5 BIG MISTAKES to Avoid with Airbnb Investing

Hey, what’s up guys, in today’s video, I’m going to be piggybacking on last week’s video or the last video I put out here on the channel where I covered three things you absolutely need to know in order to succeed with short term rentals. In this video, I’m gonna be sharing with you five biggest mistakes that I see people making when it comes to short term rental investing. So that hopefully you can avoid those and make sure you don’t fall into these common traps.

So the first one let’s dive right into it is I see a lot of people picking the wrong areas. Now this is something I addressed in the last video, but I see people making this mistake all the time. So I want to make sure it doesn’t get overlooked, I see people making the mistake of picking the wrong area to get started in. And oftentimes this happens when people already own a property that there used to be a primary residence, or maybe it used to be a long term rental and they’re thinking about converting it over to a short term rental. Now in some instances, that can be a total homerun it can be a really, really great play. But not all instances is that the case, in some cases, you’re just in a bad area for short term rental, maybe there’s regulations that are working against you. And so I also see people making the mistake of getting emotionally attached to an area that they want to own a property and, and they try to make it work. We saw Shelby church, a prominent YouTube influencer, who made this mistake herself, she invested in a market called Palm Springs, California where the regulations really weren’t in her favour. So I see people make this mistake all the time, big and small. And you just want to make sure that you really do your research on your neighbourhoods. So that’s mistake number one, you want to avoid that by just fully understanding the regulations and trusting the data and the information you have not getting emotionally attached to a reason that you want to buy in a particular area. Now, mistake number two that I see people make all the time is overpaying for properties, I cannot tell you the number of people recently over the last couple of years that have just been paying way too much for the properties that they’re investing in. Because there’s a buying frenzy because there’s a bidding war, or because they just are more emotionally attached to the property or because they’re being impatient. Whatever the reason, the most important thing to remember is that you are an investor, you’re buying this property in order to make a return on your investment. And you’re gonna be pouring your hard earned money and your time into this investment into this property. So you want to make sure that it actually yields a really solid return, I see too many people that are going in and just overpaying for the property and doing it in a way that ultimately, they’re going to have to put in a lot of work just to get back to break even. Because if they want to sell the property that have to do so at a loss, that’s just never a place you want to be in. So make sure you stay disciplined. Know the market, make sure you work with a realtor if you need to in order to understand these numbers and just never overpay for a property. The third big mistake that I see people making is just not knowing their numbers when it comes to how much the property will generate an income and will cost and expenses. I see people overlooking this are doing kind of back of the envelope math all too frequently. Again, it’s important to remember that you’re pouring 10s, if not hundreds of 1000s of your own hard earned dollars into this property into this investment. So you want to make sure you really know your numbers. It’s not enough to just do some light due diligence by checking other properties on Airbnb and guesstimating at what this property could do, you really want to have certainty before you just go and sort of YOLO your money into any property. Again, this is something that we’ve seen influencers like Shelby church doing just not really doing proper due diligence, not factoring in enough for expenses. And so you really want to make sure that you just do your homework ahead of time. So you can accurately project both the income and the expenses that you would expect for a given property. Again, this is something that you definitely can do, you don’t have to be a fortune teller, you just have to know where to look. And you have to put in the work. Those are the three first mistakes I see people making in order honestly, of how they make them. The fourth mistake that I see a lot of investors making when it comes to short term rental investing is honestly just under listing the property. And what I mean by that is that they launched the property and I see them make this mistake all the time is they do it hastily, and they don’t take the time to fully understand how to optimise their listing. Now this is a massive mistake, because whether they just hire a subpar photographer, or they don’t price the listing property properly, or maybe they just don’t take enough time to create a really captivating headline for the listing all this stuff means that even if they’ve done all the work that they should have done in their due diligence period, the property is still ultimately just going to underperform and they’re going to be leaving a lot of money on the table. The reason why making this mistake tends to sting so much is because when you make this mistake, there’s just such easy money that you’re leaving on the table that if you just made a few small tweaks, you wouldn’t have to spend any more money. You barely have to spend any more time and you could in some instances literally be grabbing hundreds or 1000s of dollars more in income per month or per year. So I highly recommend that anyone that’s looking to get started with short term rental investing, understand the algorithm, understand how these different platforms work, understand how to use a proper pricing strategy. And really, you know, a lot of the time that means working with someone like myself, coach who can walk you through that, if not checking out all the YouTube videos on a channel like this one is going to walk you through it step by step, whatever you have to do to become educated and make sure that you really can maximise on what you’ve already got, that is something that’s going to help you to produce way better returns with very little additional effort. Now, the fifth and final big mistake that I see a lot of investors making when it comes to short term rentals is they rely too heavily on themselves to manage the property ongoingly. Now, there are different options when it comes to managing your short term rental, you can outsource your management to a management company and in the right situations with the right property, that is a really great move, you can also manage the property yourself. But when you do that, I really don’t recommend actually doing it yourself, I recommend building your own what I call sort of internal management company. So depending on how many properties you have, that’s going to determine how robust and how large this internal property management company is going to be. At the very least, you need to have a really solid reliable cleaning team and some reliable maintenance. And as you grow, it’ll make a lot of sense to add in someone in the guest communication role. And ultimately, then into the portfolio management role to kind of oversee everything and coordinate everything so that you can be completely hands off. The big mistake I see people making here is that they stay way too involved for way too long. And it ends up meaning that they’re putting way too much energy and stress into the management of the property. And ultimately, they get so attached to the property that they end up making short sighted decisions. For example, I see people making this mistake all the time where a guest will give them bad reviews or be upset about something and they’ll go and bend over backwards to satisfy that guest because they take it so personally. Whereas when you’re more hands off, and you let your team manage that they can make a more analytical decision about these things and take the right actions that are going to benefit you the most long term. And then ultimately, because you’re not as stressed out managing the properties, you’re gonna have more bandwidth to go and expand and invest more and grow your portfolio. So whatever stage you’re at, you’re gonna really want to implement some strategies to take the management of the property off of your plate and really put systems in place so it can be much more passive. So those are the top five mistakes that I see investors making most commonly when it comes to short term rental investing. Let me know in the comments down below if there are others that you see happening all the time, or if there are others that you’ve avoided yourself as a short term rental investor. And again, if you’re new to the channel here if you haven’t yet subscribed, make sure you hit the subscribe button hit the like video, the like button as well to make sure I know that you liked this content and to help me reach more people with it. All that being said, thanks so much for watching. Hope you enjoyed the video and I’ll see you in the next one.