Expert Reacts to Shelby Church Losing Money on Airbnb

James Svetec 0:00
What’s up guys, in today’s video, we’re going to be reacting to a fellow YouTuber Shelby church. So if you’re not familiar with who Shelby churches, she is another person on YouTube that is much bigger than me much bigger audience. And she recently has been doing some cool stuff in the Airbnb space. But her first Airbnb project didn’t really quite go to plan. She just released a video about a month ago on her channel, detailing the first Airbnb that she purchased in Palm Springs, California. And that property lost money. So she did a recap kind of breakdown of that. And there’s been a lot of talk recently about people losing money on short term rental and Airbnb properties. So I wanted to do a reaction video just kind of going through and seeing what went well, what went poorly and mistakes that were made along the way, as well as what I think you as a potential investor in short term rentals could learn from this whole process. So I’m going to be reacting to this and sharing my thoughts. As someone who’s been in the Airbnb space for years and years now, and has multiple properties. I want to get my reaction to my feedback, my thoughts on this video. So let’s go ahead and let’s jump right in.

Unknown Speaker 1:11
Two years ago, I bought a house in Palm Springs and renovated it and last January, I put it on Airbnb, when the house was finally ready, I was so excited to see how it would do on Airbnb. And it was a little slow at first, but come spring, things were really heating up and we’re making a lot of money. Finally, all the work seemed worth it. And it was kind of like magic, how it was truly passive income once.

James Svetec 1:36
So right off the bat, I’ll say like Palm Springs, and I already knew this going into a Palm Springs is a market that has gotten really saturated over the last couple years, a lot of opportunistic investors were jumping in on it. And I will say a couple of things. So far with the video Like, I will say the one kind of gripe I have is when people talk about Airbnb or short term rental being truly passive, Alex or mosiac, she put out a really good video about this recently where he talks about how investing in anything is not passive or active. It’s really a continuum. It’s a spectrum, right. So on the far end, like one of the most passive investments you can make would be into an index fund. But to do that, you still have to open a brokerage account, you still have to go and research different funds, you still have to decide which one to do, and then actually put the money in there, put the money into it. And on the most active side would be like your job where you’re, you know, literally doing active or your business, that kind of stuff. And so there’s all there’s this huge spectrum and real estate is way more passive than, than building a business but way more active than investing in index fund. And even if you do get it to the point where it’s like truly passive, you’re still gonna have things come up, you still have to pay your bills, you have to spend time doing that you still had to spend time initially early on finding the deal renovating it, all that stuff. So I just want to clarify like anytime that people talk about Airbnb ease or real estate investing as being truly passive income, I see a bit of a flag there, because it is passive but I just don’t want people to get the wrong idea and think that it’s like you know sitting on a beach sipping a margarita while the money rolls into your bank account. It certainly is not that that’s what she was getting out of that was just more just a thought that I had that I just want to clarify for a lot of people because I think a lot of you’re watching these videos are watching and thinking okay, well I can invest myself and have it be this like passive income stream, and just realise that there is activity involved in it. It’s not something for nothing.

Unknown Speaker 3:26
The summer hit though it was looking very different. And I’ve shared our best month, but I haven’t shared the full story yet. I’m not going to sugarcoat it you guys ate we lost money. We it’s not looking good. But I will go into detail into why and really the things I’ve learned and what you should know if you’re ever thinking of doing an Airbnb. Okay, so let’s take a look at what the summer was like, let’s start with how much we actually made going into the summer, the bank account balance for the house was $25,000.

James Svetec 3:58
This is actually a really good note, I think a lot of people, it’s good that you include this because a lot of people don’t think about this one little thing to small note that she made about it. But a lot of people don’t even consider the fact that when they buy a property, they need to hold some money in an account for like a maintenance reserve just in case anything goes wrong. You don’t want to have your bank balance be zero. So just make sure that when you’re looking at buying a property, you’re accounting for the downpayment and the closing costs and the renovation costs but also money that you want to have sitting in cash in your bank account ready in case it’s ever needed. So just make sure you factor that in when you’re looking at investing and calculating how much cash you’ll need.

Unknown Speaker 4:37
So I’m just going to be talking about what we made over the summer. If you want to know what we made in the spring, which is really the high season of Airbnb in Palm Springs. You can go watch this video, I’ll put it in the description. That is where you’re gonna see like the good ones where you make a lot and exactly how much it all breaks down to so go check that out. So we’re doing really well in the spring and then summer or hits. Let’s start with June. So June, we had two bookings. And the nightly rate was not that high, I think it was like four or $500 a night, the total amount paid was $5,450. After all the fees, the property management fee and everything, we got $4,106 for June.

James Svetec 5:22
So. So right off the bat, I think there’s a couple of things. One is, when Shelby’s talking about about like, last season about oh, and then the spring came or sorry, then the summer came, you really should expect that when you’re investing in Airbnb or short term rental, it’s going to be a lot more seasonal than a long term rental, a long term rental, the nature of it is you get the same exact amount every single month. And it’s either one or zero, either you’re getting money or you don’t have someone in there and you’re not. And with Airbnb or short term rental, there’s a lot more fluctuation. And so a lot of people shy away from investing in short term rentals, because they know about that fluctuation and they see it as unpredictable or volatile. And reality. It’s not unpredictable. The fluctuations are highly predictable. If you use tools like air DNA, and you do proper analysis, which it sounds like Chelsea, shall we probably didn’t. And so if you do that, that proper analysis ahead of time, then you can predict this and you can know what to expect. So and then the other thing I wonder about is like how many nights was it book because she mentioned here that it was booked for only two bookings. But I don’t know how many, how many nights those were. So if each one of those was like two weeks long, and the whole month was booked out, but it sounds like it was probably only more like like four or five days each one. And so if the if it just really just depends on what the target is that might that may or may not be good. For the area. I don’t know what the occupancy rate target is for the area in that month. But it really depends like in some markets, you’re aiming for 50% occupancy in the low months of the year. And that’s good. That’s what to expect. And you make your money in the high season. And that’s really predictable. And that’s like totally good. So it might not be a bad thing. Or it might be a bad thing. It might just be that she overpriced the property. It’s a little bit hard to tell.

Unknown Speaker 7:04
Honestly, that’s kind of a break even month. It’s not too bad for the summer. That’s kind of what I was expecting. Okay, July we had one renter. One, I changed the names of these renters by the way to protect their privacy. But these are fake names Karen, Patty, Molly, all that totally fake name. So we had one renter, only three nights were booked out. So they paid $1,500 We got $1,106. Obviously, this is not enough to cover any of the expenses. Like it’s not even enough to cover the utilities probably. And I will say we probably could have lowered our nightly rate more. However, our electricity bill gets so high in the summer that it would you would almost maybe lose money by hosting people if you make your nightly rate too low. August.

James Svetec 7:55
Yeah. So that is a really, that’s that’s a big challenge for people is that they think about the wrong way. And so in this in this example, it probably wasn’t just the nightly rate that needed adjusting, you probably have lots of things that you could do to get more bookings in for that month. But also, like, realistically, what is the additional expense because I know that there’s a pool this property, so maybe it’s that she’s not charging extra for the pool heating. In that case, yeah, the hydro be really expensive. And so it wouldn’t make sense. But like, air conditioning or heating for the property probably isn’t that expensive that it would cost like, you know, more than $400 a night, because this person is paying $500 a night for their three night booking, try not costing $500 a day to heat the property. If it is that’s crazy. But really, you could probably lower your price down a whole lot more and get additional bookings in there. And then the other thing is that if you keep the calendar consistently booked and you keep on getting bookings, and you keep getting more reviews, and then it compounds on itself and you perform a lot better long term. So definitely flawed thinking there definitely should not be as low in occupancy as like three nights booked for the entire month. That’s super, super low. So there’s definitely a lot of money being left on the table there.

Unknown Speaker 9:11
We had one renter, they rented for three nights it paid $1,221 We had some expenses that we had to pay for just we had a few things we had to pay someone to come fix within the house that was $400. So we only got $562 for this month. Okay, we had one guest for September, three nights, they paid 1500 We got $1,184 So our total revenue before any of the expenses over the summer was $6,970. Not nearly like we literally made like don’t like almost tripled that in one month in the spring. So it’s crazy. I knew the summer would be slow. I didn’t know it would be that slow. So now let’s

James Svetec 9:58
Yeah, so that’s things like you really need to do an in depth analysis and lots of due diligence to really know exactly what to expect, so that you can plan for it and so that you can determine if it’s actually a good investment or not. Because, you know, if you weren’t expecting it to be this low, and then it’s way lower than you anticipated, well, then your return is way lower than you anticipated. So suddenly, your cash flow might be wiped away for the property, and then you just put a whole bunch of work in for nothing, because it was a bad investment. So doubly need to do your due diligence, better there and just like do the research, that’s just something you need to do on any investment where you’re putting a bunch of money into it. And then the other piece is just like, there’s definitely some things going on there where I think you could improve either the listing or the pricing strategy, do things to just improve the overall performance of the property, so that it’s not doing quite as poorly as it did in those months.

Unknown Speaker 10:45
Let’s get into the expenses, because this is where it gets back. So here’s a look at the overall expenses. For the most part, it’s about the same every month, it really only fluctuates on the utilities, mainly on the electricity, because the electricity bill can get very high in the summer.

James Svetec 11:03
Yeah, so you look at that, like that’s, that’s an $800. Like at the peak of it. It’s an $800 electricity bill that works out to like, what does that workout two per day, it’s not like, you know, you could lower your prices down to $200 a night for this place and still be making good money on it like that the electricity bill is high. Yeah, for sure. But it’s not insane. And there’s probably things you can do like renovations you can make, I don’t know what what is leading to that high electricity bill, what the deal is there, but you could probably do do some things to make that more efficient. But yeah, I think it’s flawed to think that, that you shouldn’t lower your price below $500 A night or $400 a night, because it’s going to cost you too much to have those guests. That’s just not the case.

Unknown Speaker 11:47
And the gas bill can get really high in the winter. But luckily, our gas bill is pretty low right now. So we can see the mortgage is the same every month, it’s $3,000. And that includes the property taxes, homeowners insurance, principal, and interest SCE is our electricity bill. And as you can see, it was really high in June and July. And what I realised is the thermostat was being left on all the time set at 86 degrees.

James Svetec 12:13
Yeah, that’s a huge, huge mistake. I actually had that happen recently, we didn’t have this bad, we had a $300 hydro bill, because my nest thermostat wasn’t set up properly. But what you definitely want to do with your short term rental is get a smart thermostat like a nest, I really liked the nest one, you can control it remotely from your phone, what I like to do is set it so if there’s like a Home and Away setting so that when it detects that no one’s in the property, it’ll automatically lower down the temperature. Well, I mean, if it’s in the wintertime, it’ll lower it down. So it’s not heating it as high. And in the summertime, you can set it so that it raises it up and it’s not cooling it down as low. So that’s super helpful. And then where you could also do is set schedules so that in the morning, it automatically adjust to this temperature at the night, it automatically just this temperature. What’s really great about that is it then when a guest changes in, you know, cranks the heat or cranks the AC, it’ll automatically adjust back to something within reason, like 12 hours later. So yeah, that can definitely be an issue.

Unknown Speaker 13:13
So basically, the AC was running for no reason. Even when people weren’t there. That was kind of my property managers call. When I realised our AC Bill was so high, I asked her to turn it off completely when people are gone. And as we can see, it’s gone down to $500.

James Svetec 13:29
Yeah, so much for work to do that manually. And it’s so much less efficient, because like the property manager is clearly not doing a great, great job of that because it’s still like five $600 a month for your for your your cooling bill. So yeah, I would say like get a smart thermostat, the best thing you can do here, it’s going to be a couple $100. And it’s going to mitigate so much of this expense, because you can really crank it off when it’s wet. Like you’ve completely turned off when guests aren’t there. And you can keep it reasonable while the guests are there and control it remotely. So your property manager doesn’t have to bill you for their time or whatever to go by there and turned off way, way easier.

Unknown Speaker 14:08
I don’t even want to know what the electricity bill would be if the house was fully booked. Like it would probably be like 2500. But water bill, you

James Svetec 14:15
know, I mean, realistically it wouldn’t because you’re not using that much. Again, it’s not to say without looking at the bill, but like I think I think there’s an overestimation of how much more it’s going to end up costing if it’s fully booked. So I think yeah, you can be a bit more conservative with their

Unknown Speaker 14:31
will usually hovers at the same 70 to $100 gas is pretty inexpensive in the summer at like $10 the pool cleaning is $170 per month and that $220 One we had to get new filters that’s why it was a little bit more and then we also added on pest control in July because we noticed like these very, very small ants. So just to be safe. We now have a pest control company comm I am also just now remembering we also Pay for simply safe and maybe a few other random subscriptions. So that’s probably an extra $100. Alright, so for June, the total expenses were 4300. July was about the same August and September were even lower at about 3900. Thanks to saving a little on that electricity bill. But you can see on each month, we didn’t even break even, we were really at a loss of like, about $3,000. For each of these months, when we calculate in the revenue, we really were down $9,479. But our beginning bank balance was $25,000. So we still had $16,000 in the bank, even after being at a loss for all these months, because the high season really is like very profitable. So the ending total at $16,000. It is worse than I expected, I will admit, but it’s still not that bad. But we did end up having a couple more expenses that I did want to factor in here. Because if you’re thinking of doing a short term rental, these are going to come into play. And that is maintenance and additional property taxes. So our house because we renovated it, we didn’t really have that much maintenance, but there was one thing and that was replacing the AC unit, it was 30 years old, we should have just done it while we’re doing everything else. But we didn’t end come this summer, it wasn’t working so well. So we had to pay to get a new one. As you can see the cost for the unit and to get it installed was $12,967. And then it was another 1200 to repatched. The roof area where they put it in.

James Svetec 16:48
That isn’t expensive AC unit Holy smokes. Yeah, and I mean, that’s probably why they’re their electricity bill was so I assume that they’re that they’ve got an electric AC that’s like, that’s what’s rent running up their electricity bill every month. So that’s definitely one of those things that like that. And just making sure you have good windows that keep the heater or the cold in like that, that kind of stuff is going to be a good investment long term. But yeah, that’s that’s a tough one when they’ve had bad months. And that’s again, that’s why you keep a bank balance of like $25,000, you want to keep a maintenance reserve set aside, so that you can have money set aside for those kinds of unexpected expenses or anything that happens like that.

Unknown Speaker 17:27
So in total, that’s a pretty major expense, considering we only had 16,000 left in this account, wasn’t expecting it, but also kind of was expecting that like I knew we would have to do that, at some point, at least we could use some of our earnings to do this, rather than dipping into our own money like we weren’t during the whole renovation. And then another expected but unexpected expense that I just totally forgot about was additional property taxes. So I’m sure you guys know, home prices went up significantly in the last couple years. And with that, so did everyone’s property taxes, maybe in some cases, people have it locked in, but not in our case. So we actually got a bill recently that we need to pay an extra $4,647. Like that is a lot. That’s a really significant amount that has been added. So not only do we have to kind of like back pay, I believe this 4000 amount, but also moving forward, our mortgage isn’t $3,059 anymore. Now every month, we have to pay about $3,400. I know I say mortgage here, but that includes property taxes in that lump amount, that’s something that I just didn’t really think about, but is good to know that you know, property taxes will go up. So that was another $18,850. In expenses. These added expenses were even more than like just our actual cost of running it like our mortgage and utilities and everything. So the ending balance was negative $2,821. So obviously, I had to dip into another one of my accounts to cover the costs, I really didn’t expect that we were going to have to do that things felt like they were going so well in the spring.

James Svetec 19:13
So this is exactly the what you really, really want to avoid. Now obviously for Shelby, I assume she’s making pretty good, good money on her YouTube channel, which is like her main source of income. So there’s not like a huge, you know, huge red flag here for her because, you know, high incomes you can afford to drop in and you know, get $3,000 to float it. But the challenge here is that like as you grow, you know, if you start to really leverage yourself and you start to buy more properties, or if you lose your job and lose your income stuff like this is what really ruins people financially like this is what ruined people back in 2008 was that they bought properties they couldn’t afford. They weren’t planning on carrying the cost of it, and then their income dried up or you know things things change around Now they can’t afford to carry that property anymore. And so they’re forced to sell it. And if they’re forced to sell it and the market is down like it was in 2008, that’s when they had to declare bankruptcy like they’re just done right, you can’t afford to, most people can’t afford to stomach that loss of a property value dropping by $100,000, and you needing to sell at $100,000 loss and lock that in. So this is really like a should be a cautionary tale to anyone that’s looking at investing in short term rentals is you need to plan effectively, and you need to make sure I don’t know how the entire year is going to shape up. But you never want to buy a property that is at a risk of cash flowing negative on an annualised basis, and you certainly don’t want to be taking on unexpected losses where you have to dip into your own savings, because that’s a really dangerous paths path where if that gets out of control, and you suddenly you can’t afford to do it, you’ve got to sell the property and not so people end up in really hot water.

Unknown Speaker 20:54
But this is the risk that you take with Airbnb, you know,

James Svetec 20:57
no, it’s not it is not the risk that you take with Airbnb is the risk that you take with Airbnb, when you don’t do your own due diligence. I’m not trying to be mean here. But if you actually do proper due diligence, analyse your deals properly, and educate yourself properly about the deal about everything else than going into a deal like this. And it’s not a risk you need to take. There are risks associated with Airbnb investing. But I mean, you can mitigate almost all of them by just buying the right property, buying the right deal, looking at the downside potential analysing it, making sure that you can stomach because so many of you will just look at only the best case scenario or a good scenario. And they don’t actually think to look at the worst case scenario. And actually consider all the different elements like you know, not considering the maintenance for having replace that 30 year old air conditioner. Not something that in hindsight, you know, we can look at it, we can say, obviously, you need to replace a 30 year old air conditioner. But if you actually just you know, go and do your your research and everything else beforehand, then you can know those things going into it, you don’t have to experience it. You don’t have to learn it by by experiencing the pain. So I would not agree this is a risk you have to take, it is a risk that you take if you’re not doing it the right way. You 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, there’ll be a really great fit for you. So whether you want to invest in short term rental properties and actually build amazing cash flow 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 links in the description down below, that will 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 23:21
Oh, on the plus side, we’ve at least been able to pay the mortgage and also pay for a new AC unit with our earnings, about $10,000 per year of the mortgage goes towards the principal payments that’s $10,000 in equity we have added in the house. And I’ve learned a few things we can change in order to do better next summer. The first thing being I really want to get solar panels, the electricity bill is really our second biggest expense. And with solar panels, you can get that down to pretty much nothing. Of course, it’s a hefty initial investment, I believe it’s between 20 to $30,000. But there’s a really great tax credit available right now in our electricity bill is just so high every month that it would really be worth it for us. So while it normally is a low season in Palm Springs in the summer, from what I’ve gathered this year wasn’t especially like record low in terms of short term rentals. From what I heard pretty much everyone probably had a similar experience to mine. I’m really glad I didn’t spend any of the money that we made in the spring time.

James Svetec 24:21
So we’ll say like, this is a common thing I see people do as well as when they when their property performs well. They kind of do the mental gymnastics to justify it and go Well, you know, I took the property will probably appreciate and I pay down the principal on the mortgage to the tune of about $10,000. So I built some equity, you know, and I learned and I’m going to do this differently and that’s good. I think you should do that. I think you should like learn from your mistakes, but also, I think it bears it merits pointing out here that that $10,000 in equity. That’s you know, that’s subjective. That’s like, you know, really it’s it’s only you only get to realise that when you either sell the property or refinancing as you don’t know should have access to that capital. And it depends on what the property’s worth when you refinance it or sell it. So the property has dropped in value like it likely has over the last year, then you don’t really have that equity there. It’s not like you could ever actually access it. So it’s not really something to fall back on. Cash flow is really where you make your money with Airbnb and short term rentals. That’s where you want to be focusing on and if you’ve dropped the ball there, then you’ve kind of dropped the ball on the whole investment. So I wouldn’t say it’s a salvageable investment at this point, like it was, it’s just tough, right? Like, if you make the wrong decision, when you buy, it’s really an uphill battle to make that investment makes sense. If you buy the right property, a trained monkey can make that thing profitable. But if you buy the wrong property in the beginning, then it’s really an uphill battle and really challenging to salvage it. So that stuff, I think the solar panels are probably a good idea, if that’s really what’s causing the big part of the cost, but also the revenue. Like I would say that another thing to focus on would be optimising your revenue. Because the reality is that the people she’s probably talking to who are commiserating with her saying, oh, yeah, we’ve all done this. It’s like, those are the people that aren’t performing well. But the reality is, in any market, there’s still demand, it’s just that the lion’s share of the demand I talked with in other videos, the lion’s share of the demand goes to the top 1015 20% of hosts in that area, and then everyone else is left kind of grabbing the scraps of the bookings. And so if you did some things to optimise the listing, optimise your pricing, just optimise it better, she’d probably be able to get a lot more revenue. And, you know, realistically, if she’s booking this place at four or $500 a night, then what would be a bigger a bigger advantage, right? Getting a couple more nights booked or reducing that electricity bill, that’s $800 a month, right. So you’re probably better off putting your energy into trying to get more bookings, and optimise your strategies. I don’t know if she’s listed on other platforms like VRBO home like these other platforms, aside from just Airbnb, I don’t know what the overall strategy is there. But I’m sure there’s room for improvement there. And to me, that’s a way higher leverage thing to focus on, that is not going to cost additional money, versus going and spending $20,000 to instal solar panels. So you can reduce your $800 a month in some months of the year electricity bill.

Unknown Speaker 27:16
Because it really saved me in the summer and covering like almost all the costs. Okay, one to pop back in here. While I’m editing this to talk about why I think this low season was so low one, we are in more of a recession, or at least there are fears of more of a recession, interest rates are higher people are obviously not spending as much money on travel. And I wouldn’t be shocked if that continues. So I do think that plays a part in this to airline prices are still pretty high for me to fly to Palm Springs right now, if I wanted to go last minute would be $800. from Seattle, I think airline prices might have something to do with it. Because a lot of our bookings were people flying in from New York and Chicago, cold places. And three, I might have mentioned this, but it is just so hot in Palm Springs in the summer that people really don’t want to go, I thought they’d go a little more than like one or two bookings though, I think we just needed to lower price more. Because even if we got our energy costs lower, we still have a certain amount that we need to make any bookings to cover all these costs. So all in all, it was a slow summer, and it’s still been a pretty slow fall for myself. And yeah,

James Svetec 28:29
I got it, I gotta jump in here again and say like the recession, it really just means yes, there is less overall spending going in. So you have to have a more adaptive pricing strategy. So that’s one thing, you can’t just do the set it and forget it pricing like they’ve done here. The other thing is that again, you just need to be one of those top 10 20% of listings, because they’re the ones that are getting all the demand. If there’s less demand than there is supply, it doesn’t mean that everyone right across the board experiences a significant and equal drop in overall bookings. It means that the people in the bottom part of the market that bottom 80%, they see a massive drop, and then the people in the top 20% They see a small drop. So the recession would be a contributing factor but not in the way that she’s pointing to there. You can definitely do a lot better than what what she’s done here. By just optimising your pricing, optimising your listing, those sorts of things. The other thing to think about is that like, we have a similar issue like I invest primarily in Ontario, Canada, and in the winter, it’s awful. Like it’s, it’s, there’s it’s snowy, it’s awful, like there’s not really a lot to do. It’s like, there’s just not a lot going on that would draw people here, because it’s just like snowing and dark and kind of gloomy. And so why do people come there? Well, we have to add amenities that give people a reason to come there. So for example, in all our properties, we have a hot tub and a sauna, and we have snow shoes and all kinds of things to do. So I would I would say like if this were my property, I would have looked for a property in Palm Springs that were was near and attraction that would keep people coming there even in the low season so I just bought a property That’s right near a ski hill. So that gives people a reason to come by there in the wintertime when it’s low season. The other thing is like look to add amenities, that’s something that you can easily do right now to would be to just look for amenities that you could add that would draw more people in. So it really depends, and you just have to understand your ideal guest and why they’re booking with you. And try to think and put yourself in their shoes to think what would make them want to book this property. And if you can do that effectively, then you can add some cool amenities that usually are very expensive, they will get more people booking in those low seasons as well.

Unknown Speaker 30:33
And for other Palm Springs vacation rentals, I do think it’ll pick up in the winter in the spring, but I don’t know if it will be as good as last year, because it just seems like people aren’t spending as much money on travel. And that’s totally fair. So even though it was a rough summer,

James Svetec 30:50
and again, that’s something that you need to take account of, because we knew going in going through 2020 and 2021, that that wasn’t going to become the norm. So if you’ve seen any other videos on the channel, where I do property analysis, I like to look back at 2018 and 2019, to see how things went then, because what most areas are experiencing is that, yeah, there they are in 2018 and 2019. They did well, huge spike and 2020 and 2021. And then it drops back down to right around where it was in 2019. Or a little bit better than that in 2022 here. And what people think is that it’s like really, really bad. There’s no way we could have predicted this. And it’s like, well, no, it’s not really, really bad. We could have predicted this we could have just seen okay, it was an anomaly year for a couple of years there with everything going on in the world. And now we’re just going back to normal. So it’s not this like unpredictable, we never could have seen it coming you absolutely could have if you just do the right analysis. And you don’t want to be banking on it doing as well as 2020 and 2021 knots. Unfortunately, what a lot of people did when they were making decisions on what properties to buy, I was banking on the Good times never ending

Unknown Speaker 31:51
these and I still don’t regret doing an Airbnb in Palm Springs. Because personally, I love going to it. And it was really fun, the whole process of turning it into an Airbnb and everything. For me, it’s really not just about making money, but it’s actually a place myself, family and friends all go to and enjoy. So honestly, even if it just breaks even, that’s kind of fine with me, because I still love this house. I actually love being an Airbnb host. And I think this is just a temporary low season, you know, at the end of five years, I’m sure things will eat it out.

James Svetec 32:24
So I hope you guys Yeah, so I mean, that’s honestly, that’s a really good place to end is it that is one of the big huge advantages of owning a short term rental is it is a lot of fun to do. And it’s really cool to own these properties that you can go to and hang out at. And I will say it is much better to own properties that you can go to and hang out at that also make you a bunch of money who wouldn’t want to make money, if you have the option to and you can enjoy the property either way, of course, you’d want to make a bunch more money. We’ve got a property that I plan on spending a whole bunch of time out this year I enjoyed have already been up a few times. And it’s going to make me 50 $60,000. Net this year. That’s awesome, right? Because I still got to enjoy it still get to go hang out. It’s a really cool property. But, you know, at the end of the day, it’s a lot of fun. There’s a learning curve, I really appreciate honestly, and I commend Shelby for putting this video out there because I think a lot of people are in the same boat as Shelby here and just aren’t talking about it. There’s definitely a lot of people I’ve spoken with that are losing money on their Airbnb that made the wrong investments. And I think it’s really amazing that she took the time to put this video together and be really transparent and candid about everything going on and then do a breakdown as to why so I think that’s really great overall is a really good video and I wish I’ll be nothing but the best with this property and I think she’s doing more projects as well. So those go incredibly well also. Yeah, if you enjoyed this video, make sure you hit the like button make sure you hit that subscribe button to stay up to date with more videos we release to every single week on the channel. Shelley if you’re watching I hope you enjoyed this I hope you got some value from it. I hope you you take some of these tips feel free to let me know in the comment section down below what you guys think and otherwise have an awesome rest your day.