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[00:00:00] Sarah: Hello, listeners. Welcome back for another great episode. My name is Sarah Karakaian.
[00:00:04] Annette: I am Annette Grant. And together we’re–
[00:00:06] Both Annette & Sarah: Thanks for Visiting.
[00:00:08] Sarah: Let’s kick off this episode like we do every week, and that’s sharing one of you, our amazing listeners, who is using our hashtag on Instagram, #STRShareSunday. We’ll share you here on the podcast like we’re about to do in just a moment, share to our entire email list, also on our Instagram channel on Sunday. Get it? Annette, who are we sharing this week?
[00:00:27] Annette: This week we are sharing @eclipse_poconos. Again, that’s @eclipse_poconos. And the first thing I saw when I went to this A-frame, it is so cool. They have eclipsed it.
[00:00:44] Sarah: They have.
[00:00:45] Annette: I’ve never seen this before. You have to go to the Instagram and check it out, you guys. It is an LED. They’ve framed their A-frame in LED lights, so it’s almost as if the A-frame has been eclipsed, and it is gorgeous. And it is a new A-frame, so I love that. That was obviously a part of the construction process, but it is stunning in photos. It’s a showstopper. You’re like, oh, that’s so cool. It’s glowing, and then the Eclipse Poconos. Just really well done there. And they just opened their doors to guests.
[00:01:26] Sarah: Let’s show them how amazing the hosting community is, everyone.
[00:01:30] Annette: Go give them some follows. Give them some love. Let them get so many hearts on their new Instagram feed. Let’s help them out. And I’m telling you, the LED light really is special. And then they have some photos too of sitting there in the hot tub. The hot tub lights change. They have some outdoor bistro lights.
[00:01:52] But what I also love that they are encouraging is taking a look at the calendar. And if there is a full moon, they are like, please turn off all the lights. That way, you really can embrace, enjoy, and get a full view of the full moon. Thought that was so cool. It’s something that I haven’t seen before, and it’s really going to give their guests there and experience. So well done, Eclipse. And everyone, go give them some likes. If you’re going to the Poconos, book with them, and then thank you for using hashtag. Who’s going to be next?
[00:02:35] Sarah: I know we’re–
[00:02:35] Annette: Who’s to be next?
[00:02:36] Sarah: We’re a part of people’s onboarding process now. Okay, acquire property, furnish it, share the hashtag on Instagram so TFV can share me.
[00:02:45] Annette: Listen to the podcast.
[00:02:45] Sarah: Listen to the podcast. Leave us a review.
[00:02:49] Annette: All the things.
[00:02:50] Sarah: All things, yes. Today’s a fun, I don’t know, is this the one after we did with Bill Allen. We’re doing two of these? We did little side interviews at TFV Con 2023. If you missed our conference in 2023, don’t worry. We are planning to do again in 2025, but you do have to wait a whole year. Good things come to those who wait. We pulled Kenny Bedwell aside because, listeners– okay.
[00:03:17] Kenny was a sponsor of the conference, and he was supposed to have this little side room where everyone attended maybe one session with Kenny to learn more about short-term rental data that’s been going on in different marketplaces. Annette, please share with the awesome listeners what happened?
[00:03:37] Annette: Well, we got such an overwhelming response when we first announced it that we had to switch rooms before the event even started. Luckily, the hotel that we worked with was awesome. We moved it into a larger conference room. It was still standing room only you will hear in this interview.
[00:03:58] Our guests wanted to attend every single session, and by the end of the event, we actually just transitioned one of his sessions into the main stage. And we were happy to do that because, number one, we are hosts, so when our guests ask for things, we want to try to accommodate always.
[00:04:19] And two, we were just overwhelmed with all of the guests wanting to dig into their numbers, not only in their current location, what could they do, what amenity could they add to their property that would actually move the needle though on profit, not just adding an amenity to add an amenity.
[00:04:38] Kenny did some really cool, not games, but just bringing it to our audience of like, hey, do you think this hot tub would actually bring this home more bookings and more revenue? Will this game room matter? And it was really cool to actually let the data dictate, not our feelings.
[00:04:59] So Kenny was such a huge success, what he was offering there. So yeah, he was on the main stage by the second day, the last session. We brought him on stage, and it was a full house still.
[00:05:10] Sarah: Dare say, he stole the show as much as I don’t–
[00:05:13] Annette: Yeah, it’s okay.
[00:05:14] Sarah: He did. And we love Kenny so much. So this interview is chockfull of really great information, especially with today’s marketplace. We’re still in the same situation where interest rates are a bit higher. The short-term rental market isn’t as easy to decipher finding cash-flowing properties.
[00:05:32] Kenny’s opinion, if it’s not cash flowing today, it’s not worth looking into it further. Whether you agree with that or not, here is Kenny talking about short-term rentals and what we need to be thinking about as we’re analyzing deals here in 2024.
[00:05:49] All right, Kenny, we are excited that you are here at TFV Con.
[00:05:52] Kenny: Me too.
[00:05:54] Sarah: First of all, standing room only at Kenny’s workshop.
[00:05:57] Annette: Not just standing room only. I think people are like getting angry. I’m just going to say it. They want all the knowledge. They were supposed to go to one session.
[00:06:09] Sarah: They’re going to all of them.
[00:06:11] Annette: They’re going to single one, but that’s an amazing message because that means that hosts are leveling up. They know they need to know their numbers before they purchase, or they know they need to really assess their investment now and how they can improve it.
[00:06:26] But Kenny, let’s talk about what are three big mistakes that you see people making right now when they’re looking for deals?
[00:06:33] Kenny: Yeah, so the first mistake is the common thing. You only know what you know. So typically when hosts are either looking for their second investment or even their first one, especially rookies, they go to markets where everybody else is. They’re chasing. I call it chasing.
[00:06:49] So all the big popular markets that we know, the Smokies, Florida, maybe even Tahoe out West and Scottsdale, everyone wants to go there. Everybody wants to invest in this and live the dream that all these other people done. And they’re going there and chasing that.
[00:07:04] And a lot of them are investing in bad deals that just don’t pencil out. And it’s just a waterfall. And unfortunately, I’ve been having a lot of calls with individuals who are struggling because they’re losing money. They’re not even breaking even.
[00:07:19] Annette: I want to ask though, you just said deals that don’t pencil out. Is it they don’t pencil out today or they will never pencil out? And I know that’s a loaded question, but do you think people are thinking the market is going to change or improve, or their listing’s going to be better. Do they already know it’s not going to pencil out when they go into it?
[00:07:44] Kenny: I think a lot of people make the mistake of not understanding all the expenses. So it’s really cool to say, oh yeah, you’re going to make a $100,000 on this property. And people who know nothing about short-term rentals and all the expenses, they just, oh, $100,000? Yeah, I’m going to do this. But at the end of the day, on average, you probably only profit about 25 to 30% of that.
[00:08:05] And that’s if you profit, because if that’s, say, a million-dollar deal, or over a million, we’ll say you might just be breaking even or make no money at all. It’s really, really important. So I guess to answer your question, though, I don’t have a crystal ball, and I never make investments just for the future. I make investments for today. So if it doesn’t cash flow today, if it doesn’t make sense on the numbers today, then it’s definitely not going to make sense for me for the future
[00:08:31] Annette: Boom. Okay. That’s a takeaway right there. For you personally, it needs to make sense today.
[00:08:36] Kenny: Exactly.
[00:08:37] Sarah: Okay. So people chasing a market is mistake number one. What’s another mistake people are making?
[00:08:41] Kenny: I think another mistake people are making too is they’re not doing enough due diligence on the regulation side. So we saw 15,000 short-term rentals or Airbnbs wiped out in New York City, 15,000. And there’s other cities across the country who are also watching and taking note of this, and it’s going to be scary.
[00:09:03] And so a lot of hosts are just going into areas trying to invest without understanding the community sentiment, that’s the key word there, community sentiment towards short-term rentals in that area, whether it’s cities, whether it’s other towns, or wherever. We’ve really got to know how people feel about short-term rentals, not just what the current regulation is because it can change.
[00:09:24] Annette: So we’ve got chasing, you’ve got due diligence, and we’ve lost my voice. You’re literally taking my breath away, Kenny, with these mistakes.
[00:09:34] Kenny: Yes.
[00:09:34] Annette: All right, the third one. Let’s go to the next.
[00:09:36] Kenny: Okay. Yeah. I’ve got two competing in my mind. Maybe I’ll throw a bonus one out there.
[00:09:41] Annette: Ooh, a bonus.
[00:09:42] Sarah: We like bonuses.
[00:09:42] Annette: I don’t like bonuses.
[00:09:43] Sarah: And more. And more.
[00:09:45] Kenny: Bonus mistakes. Yeah, bonus mistakes.
[00:09:46] Annette: No, bring them on.
[00:09:49] Kenny: The biggest one that people really– it’s not the sexiest thing to say, but it goes back to running the numbers. People just don’t run numbers appropriately. And what I mean by that is they’re looking at a set revenue. So when someone comes to me and say, Kenny, how much can this place make? I always tell them a range. Because in a good, better, best scenario, things happen. We might see dip in occupancy.
[00:10:11] Well, how does that impact the end result of your returns at the end of the day? What type of risks are you taking if you only have, say, 50% occupancy instead of 60%? So a lot of people aren’t doing that, and that’s really– they’re already writing the line and hoping for the best case. And when they don’t hit it, they’re like, what happened? But it’s like, did you look at the range there?
[00:10:33] Annette: Ooh. Okay. So chasing, due diligence, good, better, best. All right.
[00:10:38] Kenny: Yeah, that what I call it, good, better, best modeling.
[00:10:40] Annette: What’s the bonus?
[00:10:42] Sarah: What’s the bonus?
[00:10:43] Kenny: What’s the bonus? I think another one too is just going back to when we are running our numbers and using the right data. So instead of a lot of people using free calculators or free online data tools and things to try to base hundreds of thousands or millions of dollar decision, instead of investing in more data or comparing different sites together to get an answer, a lot of people are just looking for the quick, easy run.
[00:11:13] And I ask them all the time, why did you think it was going to make this? Oh, I plugged it into this and it said that. And I’m like, it doesn’t work like that. You’ve got to look at true comparables. You’ve got to really measure those things out and look at the other properties and see what they’re doing.
[00:11:26] Annette: Let’s wrap this up on a positive note. What is something that you’re excited about in short-term rentals or you see hosts are making great decisions? What are some of the shiny, happy moments?
[00:11:38] Kenny: Yeah, some of the happy moments, there are a ton of great emerging markets going on right now. So there’s a lot of new growth going on, whether it’s amusement parks, theme parks, ski resorts, new national parks, and just a lot of attention. People are, in my opinion, traveling a lot more. Airbnb isn’t going anywhere. There’s no Airbn bust.
[00:12:03] There’s always going to be travelers. There are tons of hosts who are doing better year over year. People are doing great. It’s just the people who need to adjust or have the wrong property in the wrong location that maybe need to either sell or get rid of it or move on. But there are a ton of people doing well, and there’s a ton of markets doing well as well, so yeah.
[00:12:21] Annette: Emerging markets. Actually at our conference, I just learned– I didn’t know they were creating new national parks.
[00:12:28] Sarah: National parks. Yeah.
[00:12:28] Annette: And someone here has their property that just got awarded, I guess, a national park. Oh my gosh. That’s a badge of honor, to visit all of them. Can you imagine the surge of people going to that new national park? I was like, oh, that’s– I just didn’t know that was a thing you could still– they were, not making more, but awarding a park as a national park. Kenny, let’s talk about STR Insights really quick, though. What the best way for someone to– I say STR Insights, everybody laughs, but it’s not a laughing matter.
[00:12:59] Kenny: Yeah, no, I was like, where did I come from?
[00:13:01] Annette: What is the best way for someone to work with STR Insights?
[00:13:04] Kenny: Yeah. So they just go to our site, and they can either schedule a call or sign up for our software. But we also do consultations because people have a lot of questions. They, beyond signing up for a software, have a call with us. Ask us, hey, how do I evaluate a property? How do I find a market? These calls are free, and we love helping people get to the outcome, which is finding a good deal.
[00:13:25] Sarah: And something important that I ask Kenny about, because when you are finding property, there’s an opportunity that comes your way, you need to know fast sometimes, especially in a lot of markets these days. But you know that. You get that, and so can reach out to you and say, hey, I’ve got a deal. I got to decide soon. Can you help me figure this out?
[00:13:39] Kenny: Yeah, absolutely. All the time. I got a text message this morning. Can you go through it? All right.
[00:13:46] Annette: Open up.
[00:13:46] Sarah: That’s incredible. Kenny, thank you so much for joining us at TFV Con and for sharing all your wisdom.
[00:13:50] Kenny: Great. Thanks, guys. Thanks for having me.
[00:13:52] Sarah: What’d you think, Annette?
[00:13:53] Annette: I loved it. I especially love when I lost my voice. It was a good one.
[00:13:57] Sarah: We were talking a lot.
[00:14:00] Annette: It was great. It’s fun to go back to this, but there are two things that stuck out, and I think it’s for all investors, current host, future host. The community sentiment, I really appreciated his terminology there. I’m thinking that I want to start using that when I’m chatting with people about where they want to buy, is understanding that community sentiment.
[00:14:22] He was brought up New York City. We just did an interview with New York City hosts. Again, Sarah and I met at a city council meeting where they were bringing in regulations. And so familiarize yourself with that community sentiment. Please look at our friends. Please join anything that they have at Rent Responsibly. Do that today. Or put it on your list of things to do, but please connect with Rent Responsibly, get on their newsletters and take action in your community. And then the third thing that I just really took to heart was his good, better, best.
[00:14:56] Sarah: Modeling. Yeah.
[00:14:57] Annette: Yeah, the modeling of– it makes me want to do it. Actually today, Sarah, with our property, is like, okay, what is good, better, or best? And let’s run the numbers on these three different scenarios. I know you and I talk– we talk about our modeling, which is long-term, midterm, short-term, and having three different options for a property. So I want to add I love that we already have that, and I want to add in the good, better, best, and all three of those too, looking at properties.
[00:15:27] Sarah: What I also think about with Kenny too is what you have to remember, is there– sometimes I get so stuck, Annette. What I know best about short-term rentals are metro markets. So we have the luxury of doing long-term rental, midterm, short-term, and selling.
[00:15:39] There are some properties that really– I don’t know if you’d ever long-term rent them. You might be able to midterm rent with people traveling the way they’re today, but with the modeling, good, better, best, what Kenny is talking about is when we aggregate information from– let’s just say who they are– PriceLabs, AirDNA– there’s another one– Key Data, to get information from all three of those, do you have to pay for it? Yes. Is it worth it?
[00:16:04] Both Annette & Sarah: Yes.
[00:16:05] Sarah: If you’re going to spend these hundreds of thousands of dollars on this property and all the time and investment, you should absolutely be investing funds and getting the right data to make sure that your analysis is complete and really tells you the whole story because you don’t want to get in there, like Kenny said, a year later, and be like, what happened?
[00:16:22] You know exactly what happened because you have your good, better best modeling. Hopefully, at least good happened because all three of those data points that you aggregated from online are telling you that, yes, you’ll at least end here. It’s worth doing the deal.
[00:16:37] Annette: We’ve already seen in the new reports from 2024 that small cities in rural areas are exceeding the normal pace. That’s where all of the AirDNA, PriceLabs, all of them are saying, hey, the opportunity is here. It’s no longer in the metro markets. It’s in these smaller cities, these rural towns. That’s where we want to be looking. And I think that goes back to– that whole bringing on new national parks, I think it was such a great–
[00:17:10] Sarah: I forgot that. We should look into that.
[00:17:12] Annette: Oh my gosh, what a way to get something ahead of the curve there. Because that is honestly something I really had no idea that they are still naming and awarding new national parks. I have people in my family that that’s their goal, is to get their– I think it’s a patch. They get a patch for every park that they go to.
[00:17:34] Sarah: With that, we will put STR Insights information in our show notes. Whether you click that link or you head right to their website, let them know you heard about them from Thanks for Visiting. We are huge fans of everything Kenny is doing over at STR Insights, and we want to let him know that we are singing his praises over here. With that, I am Sarah Karakaian.
[00:17:52] Annette: I am Annette Grant. And together we are–
[00:17:53] Both Annette & Sarah: Thanks for Visiting.
[00:17:54] Sarah: Talk to you next time.
