Short term IP rental club

I'm guessing these people must be paying down some big loans to better the cash flow? Or are yours still IO with offset

Also with all the competition do you get many price wars in the 'quiet times'

Or are there no quiet times :)
 
Hey Moneyman, naturally you can do either depending on your situation. If tax benefits are important to you then you can rush out and expand quickly keeping maximum leverage going or if you are after cash flow just pay down your borrowed amounts as much as you can to go as positive as possible.
Price wars not so much - the prices are pretty much set by all hotels so as long as you are on par you'll never have any issues. In Melbourne there are very few quiet times as there is always some conference, event, festival on at any time.
 
I did that too, but the building manager stopped me from doing it. Told me that the guests did not take care of the building, disturbed other occupier, etc which surprised me as my guests mostly seemed responsible.

Yes return is great....but tired of handling guest who expected treatment like a five star hotel, even though I charged them low.

Next time I'm doing it, I will engage management service, or maybe do a corporate lease. Anyone know how much is the agent management fee for this sort of lease?
 
Do your neighbors have any problem with you running short stay accommodation?

I remember reading last year that the City of Melbourne were attempting to close these types of accomodation options down. From memory it was one of the towers in docklands that was basically being used as a hotel. I feel sorry for the owner occupiers in the building.


Also read this article last week.

http://www.smh.com.au/travel/travel...or-as-squatter-takes-over-20140721-3cahg.html

What type of lease agreement do you enter into with your guests?
 
Hey Tep846, there are agencies that can manage this for you and they work in one of two ways:
- they take over possesion of your property and advertise on your behalf then look after guests when booked.
- they rent it out from you at a slightly higher rate and keep all profits from the operations to themselves.
I would not recommend either of these as you will miss out on 30-40% of your return, plus a lot of these agencies insist that you buy linen from them, wash it through them etc for an additional fee. Also you can say goodbye to you having posession of your property as they are ultimately in control. So in short, don't do it.

Where did you used to get your guests from? If you use something like airbnb you'll never have an issue as there is an open review system for both hosts and guests, which means if they have been behaving badly / loundly / expecting too much in the past this will be reflected on their profile and you can choose not to let them book. I say no to about 40% of enquiries based on reviews and ratings.
 
SOP - no issues from the neighbours, if the building has 200+ units, people come and go all the time.

Airbnb and stayz have good policies that protect both hosts and guests. As mentioned in the previous post you have the ability to pick who stays and who doesn't.

There is always a horror story out there to shake things up in any industry really, same as your normal resi rentals - you never really know what happens to you property while someone else is in there.
 
antistar said:
Where did you used to get your guests from? If you use something like airbnb you'll never have an issue as there is an open review system for both hosts and guests, which means if they have been behaving badly / loundly / expecting too much in the past this will be reflected on their profile and you can choose not to let them book. I say no to about 40% of enquiries based on reviews and ratings.
Click to expand...

Your rejection rate is huge! What's the most common reason you refuse bookings?
 
Ed Barton said:
Your rejection rate is huge! What's the most common reason you refuse bookings?
Click to expand...

Normally if there is no offline ID verified (passport, drivers license, etc) I do not allow them to book. An email and phone number is not sufficient. There also has to be at least one or two positive reviews from other hosts so I know that they are clean, quiet etc. I have pre-set some of these standards within the airbnb booking system so people without any reviews / offline IDs can't even apply and or contact me. The other thing is age - have never had any issues with middle aged couples (they are my fav types of guests) and wouldn't let anyone in their early 20s get near it. You learn as you go but there are good filtering systems out there to begin with.
 
Hi antistar

I have a 2 bed 2 bath Victorian cottage in Middle Park that I am considering letting through Stayz and Airbnb.

Can you advertise through both and how long did it take to build to a level more profitible than long term leasing?
 
Hi Turk

Took about a month to get right into it, learn how it works and generate the first few bookings. It's a good idea to go easy on the price for the first month until you get some bookings and good reviews.

You can certainly advertise on both sites as well as others that are available. Airbnb is fantastic in every sense of the word, they have a lot of traffic, smartphone app, calendar links with ical, you get paid very quickly etc. Stayz is a little bit 20th century at the moment but they are improving slowly.

Before you get started I would suggest going on airbnb and stayz and searching for similar properties in your area to see what's out there and how much they charge per night. You can also look up their calendars and see how many bookings they have got. Every area / type of property is different so just see how the others are doing first. All of the info (rates, calendars) is public so it's an easy way to do research.

Hope this helps
 
It's ok if you have just a few places. But when my portfolio (which is in the same area as you, CBD/inner city) grew to a certain number, it wasn't really worth the effort unless I did it full time. I probably hit this point when I was at around 8-9 properties.

I've still got my airbnb account up and my response rate has plummeted.
 
Ah you must be my competition!

At 9 properties without a doubt you would employ someone to run everything. Even after 3-4 of these.
 
I have found the thread very interesting.

I have two apartments in Melbourne that I rent out per night via Airbnb and Stayz.

Both apartments are in extremly good locations in the CBD and both are experiencing 95% capacity. I manage these myself and really enjoy it. For me it is a far better return than I would achieve on a 12 month lease.

Have never had an issue with guests.
 
Hi Everybody, loved reading these comments. I've just taken the plunge and listed my newly purchased apartment in inner city Sydney (Darlington near Redfern and Chippendale) on Airbnb. Response for New Years has been huge in just the first 24 hours! I will see how it goes. :)
 
Last edited:
Gockie said:
Hi Everybody, loved reading these comments. I've just taken the plunge and listed my newly purchased apartment in inner city Sydney (Darlington near Redfern and Chippendale) on Airbnb. Response for New Years has been huge in just the first 24 hours! I will see how it goes. :)
Click to expand...

No wifi?
I would have thought this is must, especially if targetting overseas travellers.

Anytime i travel overseas, if the accommodation doesn't have wifi, its off the list.
 
Response for New Years has been huge in just the first 24 hours! I will see how it goes.
Click to expand...

You would get a huge response if you rented out a tent in Darlington over New Years Eve.

Be discreet and try to not let your neighbours know what you are doing or you will have issues with the body corp and then the council. Join one of the Airbnb Sydney hosts group and you will see discussions about this.

Scott
 
depreciator said:
.

Be discreet and try to not let your neighbours know what you are doing or you will have issues with the body corp and then the council. Join one of the Airbnb Sydney hosts group and you will see discussions about this.

Scott
Click to expand...

Better still, let them know so there is no issues later. With airbnb you can pick your guests so avoid letting in party people / large groups at all times. 95% of mine are middle aged couples - not a beep comes out.
 
Better still, let them know so there is no issues later. With airbnb you can pick your guests so avoid letting in party people / large groups at all times. 95% of mine are middle aged couples - not a beep comes out.
Click to expand...

Depends on the building and the residents. It's often somebody else who is less cautious about who they rent to that causes the ball to start rolling on body corp/council action against short term rentals. From the chit chat on the Sydney Airbnb host groups, this is happening in mostly eastern suburbs buildings.
 
Thanks for your opinions folks! Re the wifi, I have been debating whether to include this... It's a maybe for now but I thought better to advertise no wifi first (under promise, over deliver) in case I decide to not provide it for whatever reason. Ditto laundry. I still have to furnish it so will need to pay a bit for that.

I have some WA acting folk possibly wanting to stay as they will be doing some rehearsals at Carriageworks... Fingers crossed that booking comes off as it looks like it would be a fairly solid booking of a good duration.

Yes, some concerns on whether I will have building/neighbour complaints or issues... I get ownership of it in 3 weeks time... Mortgage paperwork is ready...
Very exciting!

Ps. My 100th post! :D
 
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