#21 : Tales from Tech: Unique Airbnb Experience

 
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It’s time for the third episode in our miniseries about short term rentals - you can catch the first two episodes here and here. If you’re thinking about jumping into the short-term rental market, it can be useful to hear from someone who’s just taken that leap themselves. Today we’re lucky to have Skyler Whorton with us, because he’s recently become the owner and operator of a spectacular Airbnb himself!

Skyler Whorton is a software engineer by day and an aspiring vacation rental operator by night. He and his partner Madison are passionate about creating a unique travel brand and luxurious destinations for people to enjoy. Their short term rental The Ollie Scottsdale is a gorgeous property in Scottsdale, Arizona that has been designed to evoke a beautiful, restful, one-of-a-kind desert experience.

Skyler and I talk about why he and his partner decided to buy a short-term rental property and how this decision has played into their collective strengths and interests. Skyler tells us all about his property The Ollie and how he and Madison thoughtfully designed it to create a unique guest experience. We also talk about what they’ve learned so far, how they’ve selected products to feature at The Ollie, and how they’ve taken a different approach to managing their property.

In this episode, we’re discussing…

  • Why Skyler and Madison wanted to buy a short-term rental property.

  • What kind of analysis they did before selecting and purchasing the property that would become their Airbnb.

  • How they designed the space to evoke Arizona and the desert to provide an oasis for guests.

  • Why they decided to strike a balance between managing the property entirely themselves and hiring a property management company.

  • What they look at when pricing their property in comparison to others in the Scottsdale area.

Skyler’s Top Tips:

  • Consider what happens in your area and when - Scottsdale definitely has a high season for tourism, but there are fun events year-round that draw guests to the city. Consider the high points in your market’s year and whether you can find a property that leans into customer demand at those times.

  • Thoughtful design goes a long way – Skyler and Madison have been able to price their property a bit higher thanks to their compelling design and thoughtful details - and having a theme helps, too!

  • Ask brands if they want to work with you - many will be excited to be a part of your boutique short-term rental and will even give you hotel rates on products.

Resources:

 

+ Read the transcript

Nichole Stohler 0:01
What if you could be doing something smarter with your money that creates income right now? If you're an IT professional who is wanting to get ahead financially and enjoy greater freedom of choice, and if you wonder who else in tech is creating ways to make their money work for them? You want actionable ideas with honest pros and cons and no fluff. Welcome to The Richer Geek Podcast for helping IT professionals find creative ways to build wealth and financial freedom. I'm your host, Nicole Stohler and in this podcast, you'll hear from others who are already doing these things and learn how you can too.

Welcome back to The Richer Geek Podcast. Before we get into today's episode, just a quick note. If you're listening to the episodes around short term rentals, and you think "that's kind of interesting and could be pretty cool," but you don't really want to go find a property, get a mortgage, furnish the property, find property management, make sure you're promoting the property on social media, all of those pieces - if you don't want to do it yourself, and you want a just a passive investment, we have opened up a fund for a new hotel project for accredited investors. We're very excited about this particular project because of the location and the purchase price because there's a lot of reasons behind why we were able to get a good deal on this particular hotel. You can check out the details at therichergeek.com/invest. Alright, moving into today's episode, this is our third in a multi part miniseries around short term rentals. And this episode builds on the information that we already talked about in the previous two episodes, including what do you look for in a short term rental, giving the property a unique name, making sure you have Instagram where the pictures and then we also talked about design elements? How do you make sure that you have really put the right kind of design in your property so that you get more bookings. Today's guest is Skyler. Skyler is a software engineer recently purchased his first short term rental along with his partner Madison. What I really like is they've taken a unique approach and built upon some of the tips that we've had in a couple of our other episodes. And because Skylar has just gone through that experience of getting a property up and running, I'm thrilled to have him share what that all has been like. scalar Welcome to the show.

Skyler Whorton 2:30
Hi, thanks, Nichole. Thanks for having me on.

Nichole Stohler 2:33
Tell us - let's jump right into tell us your reasons for buying your first short term rental.

Skyler Whorton 2:40
So it has been a combination of our interests and strengths and just by the way, when I say our are we are us, talking about myself and my husband, Madison, so we are a partnership in this. So the first item is we love creating stylish, fun and thoughtful spaces that stand out our homes. When we put our home together, we love using colors and interesting furniture, and all kinds of interesting design elements. The next piece is we love to host and share that with people that we love. So we love having our friends and family over our neighbors we like to host and throw parties. We love to share all that design with everyone and really enjoy the space that we live in. When our friends come to visit, they say stuff like this just tickles us. We we feel like we're staying at resort. This is such a such a fun place. So then we're not comes together as we love to travel. And we've been to some short term rentals. Some of them are great. Some of them are not so great. And when we go to the not so great ones, we say to ourselves, gosh, we feel like we could probably do this better. This doesn't seem that hard. Like, what's what's holding us back from this? And that's what got us interested in looking into the possibility.

Nichole Stohler 3:49
I love that you're combined your interests and your passions, and then the other pieces. You're looking at the business model and saying we could improve on this potential killer model and and probably be very successful at it. I know it's all fairly new but it's such a great combination of bringing those elements together. Now you took a differentiated approach you and Madison around this short term rental. Tell us about your focus in the name of the property and those types of things.

Skyler Whorton 4:18
Sure. So for those who don't know, Scottsdale Arizona, is a really popular travel destination for a lot of different reasons. beautiful weather, lots of events, lots of different people come and travel year round for events, work conferences, all kinds of fun stuff, too. So the short term rental market is also very saturated. So we knew that we needed to stand out from the crowd. So we wanted to create something really unique that people would remember something that would strike people as unusual. And our focus has been on creating a space that reflects the things that we love most about Arizona, the things I kind of mentioned, the natural beauty, the wildlife in the area, the history of the area, kind of a lifestyle here things things that we really enjoy about living here, we want to share that with other people.

Nichole Stohler 5:01
So you are looking - you wanted to create something unique, something different. And then you went a step further and you named your house and I'd love to have you kind of share a little bit about that.

Skyler Whorton 5:13
Sure. So our vacation home is called the Ollie. And we talked a lot about the name and really, it's pretty simple. The property that we purchased has this amazing backyard that we love, and the whole perimeter back perimeter is a big wall of oleander trees which are very shabby, bushy tree, probably 10 feet tall and they make these beautiful, white or pink flowers. So we just shortened oleander to Ollie. And that's what we got.

Nichole Stohler 5:43
Love it. Now, how did you decide you know, I don't know if you already had planned a look at Scottsdale but how did you actually choose the location and the specific home? What were you going for?

Skyler Whorton 5:55
Yeah, so Scottsdale because we live pretty close. We figured something close by would be good for our first venture into this. This is our first kind of trip into real estate investing or a certain niche of it. So something we could get to if anything went wrong. It happened that Scottsdale is a great market for that kind of thing. So it made sense. So as for what we were looking for, we knew we wanted a single family home with three more bedrooms. And the reason for that is really specific, setting up space and privacy that appeals to groups of people. And it's immediately different than the product that a hotel often offers, which is one bed or two beds or media suite, if it's a really fancy hotel, they might have a bigger suite. But we're immediately no longer really competing with people that are just renting a hotel room for a couple of nights for themselves. So we went shopping and kind of iterated on our ideas a little bit. We finally found a home that had a lot of character on the inside some interesting architectural elements, good bones, it was in good shape, and had a really remarkable outdoor space that I started to describe and we knew that would be really important to the experience that we wanted to build - most importantly, when we walked in and looked at it, it gave us a feeling like we think this is the one we think it's going to work, which is maybe buying with emotion, but it also made us feel good about the decision.

Nichole Stohler 7:09
So you talked about the emotion, which obviously a you are trying to create an experience. So that is important, at least in this particular niche within real estate investing. What kind of analysis did you do when you were looking at numbers?

Skyler Whorton 7:22
Yeah, we certainly looked at what other rentals charge what hotel was charging the area. And since Arizona is such a seasonal market, also at different times of year, we compare that with home prices and thought, Okay, well, if we take out a mortgage for this much and our rents are this much, and we think our expenses are going to be in this kind of ballpark. Like what does that look like for us? It's a lot more than that went into it, but we built out kind of some pretty rough but still detailed and like honest spreadsheets like if we're budgeting conservatively. This is how we think will come out, looked at return on investment rates, given those numbers, and we tried to run through that analysis for a lot of different properties on the MLS. And then, of course, apply that to the one we ended up purchasing. So we're able to justify that emotion with like, and we think it can make sense.

Nichole Stohler 8:15
Definitely a lot of analysis that went into it sounds like especially because you have to in a seasonal market like Scottsdale, you have to run so many of the different numbers, because and so you're not looking at like a flat rate just makes everything a lot more complicated to look at. What was involved in getting the home ready?

Skyler Whorton 8:35
So in addition to some of the things you might expect, like you know, where the repairs needed, the types of things you do for a long term rental, I would imagine, so the garage needed finishing, so we added drywall in the garage. But it really was more than that. I mean, I'll go ahead and say it we are pretty particular people we're pretty picky. We know that we have a high standard for things. We wanted the place to feel like someplace we would be excited to go and stay on vacation. So that was kind of our guiding light for all of our products around the around the house, everything that we did. So we made the design the way we like to imagine ourselves living there imagined ourselves hosting people. And in addition to that, we built some relationships with different tradesmen and vendors that were going to help us run it. So we got a great pool person and a great landscaper and people that we knew we could trust to keep things looking a way we would expect it to. And the kind of cap on all of that was when we were really putting the finishing touches on actually going and staying there ourselves and imagining ourselves being on vacation here, spending nights there and using all of the appliances and fixtures and realizing firsthand what would bother us and what we needed to fix or improve on.

Nichole Stohler 9:50
It was a test run.

Skyler Whorton 9:52
Yeah, absolutely. And we made up some of our friends and family do the same thing. We sent them there with some friends and had them stay and ask them as politely as we could, like, Please be honest with us, you know, don't don't hold anything back, tell us what you thought or fix. What a great way to do some kind of informal research and make adjustments, you know, just little things. And maybe one of the beds isn't comfortable or whatever it is. So that's, that's a great idea. Yeah, it worked out really well. And you know, my partner and I have a certain experience, but we are very similar in a lot of ways. And we knew that we needed different perspectives to come in and tell us, you know, things that we wouldn't have thought of, or amenities they would have enjoyed or things they would have done differently and it really paid off.

Nichole Stohler 10:37
And for those listening, what you're hearing is Skyler describing really creating experience, but also like a like a boutique hotel is what it sounds like, to me. It's just, it's not your standard short term rental, and it's much more of curated, especially when you when you look at the website, and you see this, you'd be amazed at how Arizona specific and very thoughtful, all of the decorating and just the aesthetics and the finishes are. And you've taken a unique approach with local partnerships to support this branding and this experience. Can you share a little bit more about that?

Skyler Whorton 11:18
I was so happy to hear what you just said. Because my answer to that is we were going for something that would really feel like an Arizona experience. We wanted people to feel like they were experiencing the desert, experiencing what Scottsdale was, that was guiding us there. We found some local brands whose products we really liked. So whether that was the coffee or the lotions, the hair products, things like that. So we use those things ourselves. We'd like them. They weren't the cheapest things. We didn't go to the target travel section and pick the tiny travel size shampoos and decide to save a buck there. We really kind of splurged for something that people would really enjoy and find remarkable. But the thing is, when we approached those brands and just said "Is it okay If we use these products? We're building the short term rental business, we want to feature you like, Is there a way we could get some wholesale pricing on some of these things?" You'd be surprised at the response that we got if you just ask people and let them know that they're going to be a part of your your business and your brand. People get really excited about that. So we had a lot of success with that, and and built some really, really good partnerships that way.

Nichole Stohler 12:23
And do you call that out specifically when people come and stay so they can know that those are Arizona products specifically?

Skyler Whorton 12:32
We do in every bedroom, we have a little card with a QR code and or you can type in the site and say, Do you like these products? Here are links where you can go and buy them online or find their stores in Arizona.

Nichole Stohler 12:43
Very cool. And only someone in technology would have a QR code. Okay. So tell me what your plans are for managing the property. How are you looking to handle that?

Skyler Whorton 12:55
Sure. And maybe for your listeners who might not know as much about it yet, maybe we'll explain like kind of two schools of thought or two extremes on the spectrum of how to do this. One extreme is you decide, I have the time and the energy and the interest. And I want to do everything myself. So I'll take care of all the marketing, staging the home, taking the photos, putting up the listing, talking to all the guests that asked me about the place answering questions, set everything up between each day, I'm gonna be the one who picks up the phone, maybe I go and meet people in person, I'll go and clean it after they leave and everything, a lot of work, but maybe you decide, you know, if you're into that kind of approach, a higher cleaning company and outsource that maybe there are other little pieces that you outsource. But my main point in describing that is you are always there. The other extreme of that is you get a professional management company, especially in Scottsdale and I think other popular tourist destinations. I think there are a lot of property management companies that specialize in short term rentals, and they do all of that. All of those things I just described. You turn your property over to them, and they handle all those things for you. And they just send you a check at the end of each month after they've taken their commission out, which could be, in my experience between 20 or 30% of your bookings. And then all you worry about is taxes at the end of the year. And unless there's some big emergency, like your house is actually on fire, heaven forbid, you'll never get a call from any guests or anyone about any problem. So for us, we didn't fit into either of those two extremes, because we knew that I mean, I already mentioned one of our passions is travel, we still wanted to be able to leave the state and have our business continue on without us. So we needed to find someone we trusted to be there in person, every time and if there are any issues that came up. But on the other hand, we didn't want to go full property management because there were some parts of the business that we really loved. We loved building our brands, we love that marketing, we love doing the social media. Sometimes we like you know, talking to guests, when they're, you know, when they're having a good experience and want to tell us you know, what's been so great and all that or if they want to know where the where they can find the coffee that we stock or whatever. So why would we pay a full service property management company to do all those things that we love doing and that we think we are adding value to the business by doing. So the challenge for us was finding somewhere in the middle someone to worry about the things at the property, and managing the business day to day but letting us kind of provide value on those other things. And where we landed with that was trying to find a professional co host type of person to fit that specific set of requirements.

Nichole Stohler 15:31
Tell us a little bit about the professional co host because I think that's an industry in itself as well.

Skyler Whorton 15:37
I'm guessing so but for us it was it was actually kind of an interesting challenge to figure out that's what we wanted and that the type of person that was out there. There's a there's a good book that my partner read and kind of summarize for me called the abundant host. We don't have any affiliation with them, but we got a lot of inspiration about like finding this person that you develop this relationship with. They kind of become part of your business, you're trusting them with a lot. And they're also kind of relying on you to. I mean, they want to feel empowered. They want to feel like they're part of it, they can make decisions, they can really take ownership of the guest experience. And there's actually kind of difficult to find that that type of person.

Nichole Stohler 16:17
How did you find that person? And how did you vet them?

Skyler Whorton 16:20
Yeah, we first looked at our networks, we know some people that could potentially have filled that kind of role. We didn't find like a lot of interest out there. So we moved on to kind of other channels. We posted a job description on indeed, and kind of went through that a little bit didn't really find exactly who we're looking for. We've also thought about like other people who are in the gig economy, like, if their schedule is very flexible, and they have the right interests and skill set, maybe that's something that type of person would be really into. And we didn't really find much there either. So the next thing we tried was going on to some online communities so Airbnb for Facebook, and ended up being on a Facebook group that I found, which by the way for your listeners, I discovered through this process that Facebook, whether you love social media or not love Facebook or not, it's a really great resource for finding like minded people about almost any topic in almost any specific geography you want. So I literally typed in, I think like Phoenix, Arizona or Scottsdale, Arizona, Airbnb, and I found like three groups. So I joined them all and you know, asked my question looking for this type of person. And from those responses, we found the candidate that we ended up kind of hiring to manage this for us.

Nichole Stohler 17:35
Now, we talked about that we have a seasonal market here in Scottsdale, lots of fluctuation, how do you manage and decide on rates because to me, that seems overwhelming with all the changes that could happen.

Skyler Whorton 17:50
So there are a couple kind of parts to our strategy, and there have been different phases of our of our business already in this really short time. So the first thing that we had to do was we determined in pretty great detail what our breakeven price point was for this day, given you know, if a group used every single thing that we offered because we put out a lot of amenities, different snacks, beverages, all the consumables, if they use every single bed and use every single towel that we had to wash and pay for that, what does that dollar amount What does that cost us and in general, we don't price below that ever. So we would sooner leave the home begun for however many nights rather than go with a state that only netted us this much because we we wouldn't make any money off of it. The one exception to that was at the very beginning. We made a play to get the reviews that we needed on Airbnb. In order for on that platform, your rating to show up in search results. You need at least three reviews from guests that have stayed there. So Airbnb in particular is getting into the weeds they offer. You can set up a promotion that shows up on the Airbnb platform and they say, hey, this host is offering a discount their rate would normally be 20 percent more, but because their new like, here's your chance to get a good deal on it. In general, we don't feel like we need to devalue our listing in order to get a booking, we feel like what we're offering is really unique and different. So that was really an exception for us to say, you know, we know we're new, like we have no reputation. I think this is how a lot of people shop. If you see something that has no ratings and reviews, no one's vouching for it. It's a real listing, do it? I mean, do I really take the chance or not? So that was important to us that was worth taking the loss, honestly. So then after that, I mean, we're through that point. Now we have our reviews. We talked about this pretty regularly. So we look at not only what our other Airbnb is charging around us and our neighborhood, also what hotels are charging, and we don't necessarily try to undercut but we kind of want an idea of seasonally What are people paying to come here and stay here. The other thing that we look at is the timing of events and holidays that bring travelers to the area and we know that we can charge when demand is higher during those times, and you're doing this on your own, you're not using any kind of software to automate that or you haven't tried any software yet. And if you use Airbnb as a host, they will make suggestions that are not necessarily explained in great detail. So they might say, Oh, you should consider charging this much less for your property. And if you think about that, from an adversarial standpoint, Airbnb has an incentive to get someone to book your place rather than it staying empty because they get 3% of your gross rents when someone books your place. So they may think that you're charging too much for me that they may not know. They may have an algorithm that says, Why don't you lower your prices a little bit and get someone to stay there but knowing that we kind of don't pay that much attention to it. So some third party pricing software may do a better job of that, depending on how they work, but we don't have any experience with that yet.

Nichole Stohler 21:00
So you're, you're watching and monitoring... It's a lot of factors. It's a lot of pieces. But it's good to know that you've, you've got your breakeven. And I think that's really smart too, because you're not just trying for a booking and I think part of it is so different in your approach, because you are providing all those other amenities that then cost money, interesting approach.

Skyler Whorton 21:24
And the spoiler alert on that is they will if you put something out, people will take it, even if you didn't expect them to take it, they will take the entire bowl of Starburst and do I don't know what with them, but it wasn't really meant all for them, but they took all of them. And that's not a very expensive one to replace. So that was fun. Oh, that is hilarious. So that so that kind of leads me into the next question, which is how has the overall experience been and what what are kind of the pros and cons that you've seen people stealing your Starburst, but what else? It's been really good validation that the things we care most about, which was the design of the place, the experience seems to really resonate with people. So the public review comments that we've gotten, also privately, people telling us how much they enjoyed it, how everything was thought of and taken into account. So that really tells us that what we've created, on some level has done what we wanted it to it's, it's succeeding in that way. The guests that we've had stay there are by and large, very, very respectful, very positive. And I think there was only one instance so far, someone who was a little untidy, and kind of left things where we needed to do a little bit of maintenance that we wouldn't really need to do. But we kind of are just taking this a learning experience where when someone you know, isn't as careful in your rental as you would be in your own home. You can't take it personally, right? If we did, we would spend all of our time worrying about it and being afraid of what people are going to do to it. So on that note, we do have some policies that we enforce I guess so in the Airbnb platform, you can set up instant booking or not, and instant booking says if guests meet your qualifications that you list out. And there are few options you can pick from. They are allowed to like click one button and there stays reserved, done. And the options you can pick for vetting your guests are, do they have a government ID uploaded to the platform? I don't ever see their drivers license or whatever. But I know that Airbnb has it. So they verified you are who you say you are. And you can also say, I want another past Airbnb host to have said, this is a great guest, I totally recommend them. They're Welcome back. And if they need both of those conditions, they're free to book. Otherwise, they have to send us a request and say, Hey, you know, I want to book your place, but they need us to sign off before we allow them to and what we do in that case is we just say, Hey, we have this policy like, can you please upload your ID and I'm sorry, but since we haven't stayed in Airbnb before and had a host review, we can accept your request at this time. And our hope is that we may turn away some bookings but will also avoid any one that we feel is a risk to our property or our business, which is really pretty... right now because of how much Airbnb spent in the news, even in our area to avoid those situations.

Nichole Stohler 24:06
What would you say has been the most challenging part of the overall process?

Skyler Whorton 24:11
We have had experience with a lot of different sort of pieces. Like I mentioned, you know, we love design. We have bought a home before we've gone through all the mechanical sort of steps of that dealing with contractors, the thing that was newest for us, and maybe most challenging was kind of the process I described about finding that co host, because for the way we're structuring our business, it was so important to have someone we would trust basically, unconditionally with our property and our reputation, really in our brand. And I feel like we got really lucky like we could have gone through some iterations with different folks. But the process that we sort of figured out, we didn't really know how to find this person, and just making sure that we really held off for the right one. It could have taken a lot longer, but it worked out pretty well I think.

Nichole Stohler 24:56
Well, I would love for listeners to know where to find out more are about the Dllie, where should they go?

Skyler Whorton 25:03
Great. So we are called the THE OLLIE, Scottsdale. And our website is theolliescottsdale.com/therichergeek. And you can also find us on Instagram.

Nichole Stohler 25:20
Fantastic. Thank you so much scalar for coming on sharing your story giving some of this detail and advice. Really appreciate and look forward to seeing more great things from the Ollie.

Thanks for tuning into The Richer Geek Podcast. For today's show notes including links and resources, visit us at therichergeek.com. Don't forget to head over to iTunes, Google Play stitcher or wherever you get your podcasts and hit the subscribe button. help us spread the word by sharing with others who could benefit from listening and leave a rating and review that'll help us get the podcast in front of more people, I appreciate you. Thanks so much for listening

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SkylerWhorton.jpg

ABOUT SKYLER WHORTON

Sky is a software engineer by day and an aspiring vacation rental operator by night. He and his partner Madison are passionate about creating a unique travel brand and luxurious destinations for people to enjoy.



 
 
 
Rental Properties, Vacation RentalsNichole Stohlerpodcast, season 1