Where to Find Your First (Or Next) STR Unit

October 5th, 2020

There's no wrong time to start an STR business. I honestly and truly believe that. I don't care whether we're in the middle of a global pandemic and the economy has tanked, or we're in the middle of a boom and thriving economy.

The time to buy your first STR is Now O'clock.

I spend a lot of my time pouring over data in the hospitality and travel industry, and no, the numbers aren't super encouraging at first glance. But it's not all gloom and doom, either. (And if you've already started your STR business, the time to buy your next STR unit is Now O'clock.) there's nothing in this data to suggest, “Oh my God, don't start a short-term rental right now.” But there is information that says, “When you start your short-term rental, here's what you can expect, and here's where/how you need to expand.” The bottom line? People are ALWAYS going to need short-term housing. Period. End of story. As long as there are people, they will have this need. Those are the facts. So, let's talk about where and how to find your next STR unit so that you can fill that need. Here are some ideas:

#1 Find a landlord with a vacancy they want to fill quickly.

Many people don't realize that you don't need to buy your STR property upfront. You can lease it. And, in many cities around the country right now, there are a lot of places for rent or lease. You need to understand that landlords have a problem: vacancies. With every vacancy, they lose money every month. Someone asked me recently: “When negotiating for a property, do I tell the owner or landlord that I'm doing this as a short-term rental?” Sure. You don't need to (and shouldn't) hide what you plan on doing. The landlords could do what you're doing, but they don't want to. They're still going to profit from your STR. Your landlord is in the real estate business, and you're providing people with clean, affordable, short-term housing. When you're solving someone else's problem (the landlord's vacancy problem in this case), everything else takes care of itself.

#2 Find a place near a hot attraction.

When I say “hot attraction,” I'm not just talking about Disney World, the Grand Canyon, or some other big tourist hot spot. This can mean any place that many people are attracted to and visit, for whatever reason, throughout the year. And, in times like these, that “attraction” could be a hospital. It could be a vast construction site. It could be a conference center. It could be a university. It could be an airport. Keep your eyes and ears open for places where many people visit, congregate, and spend time over many months. They're going to need a place to stay, and you can be the one who provides that place for them.

#3 Find a place for people looking for a “rustic” experience.

When people ask me: “Will this building/address work as a short-term rental?” I tell them that the answer is probably yes. One of the biggest things to understand about the short-term rental game is that it's not about the piece of real estate. It's about the experience someone can have at your location. There are several different categories of knowledge: a family experience, an exotic/romantic experience, an urban experience, and one of the ones I see a lot of lately—a rustic experience. What do I mean by a pastoral experience? Well, it can look a lot of different ways, but basically, it's somewhere out in the middle of nowhere: in the woods, out in the countryside, in a desert, on a mountain. And the accommodations are the bare minimum. This is excellent news for you, the STR owner, because you can get started with a “rustic” unit for very little money. Your customer isn't expecting a whole lot. And, for some people, the more bare bones, the better.

You can set up a living room scenario with very little equipment to create the experience. Think glamping. Your customer's experience will be focused more on who they're with than where they are. This could be a family, a group of single adults, or a couple of retreats. People are there to connect, so you have a tiny start-up or maintenance cost. You're delivering something unique. Your customer will bring their comfort items (or not), and you won't be expected to provide much. Remember, they're going for “rustic.”

#4 Find a place that's outside of your geographic home area.

Many STR owners stick to properties close to home, at least in the beginning. And this does make sense. You'll need to be more hands-on until you're ready to start delegating all the daily, weekly, and monthly tasks to other people. But only looking for properties near where you live can be very limiting. There's a whole state, a whole country, with all possibilities. If you live in a place that's not known for being STR-friendly, you may want to expand your horizons. We're seeing more cities getting excited about STRs. They like Airbnb, and they like the additional tax revenue that comes from having STRs in their town. Find one of those cities and capitalize on that excitement and enthusiasm. Being location-independent is one of the biggest perks of being an STR owner.

The bottom line?

You must create an experience for your customer that generates a five-star review. My customers love my business. And I love this business and what it provides for me. All of us are here because we've had great ideas. You're in a store, something catches your eye, and you think, “I had that idea!” Take those great ideas and turn them into extraordinary experiences for your guests. This business works. Not because I say so but because humans need a place to stay. They always have, and they always will. You might have to attack it differently during these times we're living in, but the business still works. Are you willing to do what it takes to make it work for you?***If you'd like more invaluable information on getting started in STRs, grab our FREE STR Playbook here–no strings attached or email needed. It has everything you need to get you down the road to STR success.

Reply

or to participate.