There’s a crucial element many beginners often miss – avoiding costly mistakes. We’re talking about missteps that could cost you tens, or even hundreds of thousands of dollars!.
But there’s a secret weapon you can use to avoid this.
In this video, I share personal experiences and real-world examples of how this secret weapon can make all the difference.
I talk to investors like you every day on the phone and I tell the story of one where they paid over the asking price, one where they bought a property expected to just break even, and others who are leaving many thousands on the table.
It’s all too common, and it could happen to you without this secret weapon.
What is it? Check out the video to learn more and hear these real world examples that could’ve been easily avoided.
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Expand Transcript
What’s up guys? In today’s video, I want to talk about the harsh truth of Airbnb investing that so many people overlook, no one talks about this. And I come across this all the time when I’m talking about people that are either just getting started or that have already been bought short term rental properties. And this is a harsh truth that you really should have your eyes wide open to before you get started investing in short term rental properties, because it’s not all sunshine and rainbows. Let’s talk about.
So the first thing that I see people doing that they just don’t realise about short term rental investing is that there’s 10s of 1000s of dollars of mistakes, if not hundreds of 1000s of dollars and mistakes that you can very easily make if you are not experienced enough. That’s why I so strongly recommend working with a mentor. Now I get it, I’m biassed I do mentor people and show them how to invest successfully in short term rental properties. But it’s just insane to me that someone would consider investing 10s if not hundreds of 1000s of dollars of their hard earned money into something that they don’t have expertise in yet. Even me when I first got started buying my very first short term rental property. It was after six years of experience managing properties, consulting on them, even writing the book, Airbnb for Dummies, working with the likes of Rich Dad, Poor Dad, Robert Kiyosaki. And even then I realised that I didn’t have the expertise that I needed in the real estate investing side of the equation. And so I partnered up with my now business partner, Riley, who mentors along with me for all our students, because for six years before that, he was getting all the know how and experience on real estate investing and has done countless deals, renovation projects, you know, bought a single family multifamily properties in multiple different markets, and was coaching around that as well how to this tremendous expertise. And if you don’t have that expertise on both fronts, then there’s just so many mistakes that you can make along the way. Like, for example, the first property that I ever got, alongside Riley, we ended up negotiating $100,000 off of the asking price. And that was in a market that was in a market where every single property was going for over asking, I never would have known that I could negotiate $100,000 off of the asking price. Everyone else in the market was just passing this property up. And no one realised that they could get this property for incredible deal. Not only that, but there were things that came up in the inspection that allowed us to negotiate that down that I would have had to come across as just an expense item had I not known that going into it. And the thing is, I see this happening all the time, I talked to people who buy properties, and they overpay for them. Just yesterday, I was on a call with someone who overpaid for their property. So much so that their lender when they went to get financing on the property wouldn’t even give them a mortgage on the full purchase price, because they bought it for more than the property was worth. And what happens when you do that is the lenders only going to loan what the property is actually worth. And you have to make up the difference. So they ended up overspending on the property in their own cash by a couple $100,000 and then didn’t have money for the things that they needed to to make the property perform well. Not only that, but even if you buy the right property, you risk buying the or buy the property for the right price, I should say you bet risk just buying the wrong property, these people bought a property that I was just speaking to yesterday, that in a best case scenario will be cash flowing 15 to 20%. But in a reasonable scenario, it’ll be at breakeven and worst case, it can actually be cash flowing negative, that’s the opposite of what you want, you really want to be buying properties that are going to cashflow positive, with very little effort and hit that 15 to 20% cash on cash return and a reasonable easy to achieve scenario. You want your worst case scenario to be breaking even not your reasonable scenario or your best case scenario. And sure, we can help people who have bought a property to make it perform as well as possible and get that cash flowing so that they can scale. But ultimately, you really want to start working with a mentor or working with a coach before you actually buy the property because not only can they help you to buy the property for a better price, and get a really good deal on that property. Make sure that you’re building in 10s If not $100,000 in equity, right from the start and improving your ROI right from the start and minimising your downside right from the start. But they can also help you to make sure that they’re you’re gonna buy the right property to begin with and it’s actually the right property that’s going to perform well. And then the other mistake I see people making is that they just leave money on the table. You know, even if they get the right deal on the property even if they buy the right property. The reality is they’ve probably never done this before. They don’t know how to optimise an Airbnb listing, they don’t know how to make it show up high in the search results, they don’t know how to dial in their pricing strategy to make sure they’re not leaving money on the table. And so as a result, they end up leaving 1000s of dollars on the table, every single year, I see this happen routinely. I see people leaving literally five to $15,000 a year on the table every single year, very routinely, I talk to people every single week almost that this exact thing is happening. And I love it, that we can help them but I really wish they’d come to us earlier, because then we can help them to make sure that doesn’t happen, because by the time they come to us a lot of time people have already missed out on a few years where their performance it’s already they flushed $30,000 down the drain, doesn’t it make more sense to just pay some money to invest and work with a coach who can help you to avoid those mistakes? I think a lot of people realise that. But I wish that people didn’t have to spend and waste money in order to learn that lesson the hard way. And so this video is my call to action to you that if you’re looking to invest in short term rentals, and you’re thinking about doing it yourself, I would just ask you, I would just ask yourself, you know, is it possible that you could overspend on that property by $10,000 $20,000 $50,000, because you don’t know what you’re doing, you don’t know what the property’s worth. The reality is, for a lot of properties, depending on the purchase price you’re aiming for. That’s only a 1% overpayment, you’re only overpaying for the property by one or two or 3%. And it’s 10s of 1000s of dollars. So
the reality is, for most people, even myself included, that’s why I trust Riley with that side of things, because he’s been doing this for years and years. And he’s done countless deals. And it takes actually having that expertise and that experience that track record to be able to make sure that you’re not overpaying or that you’re not, you know, not negotiating the way that you should, you might want to make sure you get the best possible deal. So just think about it. Is that possible, right? And then add to it that you know, maybe you buy the wrong property, and you get a property that cash flows at 5% instead of 15%. Well, that’s compounding every single year, that means it’s going to be slower for you to buy the next property, it means gonna be more challenging, it’s gonna be more headache for you. Is it possible that you’re going to do that? Yeah, probably. And that’s going to cost you probably 10 $20,000, every single year, year over year, that adds up to hundreds of 1000s of dollars over the lifetime of that investment. And then is it then possible that you’d have a hard time optimising performance that you maybe wouldn’t perform as well as you could and that you’d leave 510 15% on the table? Well, again, that’s 1000s of dollars a year that you’re leaving on the table that literally in just a few minutes a week, if you knew what buttons to push what levers to pull, you could get an extra 510 $15,000 A year coming in. It’s just a total no brainer. And then another mistake I see people making all the time is that they hire the wrong property management company. And this is almost one of the worst ones because they finally made it to the finish line, they’ve got the property, they get it set up and they work with a property management company that does a bad job. Right, the property management company is now leaving money on the table. So not only are you paying them every single month, a percentage of your revenue, but you’re paying them that percentage so that they can underperform so that they can cause more headaches for you. So they can not get you good reviews on your listing, I see this happening all the time. And the reality is I’ve worked with 650 or more property management companies, I’ve run my own property management company, that’s what allows me to be able to screen and vet and find the best property management company, because the difference between the best and the second best in your area is again, probably going to equate to 1000s of dollars every single year. Not to mention if you pick one of the worst property management companies in your area, and that’s going to be even more expensive. So there’s just so many different points at which you can lose so much money in real estate investing because we’re playing with big numbers here. And that’s what I think people readers forget about right is sure you might only be investing 5070 $100,000 into the down payment. But we’re talking about an asset that’s valued at 500 600. A million dollars, right. And so there’s so much opportunity to make small mistakes that will add up to really, really large dollar amounts, it’s easy to make 10s of 1000s of dollars worth of mistakes. When you’re buying a half million million dollar asset and you’re expecting not to produce 100,000 $200,000 a year in revenue. There’s all kinds of opportunity for money to be lost or left on the table. So take this as a cautionary tale. If you’re going to get into Airbnb investing, do it the right way. It’s not easy if you’re just getting started doing it all on your own figuring out through trial and error. Reinventing that wheel is not something I would recommend doing. Again like I practice what I preach I wouldn’t be saying this. If I didn’t actually apply this in my own life. I wouldn’t manage other people’s properties to learn the ins and outs of Airbnb became a world leading expert in it before I went Put my hard earned money into actually investing. And even when I did that I teamed up with Riley, who has this experience in real estate investing so we could combine that knowledge. And it’s that combined knowledge that we now use when we’re mentoring people and showing them how to invest successfully in Airbnb and short term rentals. 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 ease 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 s. 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 will 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 linked 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. So just think about that. And consider you know, if you’re investing in short term rentals, is it really worth the headache? Is it really worth the frustration is it really worth the cost of doing it on your own and making those mistakes, because the reality is short of working with someone who’s already been there and done that and getting that expertise from them getting the tools, their training, their resources, the guidance from them, there’s really not much you can do to avoid those mistakes entirely. You can go and educate yourself. And I put two new videos out every single week on YouTube, it’s completely free for people to use. And I highly recommend that you use these tools. They’re amazing tools. And this training is incredibly valuable. And I pride myself on that. But what you really want is someone to be there looking over your shoulder, if this is your first time doing it, you want someone there looking over your shoulder, if you’re trying to do something you’ve never done before, if you’re trying to grow your portfolio in a way that you’ve never done before, optimise it to new heights, you want someone to be able to give you that tailored advice. The reality is, any of these YouTube videos that I make or that anyone else make are inherently general in nature, I’m trying to make a video that appeals to the most people that can address the most common things that apply to everyone. I can’t sit here and make a video for just one person analyse their one property and hold their hand through that process. So that one on one support is just not something you’re gonna get from YouTube, from research from going around on Google on the internet, figuring that stuff out on your own. And the challenge is that the devil is in the details with these things you can make or lose 10s of 1000s of dollars on some of those nuanced things. So I just think it pays massive, massive dividends, I know it pays massive, massive dividends to work with a coach who can hold your hand. And that’s what you really want is you don’t want just some one size fits all, you know, Lesson Module of like a bunch of YouTube videos all in one place. Because that doesn’t accomplish it either. You need one on one coaching, you need support. And that’s exactly what we do is we help people one on one we hold their hand. So that’s something that you’re looking for. And you’re interested in investing in Airbnb and short term rentals and doing it successfully. And having literally a team of successful investors holding your hand and showing you the ropes every step of the way, so that your success is virtually guaranteed, then check out the link, let me know like get in touch with our team reach out to us because we would love to help you this is what we do. It’s what we love to do is helping other people be successful in this space. And I make videos all the time talking about how incredibly successful you can be with this, and how impactful it can be. And I get to see every single day, people posting in our community saying that they’ve got super low status, that their return on investment is incredible that they’re able to quit their full time job, they’ve replaced their income entirely. They have more freedom to spend time with their family more flexibility in their day to day, all these incredible things that can be created by investing in short term rentals and Airbnb ease. And so I’m a big, big advocate. And you can see that in all the videos I post. And I want to be rational but I want to do it the right way. Because as much as there is this incredible upside. There’s also downside if you don’t know what you’re doing and don’t do it the right way. And the worst thing to see is people that have that downside realise that, you know, saved up 10s of 1000s of dollars beyond $100,000 worked really hard for years to save that money up. And then they go and invest it and they make a mistake that sets them back another 510 15 years. And now it’s going to take longer for them to retire. It’s gonna take them longer for them to hit their goals. It’s gonna take longer for them to have something that they can actually pass on to their kids. And they may never do it they may get out of the market because they They think there’s just no way to do it because they did it wrong the first time. So be intelligent, be a good investor and do this the right way. Whether it’s me you work with or someone else I just highly, highly recommend getting that guidance that’s going to show you the ropes so you can avoid any of those mistakes and ultimately reach your goals a whole lot faster. So, I hope this video is really helpful. I hope this hope helps even just one person to avoid some of those fatal mistakes in their investing. And if you want to work with me and you want to work with my team, and have us be those guys that are gonna kind of shepherd you through the whole process, then just click the link down below, check out our free training, get in touch, we would love to work with you and we’d love to help you. All that said, I hope you enjoyed this video, I hope you got value from it. If you did press the like button hit like on this video. It really does help me out with getting these videos in front of more people in this one especially I want to get in front of as many people as possible. So just make sure you hit that like button give the video a thumbs up so more people can see this and avoid those mistakes. And also, if you’re new here and you have not yet subscribed to the channel, make sure you hit the subscribe button here. So you can stay up to date with the two new videos we do post every single week that are going to help you to perform really well on Airbnb. So with all that being said, thank you so much for watching this video and I’ll see you in the next one.