The Brad Weisman Show

Building a Profitable Airbnb Empire w/ Culin and Danielle Tate

March 28, 2024 Brad Weisman, Realtor
The Brad Weisman Show
Building a Profitable Airbnb Empire w/ Culin and Danielle Tate
Show Notes Transcript Chapter Markers

Discover the secrets to transforming a passion for property, into a profitable Airbnb empire with our esteemed authors, Culin and Danielle Tate.  This episode promises to unveil the Tate's extraordinary journey from humble beginnings to creating a diverse short-term rental portfolio, that thrives on strategic location and savvy marketing.  They don't just stop at sharing their story; they dive into the impacts of shifting rental demands and the rise of remote work, reshaping the landscape of weekday bookings. Their open approach in narrating their path by writing the book "Host Coach" and hosting a podcast is a masterclass in turning real estate investments into a fulfilling lifestyle.

Get ready to learn how to make your Airbnb listing irresistible, akin to the most captivating online dating profile you've ever swiped right on (well maybe)!  We'll explore the essential role of professional HDR photography and unique decor that sets your rental apart.  The Tates and I will also break down dynamic pricing strategies, with tools like Price Labs, to adjust to market demand and ensure your space is the go-to option, whatever the season or reason.  Focusing on a single platform, we highlight how to improve your search rankings and ensure your property stands out in the crowd. This episode is an investment in knowledge for anyone serious about maximizing their Airbnb's potential and turning it from a hobby into a high-performing asset!
"If you are thinking of getting into the Short Term rental game... get the book Host Coach by Culin and Danielle Tate" - Brad Weisman

#hostcoach #bradweisman #airbnb #shorttermrental #culinanddanielletate #realestateinvesting

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Welcome to The Brad Weisman Show (formerly known as Real Estate and YOU), where we dive into the world of real estate, real life, and everything in between with your host, Brad Weisman! 🎙️ Join us for candid conversations, laughter, and a fresh take on the real world. Get ready to explore the ups and downs of life with a side of humor. From property to personality, we've got it all covered. Tune in, laugh along, and let's get real! 🏡🌟 #TheBradWeismanShow #RealEstateRealLife #realestateandyou

Credits - The music for my podcast was written and performed by Jeff Miller.

Speaker 1:

From real estate to real life and everything in between the Brad Wiseman Show and now your host, brad Wiseman.

Speaker 2:

Hello, how are you doing out there? Thanks for joining me here at Thursday 7 pm. That's great. We have an awesome guest here. We had a guest on before that talked about Airbnb and we talked about short-term rentals and things like that. We didn't get too much into the nitty gritty, we just kind of touched the surface a little bit. So I have this couple married couple that are doing the Airbnb thing. They wrote a book, it's called Host Coach, and they also have a yeah, the same thing I'm doing podcast. Host Coach Show is what it's called. That's a tough thing to say, actually, very quickly, it's Colin and Danielle Tate and they are with me right now and I look forward to talking to them. How are you guys doing? Awesome, excellent, awesome, very, very good. I like your neon behind you, thank you.

Speaker 1:

Thank you, it was a Christmas gift.

Speaker 2:

It was a Christmas gift to each other, or did somebody get it for you?

Speaker 1:

I think I got it for Colin and then, because I bought it, we had to get our podcast going.

Speaker 2:

So wait a minute. So it was the neon first, then the show. Yes, oh, that's hilarious, because I have a neon in here that you can't see, but it was the show first and then the neon. Okay, so how did you get into the Airbnb space? You don't come out of high school going okay, or college saying this is what I want to do, I want to be an Airbnb master. How did this happen?

Speaker 3:

Yeah, we had in 2018, I was in a career crossroads. I had worked for a startup that sort of sold and was really wondering what to do, how, how, what was my next maneuver going to be? You know, did I want to start another company? And, you know, my son was nine or 10 at the time and you know, all of that overhead of starting another company seemed pretty daunting, and I had two properties that were Airbnb rentals one in Turks and Caicos and one that was a cabin and I realized that that could scale. And so the summer of 2018, I ended up purchasing one off market, one on market and one property from a wholesaler all in the same summer. Super smart.

Speaker 2:

Yeah.

Speaker 3:

And then, you know, with a small portfolio there, with the three, three new ones plus the two, I was quickly able to test and scale various processes, technologies, worked through all the different softwares and really was able to hone the craft. That's amazing.

Speaker 2:

So you started pretty quick, then you ramped up pretty quickly.

Speaker 3:

Then it seems yeah, we had had the experience with the first two under our belt and then that three in that summer just kind of happened that way, because there was the on market and then that person had an off market and then there was a wholesaler. I more like country type locations. Now what is that?

Speaker 2:

something that you just feel that works? Is this something that you just like to go to and that becomes the reason that you do it?

Speaker 1:

So we found that outside of any major city, between an hour to three hours out, there's got to be somewhere that people like to go for the weekend. Whether it's mountains, wineries, lakes, national parks, there's an area that city dwellers enjoy going to. And so finding a property, an investment property, in that space allows you to have the highest return on your investment, because those homes are typically priced more, like weekend getaways and you can repurpose them as high volume Airbnbs.

Speaker 2:

Interesting, Very interesting. So basically, there's cause. What I saw, the only thing that really was um, you know, a little different was the Turks and Caicos.

Speaker 3:

Right, and you know that's a beach property and it's more of a lifestyle type of property in that it rents very well. Yeah, it generates probably grosses close to a hundred thousand dollars every year, but the cashflow is zero.

Speaker 1:

Right, it's on a 15 year mortgage. It will be paid off when our son starts college, which was intentional. But everyone wants a beach house and beach houses are amazing. But if you're looking for cashflow out of an investment, we tend to scale, send people more towards the woods.

Speaker 2:

Towards the woods, interesting. See, now, I wouldn't think that, cause, you know, the the the whole shore point thing seems to be like, ah, well it's, you know it is, it's more sexy, whereas the woods are kind of like, eh, you know, but but that's like you said, outside the big cities they're looking for that. Look at the Poconos. I mean, you know, that became a huge, huge thing for people from New York City, especially after 9-11 and especially after COVID. These things have really, you must, have seen a huge increase after COVID or during COVID.

Speaker 3:

Yes, absolutely so. During and after COVID it started to settle down now here and is resuming, you know, sort of more normalcy. But COVID has changed. You know, the cat's out of the bag. People work from home and they realize they don't have to work from their home. Um, so you know there's a lot of new demand of during the weekday uh, not just weekends.

Speaker 2:

Yeah, amazing. So here's a question. Now, you do all this, why? Why the book, like what made you go? You know what we're doing this and it's really working well for us. We want to share it. We want to share this idea.

Speaker 3:

I'm bad at keeping secrets.

Speaker 2:

That's funny, so is my mom actually.

Speaker 3:

So what happened really is friends and family started to notice our being successful with Airbnb and, you know, inquiring about the numbers, really seeing the joy that it was bringing us, and began sort of informally coaching friends and family. And then a very dear friend of ours is a Keller Williams in operations in Wilmington, North Carolina, Okay, and and introduced me to their OP and the OP down there is a great guy and a big investor and had a call with him and he said you got to bring this to my market center, you got to teach my agents, you know these, these skills, you know for their own wealth building, and, and, and for their clients benefit.

Speaker 3:

And so I had to find it, formalize my thoughts into that presentation. Um, and then that presentation really became the outline for the book.

Speaker 2:

Yeah, it's amazing, that's cool and and, and we are going to get into those. You, you, you kind of gave us a little secret there the four pillars, the four pillars of basically doing the Airbnb process right, and you have that in the book and we're going to go over those. I wanted to actually bring those up. So it's the four pillars of Airbnb investing success. You have down here finding your where, pinpointing your ideal investing location. What do you use for that? Do you have a here? Finding your where, pinpointing your ideal investing location, what? What do you use for that? Do you have it? You have a tool.

Speaker 3:

It says an online tool or something that you use yeah, it starts with a bit of finding your why, you know. Find your. Where's a little bit of where do you enjoy, you know. Do you like to mountain bike? Do you like to, you know, go to the ocean? Do you like to go to? You know what do? What are you interested in? You mentioned the Poconos, and then from there we can analyze that market with a great tool called AirDNA. It's free, it's an online service. There's a paid version, but it grades each market Wow, things like investability, seasonality, revenue growth. It provides a great map. You could plug in an area and it scores each sort of county and so you can real quickly identify. You've mentioned the Poconos. Is that a high scoring place? And if it is, then you can begin, you know, your individual property search in that market, knowing that the market itself is strong.

Speaker 2:

Yeah, yeah. Now, when you pinpoint a place, danielle, when you, when you're looking at a place, do you guys find any pushback from the townships and the and the boroughs and all that stuff?

Speaker 1:

We've been incredibly fortunate in. The counties that we invest in are very short term rental friendly. They've been traditional cabin rental markets and so, while there is a hospitality tax by the county, they are used to having people coming because they want to be by the Shenandoah River, they want to be by the National Park, and so this has really not been an issue. I have fallen in love with a few properties that had HOA restrictions, and so that's something, listeners, if you find a house, double check with the agent to make sure that there are HOA laws that are friendly to short-term rentals, because you don't want to buy something that you can't use for the purpose you intend.

Speaker 2:

Yeah, and that's interesting because you know, you have your, you have your governmental, you know regulations with your townships, boroughs, your cities, you know. But the other thing that people do forget are the HOAs, and they have just as much power as the smaller governments do and they can definitely stop you from doing what you want to do. And if you bought a property and couldn't rent it, then that would be a little bit of a situation, A little bit. Have you run into anything like that?

Speaker 1:

Well, other than Daniel's mentioned that, uh, you know, there was a particular area that we kept seeing, properties around the lake places great prices, just kept popping up no way now I just know, when I see it, I immediately scroll to see what, um, what community yeah, community is and I'm just like no can't do it.

Speaker 2:

Oh, that stinks, and they and you know we're starting to go into that now, just in our area, here, locally, we're seeing in the newspaper and in the news sources that it'll say you know why? Missingboro has now started a new policy for short term rentals and now they have taxes and they have fees and they have inspections and all this stuff. So yeah, like you said before, the cat is kind of out of the bag and now the government entities are starting to regulate, which is fine. I don't mind if they regulate it a little bit in order to protect values of properties around there, but I think also, people need to make a living too, and I think it's a great source. I mean, airbnb is.

Speaker 2:

To me, the short-term rental thing is just incredible. We don't have enough hotels and things like that around in order to for people to go to go on vacation. So so, going on to the next pillar, make your uh listing pop. Now you're saying we use paint, decor, hdr photography, which is what we use, uh, for taking pictures for listings. Um, but you want the listing to stand out and I I can't agree with that more.

Speaker 1:

Absolutely so. I like to think of Airbnb's platform a little bit like an online dating platform. So if you're online and looking to meet someone, you're not going to take a picture of yourself in your pajamas with your hair all messy. You're going to have a great picture and a great outfit that shows who you are, and Airbnb listings are the same way.

Speaker 2:

Yeah.

Speaker 1:

As potential guests are scrolling through. I mean, how many times do you scroll past the first page of Google search? It's the same for the Airbnb platform. So having an accent wall, or I'm a big fan of blue velvet couches, hanging basket chairs, having things that guests are like, ooh, I really want to be there. I can imagine myself sitting in front of that fireplace or, you know, on that front porch making your listing pop to grab that initial attention and have people click further, get you much closer to being fully occupied.

Speaker 2:

You know, as you say that I'm thinking. Nobody wants to stay somewhere that looks worse than the house they live in.

Speaker 1:

Exactly. Nobody wants to enjoy using the clutter and beige couches.

Speaker 2:

Yes, exactly we want to see. We want something that we don't have.

Speaker 1:

you know, we always want to have something we don't have Experience and the dream like what's it going to be like when I stay there? And so your pictures and having HDR that just jump out really grab people's attention.

Speaker 2:

Absolutely I agree with that. So then it says price for occupancy. This was interesting to me implement dynamic pricing with the goal of 90% occupancy. I mean 90% is really. I think that's pretty good right. I mean, yeah, it seems good. So you're you're saying you price it for that. So you, you work all your numbers based on 90%, or do you go a little bit more conservative than that?

Speaker 3:

I actually managed the portfolio to 95% occupancy. Wow, right, so it you know. If there's one thing that people can take away from today's show is, if you're considering an Airbnb investment or if you have one, look into a third party dynamic pricing tool. Ok, we use this called Price Labs. There's others. They all work sort of the same way and the tool is connected directly into Airbnb and knows for your neighborhood what the demand is going to be on any given day. So our search is up 200% because Taylor Swift concert is coming into town.

Speaker 2:

Oh interesting.

Speaker 1:

Yes, or there's a college graduation yes, college graduation is a great one.

Speaker 3:

So the pricing software adjusts your price from a base price. Say, you have a $200 base price but there's an event coming into town that weekend and demand is up you know 300%. It'll take that $200 price and make it say $300 or $400 for the night. So this is called revenue management. Most hosts set it and forget it. They pick a price $200 a night and what that tends to do is underprice their weekends and overprice the weekdays so that there's they're vacant. So we're trying to find the demand. It's kind of like in real estate we're trying to meet the market on every given night. So next Tuesday night in the middle of the winter, here might be, you know, $100 a night at a cabin, gotcha.

Speaker 3:

But, Memorial Day weekend it's going to be, you know, $600 a night. So that's dynamic pricing is how we price each and every night to fill the property, because we can only make money when it's full.

Speaker 2:

So that price is constantly kind of moving. Then it's a moving depending on if there's a you know the new camping, you know exhibit that's going on, or something that's happening in the town, or you know whatever be a parade or something. It's constantly changing.

Speaker 1:

Just like airlines and hotels have been doing for years.

Speaker 2:

Absolutely.

Speaker 1:

And the tool we use is called Price Labs.

Speaker 2:

Okay, price Labs, and that's what he had said. Yeah, okay. So now this is the other thing. There's other short-term rental companies to rent from or go through. You've chosen Airbnb. Right, that's who you're using, correct, and there's a reason for that.

Speaker 3:

Well, there's two parts to that reason. The first is that we're a big proponent of sole platform. You'll hear people say why wouldn't you list in multiple different places if you can do it for free, right?

Speaker 2:

We can list on.

Speaker 3:

Airbnb for free. We can list on VRBO for free, but I liken it to running an ad in the newspaper. If you are listed for free on three different platforms, you're not going to perform particularly well on any one Because think about it the platform wants your review, it wants your business. They only make money when you book. So if you're blocked half the time on platform A and half the time on platform B, you end up now down on page 59 of the newspaper, instead of striving for being on page one of one newspaper.

Speaker 2:

Gotcha, that makes sense. Yeah, so you commit, and then you commit, and then they commit. Basically, for what you're doing. Yeah, that makes a lot of sense. So we have another one here Optimize the rank. Use our knowledge of the Airbnb algorithm to ensure you stay highly booked. So there's obviously some tips on how to stay highly booked.

Speaker 1:

Basically, the Airbnb platform is a search engine like Google, and there are certain criteria that it uses to show listings in a high place or show listings on a lower page, and so what will happen is a lot of hosts will start out and things are going great and then, all of a sudden, a couple months in bookings slow down and they just. Don't know why. Nothing's changed. Their photos haven't changed, their prices haven't changed, but all of a sudden they're not doing well and what's happened is Airbnb gives new listings a boost.

Speaker 1:

At the beginning they show you more frequently to see if you're going to book or not. If you book, they keep you know, putting you up front. If you don't, you start to slide down. And so I'm a big fan of you know what gets measured, gets done, and so we use a tool called RankBreeze, and what it does is it shows the rank of your property across all these different days and metrics. So you see, oh my gosh, I'm on page 42, or oh.

Speaker 1:

I'm actually I'm killing it. I'm on page one and so by measuring that and knowing where you are, if you are having a problem, you can be like oh, why don't I change a few of my policies? Maybe I need to reorder my photos. There's all these different things you can do. Perhaps you need to be pet friendly. There's all these things you can do and then wait and let the algorithm absorb those changes, measure it and go back to RankReach to see where you are, because that's so funny.

Speaker 1:

None of us scroll past page one in Google and Airbnb. No one looks past 18 listings. I believe is the metric.

Speaker 3:

Wow 18 on the first page. The average guest looks about four listings before they book.

Speaker 2:

Well, yeah, well, if you see something you like, you figure why should I go any further, right? I mean, that's kind of how it works for Google. If I get the information I want, I'm not going any further unless I'm looking for something specific you know in in in that. But that's really interesting. So basically and it sounds a lot like believe it or not, it sounds a lot like selling real estate we a lot of times, if a listing is getting a little stale or it's, you know, sitting on the market for a little bit more time, we'll change the first photo, we'll change something in there or change the price with us sometimes, you know.

Speaker 1:

But it's very interesting.

Speaker 2:

Yeah, exactly Cause that that makes it. Now the algorithms hit that and go oops, something changed. We got to put it to the top, you know. So it makes a lot of sense. Is there anything else that you can think of besides those pillars that would that would be something that we should be thinking about if we are interested in doing this. Is this for everybody? Is this like a lot of times we say you know, do you want to be a landlord? Is this the same as being a landlord, or is it a little different?

Speaker 1:

I would say this is different. We have been long-term rental landlords and have never had the best experience chasing people for rent and when they move out redoing everything. I really enjoy being an Airbnb host and managing 10 properties. I love talking to guests, I think because we automate the mundane messaging. I get the. It's my mom's birthday. Where should we go to dinner? I'm proposing, Is there a place where we could take great photos? And so I get so much more joy and we reap so much more revenue from short-term rentals. Yeah, yeah.

Speaker 3:

You're in the hospitality business, and so you can either gravitate towards that, you know which I think a lot of us do or, if you're excited about this and you kind of gravitate towards the financial side but not the hospitality side, partner up with somebody else out there, right?

Speaker 2:

That likes the hospitality side right. Exactly who fixes stuff when it breaks.

Speaker 1:

Handy. My dad's an engineer. Handy was at the top handsome and handy were at the top of my husband list and so this guy is uh, but as we've, as we've grown that's funny, we do have boots on the ground.

Speaker 3:

Yeah, teams, that's a big part of it too. Maybe something else to add um is, your team is team is is key. So it starts with your housekeeper. Your housekeeper has to do an excellent job to get you those five-star cleaning reviews. And then from there, you know it's nice to have, uh, someone who you can call to, you know, fix the small things, so I don't have to drive down there, you know, to fix everything. And so we've set ourselves up with a good team. Team members like that.

Speaker 1:

And, yeah, we give those team members autonomy, like our housekeepers are fully authorized to be like. This is broken, we need a new one. This isn't working. You know we should really think about blank, and so we really consider them a partner in the business, which is not always everyone's mentality, but it makes all the difference. They're there every two to three days. They see everything and so if they feel like they're a partner and able to tell you things and suggest things, only good things come from that.

Speaker 2:

That's amazing, that's cool, so there, so it's like anything you delegate, but you have to trust the people you're delegating to and make sure that they're on the same level as you are as far as professionalism and cleanliness Cause I'll tell you, there's nothing like getting into a place that you got to clean before you can even sleep in the bed. You know that that's always discouraging, very discouraging, yeah. So where can we find you? Where can we get help from you guys? I mean, if somebody's interested in doing something you know, like what you're doing, what's the best way to contact you?

Speaker 1:

So listen to the Host Coach Show, which is our podcast. We have episodes every Tuesday. You can find us at hostcoachco. Whether you want to read our blog, whether you want to do a 30 minute, you know, call with us just to explore wherever you're at in your Airbnb journey. But we're we're everywhere and always happy to talk and help people. That's what brings us joy.

Speaker 2:

Awesome and I think when I looked up, when I just Googled the host coach, I think it came up. You guys came up, if I'm not mistaken. It was pretty easy to find.

Speaker 1:

I would hope so yeah.

Speaker 2:

Yeah, Awesome. Well, thanks so much for coming on today. And and where can we pick up the book? Amazon, of course, right.

Speaker 1:

It's on Kindle, it's a paper back and you can also listen on audible.

Speaker 2:

Oh, awesome, so it's everywhere. I'm going to actually check it out on audible. I'm not a really fast reader, so I'm going to check it out on audible cause I listened to my books. But this is great, man. Thanks for coming out today. Thanks for being on the podcast. I really appreciate it. Best of luck with the book and all the stuff you're doing. I might be in touch about the Turks and Caicos. It's very impossible that could happen, because that's somewhere we want to go. So thanks so much. Have a great day, guys. Thanks, thank you All. Right, there we have it. You got to go pick up this book. Go on Amazon, pick up this book.

Speaker 2:

If you have any interest into an Airbnb, you want to take a look at this. They are definitely spelling out all the ways, all the things that come into the four pillars of Airbnb investing success. This dug real deep. It got detailed and I'm glad we did, because a lot of people have questions. So come back and see us every Thursday at 7 pm and we'll have more great guests, just like them. All right, that's it. We'll see you next Thursday.

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