bar can be low in some markets, and it’s just really important to have that eye catching photo, especially when people are just basically looking through these thumbnails of dozens or hundreds of options. You got to have something that’s going to catch people’s eye and make them look deeper into it. They’re clicking to save a bunch of options to look at later. You want to be one that they’re really giving some consideration to. So it’s a big deal. Shout out to Toby Bloom. We use next door photos. I’ve used them for years for all of our photos that we’ve taken.
[00:04:48.400] – Jordan
They do a great job. They do drone shots. You can do matterport tours. You can do all kinds of really cool things. But definitely finding somebody to take professional photos. If you’re going through a house and taking photos with your phone, you’re missing the boat. I don’t care how good your camera is, they just don’t have the resolution and the angles and the types of things that professionals do and the lighting and all those things. So definitely important to have a professional in your quarter to do that. It’s really affordable. And when you look at these properties, you only have to do it once and you get to use those photos year after year to promote and market that property. So big deal.
[00:05:23.010] – Tony
Yeah. One other thing I would mention would be I try to go on site with a photographer I know next door. They do a lot of real estate sales photos. I really like to be on site and try to catch some of the hospitality. So you really can’t take too many pictures. Again, 20 is kind of the bare minimum. We have properties that are going to have like 85 to 90 photos. So you really want, especially if it’s on the luxury side, you just really want to kind of capture that entire home, if you will. So we’ll take pictures of, hey, the coffee bar set up, the towels, how they’re rules, how they’re placed. So just those things that are going to say, hey, this is our hospitality, and make it feel kind of warm and cozy for people to come and stay with you. The other thing I would say is I’ve seen something that said professional photos will increase your gross revenue by 15%. So I just looked at one of ours earlier today and we’re at $111,500 for the year in gross revenue. So if you want to talk in terms of 15%, I mean, that’s a big number right there.
[00:06:34.840] – Tony
And the photos are only going to cost you about $300. So if you want to talk about the biggest return on your investment, that’s a great place to put your money. And then I’ve also heard that Airbnb, part of their algorithm is going to be based on they can tell if those photos are professional. A lot of the professional photos are going to have bigger file sizes and stuff. So if you’re uploading them off your phone and that kind of stuff, they’ll know that they’re not the best photos and they will deprioritize that. So just something to keep in mind. That’s great.
[00:07:08.220] – Jordan
Yeah. And I think that leads us right into number two, which is amenities. And Tony had mentioned the way that you’re having these photos taken is really important. A lot of the real estate photographers, particularly, they focus on the space and the rooms and the finishes and those types of things, but they’re not necessarily as focused on some of the amenities. And so you just have to make sure that you’re getting those good photos of the amenities, which being number two is really important to talk about. One of the amenities that you want to try to have Tony kind of work on compiling a list of some of the lower hanging fruit as far as amenities go, more affordable ones. So why don’t you hit us with those, Tony?
[00:07:47.130] – Tony
I’ve seen places where they basically have no amenities there. There’s nothing fun necessarily about that place. And I think a lot of people think, hey, I got to spend a lot of money to make it a fun, inviting place. But I went through and compiled just a list of, hey, if I could only spend $1,000 on amenities, I think this list would really help do the trick. So I’ll just quickly read through it. So $250 on a used Nintendo Switch bundle and then $250 on a new ping pong table, $80 on a cornhole board. Hand jam poptarts is kind of a new, interesting game that I thought would be fun and different than what other people have. Definitely get a volleyball badminton set for $100, brand new, $20. Go on Facebook, search for games, and you can probably buy 20 plus board games for $20. So just find somebody that has a bunch of board games, buy them out, get a football kickball. I mean, kids, if you think about some guys coming for maybe a bachelor party, you got a football at the place throwing around, especially if you go to the beach. They can kick the football to the beach.
[00:08:57.280] – Tony
Disc golf basket with three discs, $70, brand new. So if you have a good sized yard, get some disc golf baskets out there. Again, $70. We’re not talking an arm and a leg here. I would get a beach pass. I know that’s not something that’s at your property, but if people are spending decent money to come to your place, hey, they know when they get there they have a beach pass. It’s not nickel and diamond. So I think that’s just hospitable, but also just a fun amenity as well. Yard pong, chess set, whistleball set, and then a dartboard set. So all of those you could get for $1,000. And again, I think this is really going to set you apart on what some of the other fun amenities that people might have. So we’ve done another podcast. Make sure you go back and listen to that. Our three favorite amenities, but those are going to be a little bit more expensive one. So if you want to get the money and you want to spend some, go check that one out.
[00:09:53.370] – Jordan
Yeah, that’s good. And I think that as far as just being something other than a house to sleep in, if all you’re doing is providing a functional spot for people to stay, that’s great. And if it’s done well and it’s nice and welcoming and clean, you’re going to get bookings. But if you really want to maximize your profit, maximize your bookings. Then it comes down to when people are picking between two or three or four of the top options that they have. At a certain point, all things being equal, the houses are comparable. They’re going to go where they’re going to feel like you’re going to have the most fun. So really what you’re doing with the amenities and the photos is you’re selling them. The dream of a vacation, you’re really selling them the idea of, hey, what is it going to be like when we get there? What are we going to do? You’re giving them that excitement around coming to your property to stay and enjoy. And so typically when people are going to be coming, they’re not coming just for the property, they’re going to be doing other things. But it’s also nice to have just those added bonuses that people can enjoy while they’re on vacation and there to go to the beach or wine tours or whatever else.
[00:10:58.440] – Jordan
There’s a lot of relaxation that’s going to happen and a lot of fun right at the house. So you have to help to paint that vision for people, the marketing photos that you’re doing and the amenities that you’re highlighting in those photos.
[00:11:09.280] – Tony
Absolutely. And the third one is going to be designed. And I think just before we started this podcast, I think you made a great point, Jordan, that pinterest don’t mean anything if it’s crappy design, right? So I can’t speak a lot to how to appropriately design, but I can tell you from personal experience, call it at my own house. It’s like me and my wife can try to figure this out, but we’re not the best at design, so the best thing I can recommend, same with pictures, right? Get a professional. A professional interior designer decorator is going to be worth their weight in gold. So definitely spend that money. And if you do work with us, that’s actually part of the service. So let’s say you come on board. Part of our offering is that, hey, we’re going to pay for that initial design staging consultation so that we can make sure that we’re really putting our best foot forward with your property and make sure that, again, it just resonates with people and that they really like the design. So I know, Jordan, your wife actually is all design and decorating, so she’s really strong in that area.
[00:12:22.680] – Tony
So you might be able to speak to design a little bit better than I can.
[00:12:25.960] – Jordan
Yeah, she does a great job with that. She really enjoys it. People have a passion for it and then to be drawn towards it. But I would say, like Tony mentioned, that it’s really important to have a professional, if you’re not really gifted in that area to hire a professional. Again, it’s something that’s affordable to do. They can give ideas for color schemes and things like that. And I would also say if you’re doing this for yourself, there’s two things to think about. One is what is your target market? Who are you designing this house for? So a lot of people can make it inviting and welcoming and good color schemes and those types of things. But who’s going to be actually booking your place? Are you in an area where you’re going to be mostly getting young families with kids? Are you going to be getting younger couples are you going to be getting bachelor parties. Bachelor parties. What is the target market that you really feel like is going to be drawing people to your place and you want to have some design around that. So one of the ideas that I heard at a conference that I went to actually that I thought was interesting was having different rooms designed in different ways.
[00:13:23.460] – Jordan
So you could have your kids room and it could be Disney or Star Wars or something like that. And then you could have another room that’s an adult themed room that might just have high end finishes and nice bedding and the right type of pictures and artwork on the walls, things like that. A couple of ours, we’ve gone pretty heavy on the beach theme because that’s typically what we see as far as the guests that we’re seeing, they’re coming for the beach and things like that. So I think it’s just important to know who you’re going to be marketing for. What is your ideal guest. Some people prefer to have different guests in their target market than other people. So identifying what that target market is and then designing your place around whatever that market is, is really important from the start. And you can save yourself a lot of hassle based on what type of people are booking your house based on the way that you design it.
[00:14:15.260] – Tony
You and I have had quite a bit of debate on call it themes. Right? I think let’s talk just 1 second on going in one theme and I’ll just pull one up as an example and it would be I think we’ve seen one that was like very game theme oriented, if I remember right. But it was like, this place is just like game central and you’re like, yeah, this looks awesome. They did a phenomenal job. Definitely a very unique place. I think that’s what Airbnb is really trying to promote as well as just unique state. So I mean, they definitely take that one out of the park and did a good job with that. I’ll see if I can find it and drop it in the show notes for people to check out if they want. But when I look at that, I just wonder, do you attract more than you repel? And so that’s kind of my stance on that, is that you’re actually casting a much smaller net, if you will. So what are your thoughts on that?
[00:15:16.680] – Jordan
Yeah, I agree. I think it just comes down to what you’re targeting. And I think the person that I heard speak at the conference, they did mention to do different themed rooms so that you’re not all in on one and the one that you’re referencing, they went all in on like arcade and video games and stuff like that. So I think you probably do risk alienating people if you go over the top throughout the whole house. But I think it’s kind of fun. So again, I think it’s just for people that want to have a good time and enjoy their place. If you have a passion for something specifically you could do some design around that. But I would also be careful on going overboard for sure. The first one that we did, we really thought the big house sucks. A lot of people just had a really cool vibe to it and we really thought it was going to attract families with kids and things like that and we have had some of that but we mostly had the couples and the bachelor parties and the bachelor parties and those types of things. So really we designed that house to fit both.
[00:16:15.690] – Jordan
But it does have a couple of rooms particularly that are really pretty hardcore designed for being in kids rooms and bunk beds and those types of things. And I wonder if it really made a difference on how we design that. I don’t know that really had the impact we thought it would.
[00:16:29.440] – Tony
Just for the record, I am aligned with the call it one room and stuff. Definitely think that having one. I went to a conference in June, bill Faith is STR Wealth conference. They have another one going in March. But one of the big things was like said, just one room. I mean it doesn’t have to be having different themes in all these rooms but have one room that just pops or that just looks super fun and exciting to be at. So I think if you do just focus on having that one, that can kind of be a scroll stopper that can definitely give you the edge and get people to jump into your listing and review it a little bit further. So definitely line with that. But sometimes again, when I see people going all out on one particular theme, I mean, arcade games to me, I know I followed up with that listing for a couple of months and I never seem to get a booking. So I think that’s what I would anticipate happening is that it’s just a little much for the majority of people.
[00:17:35.740] – Jordan
Yeah, I would agree. And then I think one thing that we didn’t mention that is also really important and I think really drives as much traffic as what we’ve already talked about is the exterior amenities. What is the fire pit and the fireplace look like? You have like really nice lawn chair, lawn furniture. You have a pergola, you have some kind of indoor outdoor living space. So don’t just focus. Don’t forget to really make it pop outside as well. You really want a full design where in any type of season or weather people can be enjoying the property that you have.
[00:18:06.760] – Tony
That’s a good point too because obviously southwest Michigan, the season that most people are going to go there is in the summer season, right? So you might focus a little much on the inside one, really, a lot of people will be in there, but for the most part, they want to be outside, they want to be having fun. So, I mean, our cover photo, I haven’t changed it. I don’t think there’s any need to change it again. It’s doing really well. But our cover photo is the picture of the fire pit and the eight foot bear sculptures. So, yeah, it looks really cool. I do think it’s a scroll stopper. Luckily, it was already there. I’ve heard it can be pretty pricey to carve those types of sculptures, but I always tell people we probably have the coolest fire pit in Michigan. So if anybody wants to take a stab at dethroning us on that one, go ahead and send over your best player pit pitcher, and we’ll see. So, yeah, great points.
[00:19:00.730] – Jordan
Jordan always would love new ideas. I think overall, just to put a bow on it today, you got to make sure that you’re bringing in the best people that can help you design and stage and photograph and all those things. Don’t try to do this stuff yourself. Too many people want to save money and kind of cheap out on some of this stuff. This is where you really need to make sure that you’re investing from the start to maximize the profit. So you need advice. Find somebody that knows exactly and that specializes in these areas of expertise, whether it be the staging of the photos of the furnishing, make sure that you have somebody that has an eye for that and really bounce ideas off people and make sure that you’re not in an echo chamber and just designing something too specific for you. It’s not going to appeal to the masses.
[00:19:48.690] – Tony
Yeah, I agree. All right, that’s it. Thanks for tuning in. If you get a chance, could you please go over to the Apple podcast and leave us a review? It just really helps us get discovered in that platform. If you’re on Spotify, please leave us a review. We’ve gotten lots of good feedback, lots of people leaving reviews, so really appreciate those that have taken the time to do that. And if you’re not on the Michigan shortterm rentals.com email list yet, go head over to that site, and right on the homepage there, there’s going to be a form. You can put your email address in there, and you’re going to get a four part email series that’s going to give you a list of 650 different zip codes that we’ve already analyzed and ran projections on. So you can kind of sort that and see what is going to be projected the highest. So if you’re looking for a place to invest, that’s a great place to start. You’re also going to get our furnishing calculator. So if you want to know how much it’s going to cost to furnish your place, put in two beds, one bath, fire pit, grill, that kind of stuff.
[00:20:52.740] – Tony
Hit calculate, it’s going to give you a ballpark number so you can put that into your returns calculator. And then we also have a property grading tool. So you put in all this information based on the property yard size, how many people asleep does have a fire pit, that kind of stuff. And then you hit calculate and it will give you a letter grade. And that will help you kind of look at it from our perspective on whether we think it’s a buy or not. So all of our properties are actually a B. If it falls below the letter grade B, definitely second guess whether that’s going to be a property that you’re going to want to buy. So head over there, put your email list in. Looking to spam you’re just looking to add value. And until next time.