Should Agents Own Rental Property and Vacation Rentals?-with Avery Carl-EP108

During this episode of the Lab Coat Agents Podcast, host Jeff Pfitzer speaks with Avery Carl, who bought her first vacation property at the age of twenty-six on just a $37k per year salary. Now, she’s a millionaire in her early thirties by taking her first-class ticket into the real estate market provided by her knowledge as an agent! Episode Highlights:  Avery grew up wanting to be a rockstar and worked in the marketing side of the music industry for a few years after school. It didn’t take long for Avery to figure out that she was a terrible employee and bought a rental property in Tennessee to start a side business. In the Smoky Mountains, Avery discovered a decades-old vacation rental property gold mine. With a husband that mirrored a terrible client, Avery got her real estate license and began building her empire. In less than six years, Avery went from one rental property to a portfolio worth multiple millions. When it comes to short-term rentals, focus on areas that are weekend spots just outside of your metro area. Every town has something to offer as far as great real estate investments, you just have to find it. True-vacation markets run the risk of not being able to convert short-term rentals into long-term in case of emergency. Many agents make the mistake of automatically referring out vacation markets that are more than an hour away. Agents who do not have the time to drive three hours to a property can hire showing agents. Online data is available for all agents, though Avery found her ideal locations via in-person experience. Depending on asset class and the distance an agent is willing, agents can choose the best investing locations for them. In vacation areas, during times of distress, you will see people sell off their investment properties and vacation homes before things get to their primary home. Mature vacation rental markets have normalized renting privately-owned properties over hotels. Avery recommends a mix of Airbnb and VRBO as platforms to market short-term rentals for investors. Financing options include putting 20% down with a normal loan, 10% down vacation-home loan, and Host Financial specialty loans. Host Financial lends on the potential income of short-term rental properties for both individuals and LLCs. Managers for short-term rentals charge about 25% of gross income which is much higher than long-term rentals. Most people that Avery knows in the short-term rental space self manage in order to build a solid portfolio. Fixing mishaps in your property is the same whether you are two miles away or two thousand miles away. Expectations for repairs are ASAP for emergencies and whenever help can get out for other problems. Expressing the income as a percentage of the purchase price is the deciding metric that Avery uses to evaluate a property. Utilize the Enemy Method and look on rental platforms to see what other properties charge in the same neighborhood. Get as many data points as you possibly can in order to make the best property evaluation possible. Management companies are willing to share data and metrics about properties in their area because they want you to hire them. Many agents live commission to commission, making it important to set up a source of secondary income. 3 Key Points: Investing in real estate is almost like insider trading for agents because they can build a passive stream of income with the knowledge that they’ve acquired through their work. In mature markets, it’s a norm that people rent private properties rather than hotels, as compared to a young market that does not accommodate short-term rentals. In order to self-manage, investors will have to communicate via their platform of choice and will not get as many late-night calls as is commonly assumed. Avery suggests establishing relationships with local repair services. Resources Mentioned: Lab Coat Agents | Website| Facebook |Facebook Group| Twitter | Instagram | Avery Carl  | Website| Facebook | The Short Term FB Group | Host Financial Chime (sponsor) LinkU (sponsor) LCA Marketing Center (sponsor)