Investor Reacts – Shelby Church’s Airbnb Disaster

James Svetec 0:00
What’s up guys in today’s video, we’re gonna be reacting to a fellow YouTuber a much larger one than myself, named Shelby church. She has recently been putting out videos about the performance of her Airbnb and talking about Airbnb bust. She’s also done other videos related to the space of Airbnb talking about other properties and how they’re doing going and actually checking them out. And so this most recent video is titled how much my Airbnb bank made in its first year, this is going to be my first time ever watching this video. So I’m just going to give you my reaction and my thoughts. This is a property that she purchased in Palm Springs action, another video reacting to one of her other videos here on this channel. And so I know a little bit of background about the property. And I’ve actually since that video gone and done a bit more digging around and found more information on Palm Springs. And I know that Palm Springs with their regulations are not really great for short term rental for a few reasons. There’s a limited number of bookings actual short term rental bookings that you can bring in in any given year. And I’m familiar bit with the performance of this property and some things that she did that weren’t that great, and that were kind of beginner mistakes she made, she didn’t really know what she was doing when she first got into it. So really interesting to see how she actually did overall in the first year. Let’s go ahead and jump right into it.

Unknown Speaker 1:18
So I have an Airbnb in Palm Springs. And this is my first year of owning it like a lot of people during COVID I fell into the dream of having passive income from a rental property. But then everyone turned on Airbnb and it turned into a nightmare. No, I’m just kidding. But it definitely did change things quite a bit. I decided to document and share the honest truth of what it’s like having an Airbnb in 2022. At the time, it seemed like an amazing idea. Until the public discourse around Airbnb drastically changed halfway through the year, it seems like my bookings screeched to a halt, and I knew was going to be really close whether or not we actually made money this year, we’re finally at the one year mark, and I can share with you guys how much we really made, how much all costs. And if it was even worth it. If you appreciate me sharing my honest experience, please give this video a like and consider subscribing by hitting the button below. Alright, I’m gonna start by telling you guys exactly how much we made in the first year. So first, I want to thank Dell for sponsoring this video. This is their new Dell Latitude 93.4 on sustainable, and actually, it’s called an IQ consume, this will automatically pop up and it makes a screen share, but you’re really gonna 30. So I got all the numbers together. And in total, we made $81,861. And that includes what people pay it to heat the pool, although that’s not really like revenue, it goes straight to paying that bill. So this number does not include the property management fees, nothing is taken out at this point. This is just purely what we made. Let’s take a look at how that breaks down month by month.

James Svetec 2:50
Yeah, so right off the bat, knowing the market in California and knowing a little bit about the property, I doubt she bought the property for a low enough amount that $88,000 or 80 ish $1,000 would be enough to make, you know a really substantial profit on this property. And again, like that’s it’s a tough market to be in when you’re you know, you don’t really know what you’re doing because you got into right into a market that has regulation that right off the bat is gonna make it so much less favourable for you hosting the property. And then there’s a whole bunch of stuff she could have done better, just like I know that she’s improved her photos. Now, just from the few little clips I saw there, the photos look way better than they did originally. But there’s a few different things and then like the heating expense for the pool that she mentioned, like that was something she hadn’t really anticipated. So yeah, I don’t think that this is going to end very well because I know for a lot of you guys watching this, you see ADH $1,000 And you go, Wow, that’s a tonne of money. But remember, there’s all kinds of costs that come out of that. And so it’s really important if you’re investing in anything, especially a short term rental property that you actually do your due diligence. There’s a lot of kind of opportunistic people that jumped on the bandwagon. And I would say that Shelby sound sounds like it’s probably the kind of the case is that she jumped into it without really knowing a lot about it. And you really don’t want to do that with any kind of investment. You want to make sure that you actually know what you’re getting into before you actually dive into it because it can not go so well. But let’s see how that actually ended up let’s see how much money she actually making after paying for all the expenses and everything. You can see

Unknown Speaker 4:21
here that it spikes in the late winter and spring and dips down quite a bit in the summer, January and February started a little bit slow at $2,100.04 $1,000 for February. Well Mondays I would say we’ve really only rented it out part time. We didn’t get the Airbnb live until January 11. So we didn’t have a tonne of time to get any bookings and also in February we blocked off two weeks for ourselves family and friends to use the house so that limited or bookings for that month as well. But March and April’s like you guys. Yeah, March and April both made $18,000 each. This is a high season in Palm Springs people are coming for spring Break Coachella stagecoach. So you can command the highest nightly rate at this time of year, it was typically 700 A night and sometimes all the way up to 1500 a night. And then I noticed in May, it did drop off quite a lot, May and June both made 5400 each.

James Svetec 5:19
Yeah, and just just looking at how similar those numbers are, that’s actually a really good cue for me. So let’s, let’s kind of rewind here, I noticed

Unknown Speaker 5:26
in May, it did drop off quite a lot, May and June, both made 54.

James Svetec 5:34
So with with those numbers being so so close, I’m not saying it’s for sure the case. But I find that this typically happens when people are doing more of a set it and forget it pricing strategy, because you can see that March and April are within a couple $100 from one another. And then May and June are within $50 one another. Typically, if you’re doing proper dynamic pricing adjustments, and really optimising every single nightly rate, you’re going to have a bigger variance in the in one month to the other, not always the case. But just as kind of an observation that I’m making, I wouldn’t be really surprised if she just had weekend pricing and weekday pricing, and not much more customization beyond that. And so and I’ve looked into this a little bit more like it doesn’t seem like she’s using a very good pricing strategy overall. And I know Sean Refugi, she has done another video reacting to this and kind of talking about it. And I know there were some flaws with their pricing strategy. And so that also is a big thing, like in May and June, I’d be surprised given that their shoulder seasons from high season, I’d be really surprised if there was an additional money left on the table with vacancy in her calendar, that she just didn’t lower the prices enough to capture. But I’d be really interested to see if she actually shows us the calendar later on in this video. So we can see what the occupancy rates were like for me in June,

Unknown Speaker 6:56
for 100 each, and then the summer was pretty bad. You know, it was like 1500 per month, on average.

James Svetec 7:04
Whoa, and so so I assume that there’s a lot of vacancy sitting in there. Because like, even in the dead of winter at our cottage properties outside Toronto, like that’s down season for us, and we’re still able to pull really good numbers and get like get occupancy, you just have to drop your rates down low enough. But yeah, like this is shockingly low. This is low enough that I’d be really, really surprised if there wasn’t a lot of money left on the table. And then obviously, you also have to factor in the regulations that are preventing her from actually using this property to its highest potential. It’s just, you know, that’s just gonna make things unnecessarily difficult for you to host which is why I personally just wouldn’t invest in a market like that to begin with

Unknown Speaker 7:40
ranch. Because it’s really hot here. It’s seasonal as normal, pretty much every house is is more vacant in the summertime. And then October, it did start to go back as November was still a little slow, which surprised me. We had one booking for Thanksgiving, and that was it. And then December is looking like it’s going to be $11,238. I will say that December booking does bleed into the first week of January. But because we weren’t live until January 11. That still is within that first two year window. So in total that’s that’s pretty good. I mean, yes, the summer was slow, but the spring just did so well. It really made up for it, but isn’t more than the expenses and that I knew it was going to be very close. There’s one thing I’ve learned from this whole thing is that running a short term rental

James Svetec 8:30
Yikes. So right off the bat, if it’s very close, that’s not a great thing because I you know, she didn’t get this property for free. You got to remember she had to put money into the down payment. I know she did renovation, she furnished this property. So you really want to be getting a 15 to 20% cash on cash return. Which means like, let’s say that bare minimum she put one or $200,000 in this property which I assume it’s probably close to the $200,000 mark just from kind of seeing what she’s done with the place. And if you’re putting that much cash in it means that you want to be netting at least $30,000 in your first year after paying for your mortgage taxes, insurance, operating costs, cleaning pool heating, all of that. And so she’s saying it’s close that means that she’s probably going to get cash on cash return of like just a few percent. And then the question is why wouldn’t you just go and park that money in an index fund where you can get a risk free and work free hassle free rate of return on your investment is gonna be greater than what you did with all this so and obviously you do also get to leverage when you’re investing in short term rental property not just cashflow. You also get equity built up from paying down principal on the mortgage and you get your appreciation but I still wouldn’t rely on that like you really want to make sure you have at least 15 to 20% cash cash on cash return on any given investment with with a short term rental

Unknown Speaker 9:44
so much more expensive than I expected so let’s get

James Svetec 9:48
yeah and it being so much more expensive than she expected is just you know i i don’t i don’t want to rip too much on on Shelby here because obviously like this is your first time getting started. I don’t like to discourage people from getting into this space. It’s an awesome place to be investing your money. But I will say like, that is a very avoidable problem. And hopefully she’s learned from this, hopefully, she’s realised that, you know, just not knowing what she was getting into was really where she went wrong in the first place. Because this is all stuff that with proper research, proper training, proper due diligence, you can figure out exactly down to almost the dollar, how much it is going to cost to run a short term rental that you’re looking at buying over the course of a year. So you don’t need to be surprised by any of this, you can also predict your revenue by using things like air DNA, knowing how to use that data, you can really predict a lot of this stuff. And if you just do the due diligence early on, you avoid, you know, this kind of surprise later on down the road

Unknown Speaker 10:42
into just how expensive this was. I think a lot of people just assume it’s about whatever the mortgage is. But there’s actually a lot more. No,

James Svetec 10:50
not yet. There’s definitely more expenses than just the mortgage than that.

Unknown Speaker 10:55
Here’s a quick breakdown of some of our monthly expenses. First is electricity, which average to be about $550 per month, we also have to pay for

James Svetec 11:04
No kidding, you have to pay electricity bill

Unknown Speaker 11:08
cleaning, and on average, this is $170 per month, the actual vacation rental permit, which is $1,000 a year in Palm Springs, gas is an expense that can vary greatly.

James Svetec 11:20
Again, all these expenses so far are things that you can just find out like you can ask the previous owner of the home Hey, how much do you pay for pool cleaning, hey, how much is your gas bill typically, and you can obviously factor in the gas bill that the electricity bill is going to be a bit more expensive, because it’s probably going to get used more as a short term rental than as someone’s primary home. But like this is all stuff that you can do your due diligence on, you can do a Google search and find out how much that permit costs, like all this stuff is just stuff that you should be figuring out way before one year in pools are

Unknown Speaker 11:50
heated, it’s like $20 a month, but in the peak season, it can be like $2,000 a month, on average our gas bills $1,000 a month on the pool was heated. And guests do pay for this. But we have to eat some of the costs. We also have a security system that’s $25 a month, we have liability insurance, which is $135 per month, then we have our water bill. And this is actually not too bad. It’s like 60 to $80 a month. So the total for all these expenses averages out to $5,500 per month. So quite a bit more than just the mortgage. And in reality, yeah,

James Svetec 12:24
so $5,500 a month, not hard to do the math and see that already, just with those monthly overhead expenses, we’re already like, right where we would want to be for cash on cash. And she hasn’t even talked about the cleaning expenses, she hasn’t talked about maintenance, she didn’t talked about any of that stuff yet. So not looking too good.

Unknown Speaker 12:43
It’s even more than this. Many of you know the AC unit broke, and it was $14,000 for a new one. And there were other times a handyman had to come fix things. In general, the expenses just ended up being quite a bit more than just the mortgage. So in total before property management fees, the cost to run this place.

James Svetec 13:00
And then you got to figure in that she’s also not managing the property yourself, which, you know, you got to wonder why are you not managing the property yourself at this level? Are you paying a property manager like if you’re if you’re trying to learn short term rental investing, that’s not the time to hire a property manager, the time to hire a property manager, in my opinion, as an investor is when either there’s the deal is just so good that you can afford to be hands off and still meet your cash on cash return numbers and our case, absolutely, it makes sense to get a property manager become passive great. Or if you’re really looking to get knowledgeable about investing in short term rentals, you want to do it yourself and learn the ropes. And you can you know, make an extra 20% on top of your, like not taking that out of your revenue to pay a property manager. Like it doesn’t make any sense to have a property that is losing money that you haven’t done your due diligence on and then you’re outsourcing the management of that to someone else. It’s like, okay, well, you know, obviously this isn’t gonna go well, because you you’re basically running a business that you’re running really inefficiently you bought a bad business and you’re trying to outsource it to someone else. Like, come on. I just that just doesn’t make sense to me that’s really, really shocking that she’s using a property manager when things are going the way that they are here

Unknown Speaker 14:14
is drumroll $80,914. So at that number, we are just about breaking even Oh, remember, I did have a property manager. I’m just way too busy honestly, to actually manage it myself. So for me, are worth it. But if my work was ever slower, or I would manage it,

James Svetec 14:37
no, it’s not worth it. You’re losing money on this investment. Like it’s not worth it to why would you own a property? Why would you buy something as an investment that is going to lose you money and then pay for someone else to manage that investment for you? It’s like, it’s almost like if you bought an index fund that would guarantee you a return or an annual return Have 0% And then you went and paid a fund manager to manage that investment for you. That’s That would be insane. Like, why on earth would you get into short term rentals, if you weren’t willing to do the due diligence on it, you weren’t willing to do your research. And then you weren’t willing to do the actual work of managing it and like setting up system so you could cut costs. I’m all for turning short term rentals into a passive investment. But you can’t expect to not put any work into actually doing the due diligence, researching it, and then not put any work into building out management teams or anything like that. Like this whole approach just screams like negligence to me, it’s just like, you’re basically throwing your money away at this point, why not just park at an index fund at this stage, like I’m not, I’m like, I love investing in Airbnbs. But like, if this is your mentality, then it like it just makes no sense. Guys just want to take a quick break here to say that for those of you watching, who want to build cashflow, and long term wealth by purchasing Airbnb and short term rental properties, there’s a link in the description right down below for a free training that will walk you through my exact strategy for investing successfully in Airbnb ease. Now, if you’re not ready to actually buy properties, and you want to get started managing other people’s properties on Airbnb the same way I got started and build a full time income managing other people’s properties, there’s actually another free training linked in the description down below as well, that’ll be a really great fit for you. So whether you want to invest in short term rental properties, and actually build amazing cashflow, and long term wealth by acquiring the assets, buying the properties themselves, or you’re looking to earn a full time income managing other people’s properties on Airbnb, we’ve got some awesome trainings that are linked in the description down below, that’ll definitely help you out. When you sign up for the trainings, we’re also going to send you a few other tools and resources completely for free just to help you get started. Again, the links to sign up are in the description down below. And both trainings and all the tools are completely free. So make sure to register for the trainings, links in the description down below.

Unknown Speaker 17:03
So I’ll probably have property manager 18% of each booking in total for the year, that ended up being $14,000 So the actual expense to run this place was $94,967. So we’re ending the year down $13,106 When you only factor in cash flow, and cash flow, can we

James Svetec 17:27
just think about that, like imagine putting 100 or $200,000 of your of your hard earned money out like your after tax money probably like does, like you got to work really hard to make that much money. If you’re if you’re making it, you know, obviously for her, like, I’m sure she makes tonnes of money doing the doing YouTube, but like, you know, nonetheless, like that’s hard earned money that you’re putting in and now you’re just you’re just throwing it away, like you’re investing that plus all the time and energy and brain space that took to buy the property first, the property rental, the property, all that stuff, the the stress of it. And just to lose money, like you’re just you’re paying someone to take your money from you is essentially what’s happening here, and I’m sure she’s gonna go on to justify it by going, you know, we’re gonna build equity because we pay down principal on the mortgage, and we’re also gonna get appreciation because the property’s value is gonna go up. But like, come on, you get that with a long term rental with way less headache. It’s not to say don’t invest in short term rentals, like, I’ll be the first one to tell you short term rentals are an amazing investment. But this is not the way to do it. If you’re going to invest in short term rentals, like you’ve got to make sure that you’re actually willing to put in the work to learn, you don’t have to do everything yourself, like I I never tell people to go out there and actually, you know, do the cleaning themselves or, you know, do all the guests communication themselves, you can outsource that stuff. But you’ve got to put the time into actually learning, you’ve got to be smart about it not just work hard, you got to work smart. You’ve got to learn how to analyse deals, how to find the right property, how to set it up effectively, like all that stuff. And like that’s why we do what we do is to help people to learn all that stuff as quickly and easily as possible. But if you’re just going to not put that time into learn that stuff, and then hand it off to someone else and expect it to go well for you and be this like passive like cash, like cash machine. Like that’s just not a realistic expectation.

Unknown Speaker 19:14
Great, but it’s not even the full picture, we’ll have to factor in the home that we’ve gained and home appreciation.

James Svetec 19:21
Who would have thought Who would have thought she’s gonna justify this with equity and appreciation like Yeah, but you get that without, you could get that by just buying the property like you don’t have to actually run as a short term rental. The reality is like she lost money by running this thing as a short term rental, she could have had a long term rentals, good and anything else like this whole equity appreciation thing. I get really frustrated when I hear people justifying the poor performance of their short term rentals based on this like caveat that they’re gonna get equity appreciation, because it’s just a really easy kind of way to relinquish your responsibility and like managing your investment effectively. It’s like I can just not do do deal agenda, I don’t need to do research, I don’t need to analyse it, I don’t need to do a good job of actually investing my money, because I’ll just get an equity and appreciation. The only thing is that like, can’t be taken away from me. By the way, guess what, she literally lost $14,000 in cash, that equity that she’s gonna get that appreciation she’s gonna get that’s future money. What happened now she actually lost $14,000. So this equity and appreciation thing like what happens when this property when this property plummets in value? What happens when her income isn’t what it continues to be on YouTube, and she can’t afford to be taking a $14,000 a year hit she gave me afford to be bleeding $1,000 a month? Well, now she’s about to sell this property. And what if the property’s value is less than what she bought it for? When that happens. That’s how people completely ruin themselves financially. That’s what happened to so many people in 2008. And to not learn from that. And it is use the same excuse of like, oh, equity and appreciation. It’s like, that’s a that’s a gambling chip. Equity and appreciation are the icing on top of the cake, they’re the bonus that you get when you have a cash flowing property. Because with a cash flowing property, no matter what happens, you can still afford to hold the property. Because it’s making money, it’s not losing money. With a property that’s cash like negative, it’s very easy to conceive of a situation where you wouldn’t be able to afford to carry the property. And then it’s just a total draw of the cards, whether that happens to coincide with the market being up or down. If the markets up great, you can sell it for a profit and walk away. If the markets down. You can literally ruin yourself financially. So this is just terrible, terrible investing strategy overall.

Unknown Speaker 21:37
So because this is a home that I own, every mortgage payment, a certain amount goes towards the principal payment of paying off that like this house. So this year, it was $964 per month, went towards paying off the principal payment. So in total that was $11,570 That went towards equity in the house. So while that’s not liquid cash or anything like that, it still is a gain. And still something to consider.

James Svetec 22:03
It’s a hypothetical game, though, because of the property value goes down because interest rates are rising, like so many property values have. And it’s not a real number, because you don’t actually get it

Unknown Speaker 22:14
and be so while we were down when it comes to cash flow in a way most of that just goes towards equity in the house. And then another major

James Svetec 22:23
No, no, not in a way not in a way that it doesn’t it does not you lost money. That’s what happened.

Unknown Speaker 22:29
Factor is home appreciation. This house has appreciated a lot since we first purchased it and a lot and just within the last year from

James Svetec 22:38
good, like that is great. But that’s not like she hasn’t sold it. So she doesn’t realise that appreciation. There’s nothing to say it this property can’t depreciate just as quickly as it appreciated. The market is going to fluctuate long term. Yeah, sure the property is going to do well. If you look at the appreciation over the long term, that’s almost guaranteed. But can she afford to hold on to it long term? Who knows like right now if her income is good, and she can afford to be losing $1,000 a month to carry this property? Great. But what if her income isn’t as good in the future, that’s when it gets really dicey.

Unknown Speaker 23:13
Probably what I found on Zillow, it probably appreciated like $200,000,

James Svetec 23:18
I noticed this is also not a very good way to figure out the appreciation or property by looking at properties that are for sale and have not sold on Zillow, talk to your realtor, like get them to run comps on properties that are similar that have actually sold in the last 3060 days. That’s a good way to get a comp not by going looking at Zillow, people can list their property for whatever they want. If it doesn’t actually sell for that amount. It’s not worth that amount

Unknown Speaker 23:42
is estimates aren’t always accurate. But based on comps in this case, it actually does it is so you can see when we purchase it back in 2020 for about 750. The following year. It’s skyrocketed even in 2022 went up quite a bit and has come down. But in total since purchasing a house at this point has appreciated $450,000. In this increases.

James Svetec 24:03
She thinks that’s a that’s a Zestimate you need to be Yeah, I wouldn’t trust his estimate. I wouldn’t I wouldn’t bet my financial investment on his estimate. So all I’m gonna say I’m not

Unknown Speaker 24:14
definitely unusual. Usually houses only appreciate like 3% a year but in the last couple of years, it ended up being closer to 10 to 15% per year.

James Svetec 24:23
Yeah, because the two to 3% is an average. So you’re gonna have some years that it appreciates more, not some that it appreciates less than that some that actually goes down in value like it did there and from 2022 Onward. So yeah, like this is great right now, but it’s not going to continue like this, like the good times aren’t just going to keep on rolling, things are going to revert back to the mean to the average which

Unknown Speaker 24:44
is crazy, not sustainable. What happened great, we did put $200,000 into fixing it up. So that is partially why it has appreciated.

James Svetec 24:54
Okay, so she also put $200,000 into just the renovation of this property. So Yeah, she forced some appreciation and, and that, like, that’s good if she did the right renovations, I’m a big fan of the burr strategy, like do your renovation, refinance it, pull out your equity, I don’t know if she’s actually done that refined, captured some of that cash back into her pocket. But that is a really good solid backup plan as a strategy, I just don’t know if she actually renovated with that in mind, or if she renovated the way that I would assume she renovated based on how this video is going so far, and just basically splurge on whatever she thought she wanted, versus actually looking at what’s going to drive up the value of the home and make it more valuable when you go to sell it, which is the much more strategic way to do it.

Unknown Speaker 25:38
But also it’s just because the market, I do think that there is kind of a correction going on. And probably in the next couple of years home prices. Maybe they’ll go down who really knows but long term I do think you know real estate goes up at this point, it looks like our home appreciated like four or $500,000

James Svetec 25:57
this I’m gonna I’m gonna have an aneurysm this is like it’s just guessing everything is just a guess like that’s not you should not invest your money in the same way that you go and play blackjack for your first time when you’re in Vegas. Like you don’t just guess you don’t just play it at random. It’s not the slot machine. It’s like you’re investing your hard earned money. And this is it sounds like probably closer to $350,000. Because she said she bought it for about 750 She put $200,000 into it, she sounds like $350,000 into this property more than that even just to have it losing her money like this. This could end in financial disaster, I would be very, very, very stressed out. If I had made this this increasing series of bad financial moves. I would not be cool as a cucumber in this situation. This is stressing me out just watching

Unknown Speaker 26:48
this because it’s like these are unrealized gains unless you actually sell the house. I feel like you can’t really count it. But you can because real estate does always go up.

James Svetec 26:58
No, you can’t No, you can’t use real estate does not historically go up. Like it’s shot up there over the last couple of years. That is not what historically happens. What historically happens is that real estate trends up at about two to 3% per year.

Unknown Speaker 27:12
It’s not as volatile as stocks or crypto. You kind of can’t it kind of can’t it’s not liquid. You can only get this money if you do like a cash out refinance the home appreciation. So really the factor so we’re ending numbers cashflow, we’re down 13,000 equity, we’re up $11,000 In yearly home appreciation, we’re up about $200,000 So while the cashflow wasn’t that great at the end of the day, we’re still up.

James Svetec 27:38
No you’re not at all like this is crazy. You’re Not You didn’t make a quarter million dollars you lost money. It was $250,000

Unknown Speaker 27:45
for the year, a lot of people asked me Do I think it was worth it? Do I regret it? My short answer would be I do think it was worth it and I don’t regret it but I don’t think I’d really recommend this to people as a way to make money unless it’s a house that you actually want to use yourself a lot

James Svetec 28:01
or or an alternative just just an idea would be to actually do some research and due diligence and educate yourself before you just go and Yolo your money on something. This is like this is like the Wall Street bats of Airbnb investing. It is not a good financial strategy. So I do definitely agree with her that I would not recommend doing this for the average person before for anyone for anyone at all. If you want to Yolo your money Give it to me just just I’ll put my PayPal link somewhere and you can just send me your money if you just want to burn it and throw it away. But like this is not investing. This is just is just spending this is just buying a place that you want to buy. Presumably I can only imagine for content maybe? Oh, yeah, yeah, I didn’t know anything. I was gonna get this stressed out by this video. But this investing strategy is like the furthest thing from investing strategy ever. And yeah, I would not recommend this. I really hope that she she, you know, either sees this video sees other stuff or like realises that the reason that this all went terribly for her overall, and I think she’s seeing it as much better than it is. I think it’s worse than she realises. But I think that if she hopefully realises that all of that is due to the lack of research, the lack of planning, the lack of actual due diligence, then hopefully, she can turn the ship around and if she wants to continue investing in short term rentals, she can do it the right way. Because like throwing the baby out with the bathwater. It’s just it makes no sense to me. It’s like you know, why would you why would I go and just like, you know, YOLO my money on stocks and then go Oh, no, no, I wouldn’t recommend that people go and invest in in, in in stocks. Like I just wouldn’t recommend it to anyone clearly people can’t make money with it because I YOLO my money on like four different randomly pick stocks and I lost money. So like clearly no one can make money at this. It’s like, come on, obviously you’ve got to do your due diligence, you’ve got to do your actual research. Really the only

Unknown Speaker 29:55
reason I don’t regret it is because I do use it myself a lot. If I was just Trying to make money I’d probably be kind of disappointed with these results.

James Svetec 30:04
That’s the understatement of the year. No kidding,

Unknown Speaker 30:06
the whole experience has been incredibly valuable to me. I’ve learned so much about how to take care of a house, how to work with contractors, even how to manage guests. While it might not be monetarily rewarding, at least at this point, though, experience for me has been very rewarding. Seeing real tangible improvements of the house over time has been so much fun. And now every time I come back to the house, I’m so thankful I did this, I have to pinch myself like I just love being able to visit it so much. So all in all, I would not trade the experience I’ve had, but it’ll be pretty honest and that it didn’t do as well as I thought it would and it does change my thoughts on investing in Airbnb is in the future. It’s a competitive market out here. There’s a lot of amazing houses and a lot of restrictions. And how and when you can rent it out the limited number of rental contracts per year makes it very hard to break even that nightly minimum, it honestly it makes it hard All in all, I’m super grateful for this opportunity to have an Airbnb and share the experience with you guys. I hope that you appreciate my honesty because honestly, I get a lot of backlash for sharing. It’s what this is the truth about Airbnb, I have no incentive to promote Airbnb, I don’t know if there’ll be such a good investment in 2023. And we will get into that in a different video if you enjoy this.

James Svetec 31:23
Oh yeah, I can always see this video, it’s gonna give me another aneurysm this is. So on the one hand, I’m really glad that she’s like as positive she is on it. And I want to try to end this on a bit of like, a happier note is that like, I’m glad that she sees it as a positive. And then she’s kind of like looking at the silver lining. I do think there’s a really, really big opportunity for Shelby to like actually learn a lot from these mistakes. And I think right now she’s looking at it as like, this is all Airbnbs fault. This is all like it’s just not the right thing to invest in. And there’s like this very external locus of control. And there’s not one single point in the video where she went, I did this incorrectly, I should have done this better, I should have done this differently. And the reality is like, I’m a big believer that anytime you can see other people getting amazing results at something, if you’re not able to get those results, it means that you are the one that is falling short, like let’s just look at reality for what it is. If someone else can do something that you can’t, it doesn’t mean that thing cannot be done. It just means that you can’t do it. And so I think there’s a lot that she could learn by actually looking internally and seeing okay, what could I have done differently, being a bit more self aware of the shortcomings and the error she made, I’m glad she’s looking at it as glass glass half full, but actually think that she could really, really benefit from being a little bit more self critical here. Overall, really nice for me and you guys to learn what not to do from watching someone else do it, then from you. I don’t know, I personally would much rather watch someone else do something like this than me have to go and invest hundreds of 1000s of dollars to learn this stuff. So from Knotts perspective, I do find it really valuable. There’s a lot to be learned from other people’s failures. And this is certainly in my book, this is a really big failure. I think that she should be really setting a much higher bar than she is and I think a lot of people kind of do that where they lower the bar for what they expect and you know, justify it in different ways because it’s a vacation home or equity appreciation, that kind of thing. So hopefully you guys have learned something I know I did. I learned a lot about what not to do here and so hopefully you guys take that away and don’t make these mistakes yourself. Again, let me know your thoughts in the comment section down below. If you liked this video, make sure you give it a thumbs up. If you’re new to the channel here. Make sure you hit that subscribe button so you can stay up to date with the two new videos we post every single week. With all that said, thanks so much for watching, and I’ll see you next video.