HORROR Story: How This "Perfect" STR Cost Him Big...: täielik transkriptsioon

back West. 66 00:03:59.310 --> 00:04:04.374 So when I started thinking about short-term rentals, my first choice was the Mountain Markets. 67 00:04:05.034 --> 00:04:09.958 But of course, by 2022, COVID had been around for a couple of years by then. 68 00:04:10.578 --> 00:04:16.321 And everybody, once their boss told them, I don't care where you work, you know, you don't have to come to the office anymore. 69 00:04:16.841 --> 00:04:21.983 The mountain markets have never been inexpensive, but they just got stupid. 70 00:04:22.103 --> 00:04:31.067 But thanks to the Vodesee playbook, I was able to run the numbers in a smart way and figured out the math doesn't math. 71 00:04:31.667 --> 00:04:36.330 There was no way I could make the math work in those markets, which was my first choice. 72 00:04:37.070 --> 00:04:39.692 So I really, I tore apart Steamboat Springs. 73 00:04:39.732 --> 00:04:42.813 I tore apart Breckenridge, a couple of my favorite places. 74 00:04:43.474 --> 00:04:45.175 Yeah, again, the math just couldn't math. 75 00:04:46.493 --> 00:04:56.858 So I switched to plan B, which was something else that I knew a little bit about because I'd been to the bourbon trail maybe a half dozen times in my life. 76 00:04:56.898 --> 00:04:59.159 Always enjoyed it as a tourism experience. 77 00:04:59.900 --> 00:05:04.442 And so I started looking into the Kentucky bourbon triangle market. 78 00:05:05.122 --> 00:05:06.123 Found Bardstown. 79 00:05:06.143 --> 00:05:09.127 I really didn't know that much about Bardstown before. 80 00:05:09.267 --> 00:05:10.128 I knew Lexington. 81 00:05:10.168 --> 00:05:11.250 I knew Louisville. 82 00:05:11.690 --> 00:05:14.393 Didn't really know Bardstown all that well. 83 00:05:14.413 --> 00:05:16.776 And found a good realtor in that area. 84 00:05:16.996 --> 00:05:23.905 And we went, you know, looking around and found, you know, what we thought was going to be, you know, the ideal property for a short-term rental. 85 00:05:24.728 --> 00:05:25.008 Awesome. 86 00:05:25.128 --> 00:05:25.828 That's awesome. 87 00:05:25.908 --> 00:05:27.329 And you're so right. 88 00:05:27.369 --> 00:05:28.609 I live in the mountains in Utah. 89 00:05:28.629 --> 00:05:29.790 I love the Intermountain West. 90 00:05:30.150 --> 00:05:39.913 And it is just one of those markets that as much as people love the mountains, as much as we have visitors here, that acquisition cost is so high that it makes that ratio of... 91 00:05:40.533 --> 00:06:05.212 our debt service and our holding costs and all that things that we have to have as far as expenses on a property versus the revenue that it can generate that is not real favorable in our especially where interest rates and prices are at right now and it's just it's one of those markets that is really really tough to great property breaks even right and it's and so you're you're just i love the mountains as well and it's but they're hard to make work on a short-term rental pro forma right and so 92 00:06:05.872 --> 00:06:11.556 Still went in though to, you know, another market, like you said, plan B, the Bourbon Trail, something that I love as well. 93 00:06:11.576 --> 00:06:14.698 I've been out to that area and kind of figure out that triangle. 94 00:06:14.718 --> 00:06:19.341 And when I went out there the first time, that's a fairly large area, right? 95 00:06:19.381 --> 00:06:24.424 The Bourbon Trail Triangle is a pretty dang large area and you're covering a lot of different ground and area. 96 00:06:24.464 --> 00:06:26.225 And so you chose Bardstown. 97 00:06:26.466 --> 00:06:29.027 And so talk to me about the property condition. 98 00:06:29.047 --> 00:06:30.488 A lot of these properties are older, right? 99 00:06:30.508 --> 00:06:32.409 When we buy them, I don't know if yours was. 100 00:06:32.530 --> 00:06:34.431 And so there's some things you're navigating, right? 101 00:06:35.412 --> 00:06:36.933 There's old and then there's old. 102 00:06:37.434 --> 00:06:38.955 Yeah, exactly. 103 00:06:39.215 --> 00:06:43.219 So the property we found was in a historical district of Bardstown. 104 00:06:43.239 --> 00:06:51.066 And one thing that had really going for it was walking distance to the central part of town, walking to the restaurants, walking to the shops. 105 00:06:51.426 --> 00:06:53.308 And there weren't a lot of choices in that. 106 00:06:53.908 --> 00:06:57.291 And that property is called the Bard House in Bardstown. 107 00:06:57.832 --> 00:07:01.295 So a family member that the town got named after 108 00:07:01.955 --> 00:07:04.557 back in the 1700s, lived in this house. 109 00:07:05.098 --> 00:07:09.001 The house was constructed roughly between 1790 and 1800. 110 00:07:09.021 --> 00:07:09.382 Wow. 111 00:07:10.983 --> 00:07:12.805 Now, you would never know that now. 112 00:07:13.606 --> 00:07:16.648 The guy I bought it from had just spent two years. 113 00:07:17.289 --> 00:07:19.631 It had not been lived in for more than 10 years. 114 00:07:20.171 --> 00:07:21.833 It was in horrible shape. 115 00:07:22.928 --> 00:07:23.949 Inside, outside, everything. 116 00:07:23.969 --> 00:07:26.910 It had just been like left alone for a long period of time. 117 00:07:27.391 --> 00:07:31.933 So he spends some hundreds of thousands of dollars and two years of his time. 118 00:07:31.953 --> 00:07:32.974 He's a do-it-yourselfer. 119 00:07:33.434 --> 00:07:35.876 And he brought everything back up to modern standards. 120 00:07:35.976 --> 00:07:47.823 New plumbing, new electrical, changed the inside a little bit and really gave me a clean slate to start imagining what this could be as a short-term rental. 121 00:07:48.283 --> 00:07:53.146 So when my realtor and I walked into it the very first time, all we saw was potential. 122 00:07:53.687 --> 00:07:57.069 It had that nice combination of modernization. 123 00:07:57.089 --> 00:08:02.553 You know, the kitchen is very modern and beautiful, but you're in a 226-year-old house. 124 00:08:03.734 -->

00:08:07.156 And you can see the bones of the house in that way. 125 00:08:07.216 --> 00:08:08.237 So it was just this nice... 126 00:08:08.997 --> 00:08:15.065 juxtaposition of new and old and in the right part of town, et cetera. 127 00:08:15.106 --> 00:08:20.112 So yeah, I got to start with a very clean slate, 3,000 square feet, completely empty, 128 00:08:21.397 --> 00:08:25.279 I'm living four hours away and I've got to set this thing up, right? 129 00:08:25.639 --> 00:08:26.379 Yeah. 130 00:08:26.439 --> 00:08:32.282 So that was the first hill to climb after getting through acquisition and permitting. 131 00:08:32.602 --> 00:08:34.743 And we can talk about that too, if you want, because that... 132 00:08:34.763 --> 00:08:35.583 I'd love to, right? 133 00:08:35.663 --> 00:08:43.667 Because that's absolutely, as we go through that permitting process, and you said it was in a district, a historical district, close to everything. 134 00:08:43.767 --> 00:08:46.088 But yeah, walk me through, because right then, 135 00:08:46.628 --> 00:08:53.014 That was really the year, late 2022 and 2023 were really the year of those sweeping regulations. 136 00:08:53.034 --> 00:08:54.736 So were you dealing with some of that? 137 00:08:54.856 --> 00:08:56.237 Are you currently dealing with it? 138 00:08:56.297 --> 00:08:57.198 Has they settled down? 139 00:08:57.379 --> 00:08:58.720 Walk me through a little bit of that. 140 00:08:59.085 --> 00:09:00.045 Okay, yeah. 141 00:09:00.265 --> 00:09:07.588 So we got our sights set on this property, got in contract with some contingencies around permitting. 142 00:09:08.608 --> 00:09:11.389 We needed to make sure everything was actually going to get approved. 143 00:09:11.750 --> 00:09:17.832 Being in the historical district added a few extra hoops to jump through, but I had to go to some town meetings. 144 00:09:18.032 --> 00:09:21.673 I had to go to a historical district committee meeting. 145 00:09:22.393 --> 00:09:23.574 I really felt like 146 00:09:24.394 --> 00:09:34.079 Bardstown, because I had already heard all the stories of some, especially in smaller towns, they just let the horses out of the barn way too fast, way too much. 147 00:09:34.099 --> 00:09:42.083 And then they were dealing with all these unintended consequences around their school systems and property taxes and all that, you know, all that stuff. 148 00:09:42.483 --> 00:09:47.126 Anyway, I really felt like even though Bardstown was making me and everybody else jump through a lot of hoops. 149 00:09:47.746 --> 00:09:49.068 They were doing it responsibly. 150 00:09:49.328 --> 00:09:56.219 And I thought, well, if I'm going to be an owner in this market, I actually like that it's not getting oversaturated. 151 00:09:56.259 --> 00:09:58.262 They seem to be doing the responsible thing. 152 00:09:58.322 --> 00:10:01.386 Short-term rentals couldn't be within 500 feet of each other. 153 00:10:01.406 --> 00:10:02.468 That was one. 154 00:10:02.608 --> 00:10:02.788 And... 155 00:10:03.709 --> 00:10:06.393 Things around ratio of parking spots. 156 00:10:06.413 --> 00:10:08.675 You weren't allowed to let people park on the street. 157 00:10:08.735 --> 00:10:10.798 You had to provide off-street parking. 158 00:10:10.818 --> 00:10:14.623 So I had to build a four-car parking pad. 159 00:10:14.943 --> 00:10:17.766 So everything seemed reasonable. 160 00:10:18.267 --> 00:10:23.333 Yes, it took time, it took energy, it took money, but it all seemed pretty reasonable. 161 00:10:23.854 --> 00:10:25.215 And, you know, we got approved. 162 00:10:25.375 --> 00:10:26.576 Everything was green light. 163 00:10:26.896 --> 00:10:37.683 And once I got past all that and had all my permits in place, then it was really about getting this empty 3,000 square foot historical home set up. 164 00:10:37.803 --> 00:10:40.685 So I was driving down from central Ohio. 165 00:10:40.865 --> 00:10:42.206 It's four hours each way. 166 00:10:42.666 --> 00:10:47.830 I was driving down every Sunday night and coming back on Thursday night for four months. 167 00:10:47.850 --> 00:10:48.470 Wow. 168 00:10:48.610 --> 00:10:49.271 Oh, wow. 169 00:10:49.331 --> 00:10:49.652 Jeez. 170 00:10:50.092 --> 00:10:50.833 Yeah. 171 00:10:50.853 --> 00:10:51.915 That's a lot of work. 172 00:10:52.395 --> 00:10:55.960 It really was a full-time job making all those. 173 00:10:56.000 --> 00:11:00.085 There's hundreds and hundreds of decisions, you know, the shopping, the 174 00:11:00.842 --> 00:11:12.426 the placing orders, the receiving items, unpacking and building things, disposing of all the packing material, it's hugely time consuming. 175 00:11:12.606 --> 00:11:13.806 Not to be underestimated. 176 00:11:14.347 --> 00:11:14.847 Yeah, right. 177 00:11:14.967 --> 00:11:17.708 I always, I talk about that setup phase is, 178 00:11:18.788 --> 00:11:19.088 It is. 179 00:11:19.669 --> 00:11:21.030 It's just grueling, right? 180 00:11:21.130 --> 00:11:22.611 And you're in a rush. 181 00:11:22.651 --> 00:11:27.394 It's like a sprint because you're like, I need to get this done as soon as possible because all I'm doing is spending money. 182 00:11:27.554 --> 00:11:29.075 All I'm doing is spending time, right? 183 00:11:29.135 --> 00:11:31.816 And it's like money's going out, time's going out. 184 00:11:32.457 --> 00:11:33.878 And there's so many... 185 00:11:34.738 --> 00:11:50.387 unexpected things that you run into as much as we kind of try to prepare ourselves for it, the amount of boxes that you have, the amount of disposal of items and boxes and packing material that you have when you're setting up these properties, it's mountains of it, right? 186 00:11:50.427 --> 00:11:52.808 And you just don't think it's that big of a deal. 187 00:11:52.848 --> 00:11:54.649 It's not like you can just go fill the garbage can up. 188 00:11:54.690 --> 00:12:00.173 You literally have to plan for trips to the dump and making sure you have trailers and trucks to haul it,

right? 189 00:12:00.213 --> 00:12:02.194 It's crazy amounts of things that you just... 190 00:12:02.655 --> 00:12:06.491 That's not counting putting it all together and placing it all and all that stuff, right? 191 00:12:06.511 --> 00:12:07.757 Yep, yep. 192 00:12:08.748 --> 00:12:14.609 But we used, well, we used Jeff Chisholm to help with, you know, getting the right mortgage product. 193 00:12:14.629 --> 00:12:15.710 The financing. 194 00:12:15.890 --> 00:12:16.790 Yep, the financing. 195 00:12:16.830 --> 00:12:20.871 This was a 10% down, you know, second home business loan product. 196 00:12:20.891 --> 00:12:28.413 We used Mike Whitfield for some consulting on deciding how to make some final decisions around what room to use for what purpose. 197 00:12:28.793 --> 00:12:30.253 He was helpful in that regard. 198 00:12:30.653 --> 00:12:35.814 And I used him for the large graphics, creating the atmosphere on the walls and things like that. 199 00:12:35.854 --> 00:12:37.435 So Mike was a real asset. 200 00:12:38.475 --> 00:12:40.857 Used Mike and Kevin at Revo. 201 00:12:41.217 --> 00:12:41.617 Yeah. 202 00:12:41.677 --> 00:12:42.658 Did some consulting. 203 00:12:42.698 --> 00:12:42.998 Tax guys. 204 00:12:43.338 --> 00:12:45.360 We did do the cost segregation. 205 00:12:45.500 --> 00:12:46.621 We went through that process. 206 00:12:46.961 --> 00:12:49.983 So that was very beneficial from a tax standpoint. 207 00:12:50.550 --> 00:13:00.538 But yeah, once in this market, and this is probably true for anybody else in smaller markets, I had also, this was never going to be self-managed. 208 00:13:00.558 --> 00:13:03.360 I knew I wasn't shopping in my backyard. 209 00:13:03.840 --> 00:13:05.722 So this was never going to be self-managed. 210 00:13:06.122 --> 00:13:13.328 And in small markets, well, in Bardstown, there was, and to my knowledge, there still isn't a true property management company. 211 00:13:13.948 --> 00:13:21.390 And I didn't want to use a national provider because I knew the level of service was maybe going to be average at best. 212 00:13:22.050 --> 00:13:23.330 So I had to find somebody local. 213 00:13:23.370 --> 00:13:34.593 So I actually took the time to try to contact other owners of short-term rentals in the market to find out who might be interested in co-hosting. 214 00:13:35.940 --> 00:13:37.540 And that's how I found my property manager. 215 00:13:37.600 --> 00:13:49.983 I probably solicited 15 to 20 short-term rental owners, only heard back from maybe half of them at all, and then discovered one that was willing to think about co-hosting. 216 00:13:50.703 --> 00:13:57.365 So that was another barrier to get over, is trying to find a property manager in a very small market. 217 00:13:57.712 --> 00:13:58.872 Yeah, it's a very good point. 218 00:13:59.172 --> 00:14:03.253 In a lot of rural markets, small markets, you just don't have the options, right? 219 00:14:03.553 --> 00:14:05.474 There's not a lot of property management options. 220 00:14:05.714 --> 00:14:14.216 And for those of us, myself included, who don't manage our own properties, that's a, that is a, and it's such an important barrier to get over, right? 221 00:14:14.276 --> 00:14:18.737 We need somebody to deliver this experience that we're spending so much time and money putting together. 222 00:14:19.577 --> 00:14:26.082 And it's a really good point you bring up that we suggest a lot is, look who else is managing properties in the area. 223 00:14:26.102 --> 00:14:36.530 They're probably local, they're already doing it, there's economies of scale and management, they already have some of the things set up, maybe they'd be willing to take on your property, they can make a little bit of extra money, it helps everybody out. 224 00:14:37.070 --> 00:14:43.355 And so, when you went through that process and you found one, did you have to go through multiple or did you find a good one from the very beginning? 225 00:14:43.735 --> 00:14:47.378 Just found one from the very beginning and that's who's been with me ever since. 226 00:14:48.078 --> 00:14:48.859 That's awesome. 227 00:14:49.299 --> 00:14:52.081 Yeah, she and her husband are realtors in the area. 228 00:14:52.121 --> 00:14:56.884 They have two, now maybe three of their own short-term rentals at this point. 229 00:14:56.904 --> 00:14:58.365 I think they only had one at the time. 230 00:14:58.686 --> 00:15:02.228 They've also bought a special event center that they're running. 231 00:15:03.029 --> 00:15:04.470 And again, they're both realtors. 232 00:15:04.510 --> 00:15:04.690 They've 233 00:15:05.202 --> 00:15:07.543 have three little kids, younger kids. 234 00:15:07.964 --> 00:15:18.070 So they're distracted and busy all the time, which actually is its own topic that is applicable to my situation. 235 00:15:18.710 --> 00:15:22.052 We can get into that a little bit further down the road in this conversation, but 236 00:15:22.766 --> 00:15:30.929 Because I've been on autopilot for the last two years, like literally giving this almost none of my time and attention. 237 00:15:30.989 --> 00:15:33.850 We can talk about that. 238 00:15:34.530 --> 00:15:37.171 And I've got a property manager who's very... 239 00:15:38.273 --> 00:15:42.435 bifurcated and distracted with everything that she and her husband have going on. 240 00:15:42.935 --> 00:15:46.397 So this is a property that has, let's put it this way. 241 00:15:46.737 --> 00:15:51.479 We did all of the right things up front and set this house up for success. 242 00:15:51.899 --> 00:15:54.781 Not that we were planning on going into autopilot. 243 00:15:55.501 --> 00:15:56.582 That was never the plan. 244 00:15:56.982 --> 00:16:03.185 But because of doing a lot of the right things on the front end, we've had, you know, over... 245 00:16:03.885 --> 00:16:15.948 200 visitors at this point and five star across the board and not just five stars, but gushing written comments about the experience. 246

00:16:16.188 --> 00:16:16.409 Yeah. 247 00:16:18.001 --> 00:16:18.441 Yeah. 248 00:16:18.461 --> 00:16:19.922 So that's been the good side. 249 00:16:20.262 --> 00:16:25.164 It hasn't really made us any money, but we've provided a great experience. 250 00:16:25.964 --> 00:16:26.905 Howell, talk to me about that. 251 00:16:27.045 --> 00:16:27.625 Yeah. 252 00:16:27.705 --> 00:16:35.568 So we bought because of one, you probably bought a fairly a property that was pretty much like all the deferred maintenance is taken care of. 253 00:16:35.808 --> 00:16:38.529 It was so you're paying kind of top dollar on when you bought it. 254 00:16:38.749 --> 00:16:41.670 One that prices were there, but you didn't, you kind of bought it. 255 00:16:42.310 --> 00:16:45.874 a really good property that a lot of this stuff had been done to already. 256 00:16:45.934 --> 00:16:52.321 So you didn't really have a lot of value add that you were doing outside of bringing it to life on the short-term rental side though, right? 257 00:16:52.922 --> 00:16:53.162 Right. 258 00:16:53.202 --> 00:16:59.749 We had, so using the Biodacy playbook and math, we knew that this was really only going to math 259 00:17:00.530 --> 00:17:05.959 If, and frankly, I was only ever interested in playing in the luxury end of the market. 260 00:17:06.680 --> 00:17:09.264 I didn't, I had no interest in the other parts of the market. 261 00:17:09.304 --> 00:17:13.150 I only wanted to, if I was going to do this, I wanted to provide a luxury experience. 262 00:17:13.507 --> 00:17:17.550 And that's kind of where the math showed it had any real potential at all. 263 00:17:18.010 --> 00:17:25.916 So, yeah, so this is a, this is a, at the time it was a $645,000 house that comped for the area for what it was. 264 00:17:25.956 --> 00:17:27.577 But again, completely empty. 265 00:17:27.938 --> 00:17:36.164 It took about 70 grand to outfit this place for, you know, the kind of experience we wanted to provide. 266 00:17:36.184 --> 00:17:36.424 Yeah. 267 00:17:36.882 --> 00:17:37.122 Yeah. 268 00:17:37.322 --> 00:17:40.584 And interest rates were six and three quarters at that point. 269 00:17:41.464 --> 00:17:50.289 You know, if we had done everything exactly the same back when we could have gotten a 3% mortgage, this thing would have been cash positive from day one. 270 00:17:50.589 --> 00:17:51.410 Yeah, you're making money. 271 00:17:51.990 --> 00:17:53.731 Yeah, I'm making money. 272 00:17:53.771 --> 00:17:56.712 But it's really been that mortgage. 273 00:17:57.413 --> 00:17:59.514 That's keeping it. 274 00:17:59.634 --> 00:18:03.176 So you feel like you're hitting the revenue numbers, but the debt service is higher? 275 00:18:03.236 --> 00:18:05.397 Do you feel like we're short on the revenue numbers as well? 276 00:18:05.994 --> 00:18:12.458 Well, the first year, the numbers off the top of my head is we did about 86,000 the first year. 277 00:18:13.339 --> 00:18:18.082 So really, there was just a few months at the end of 2023, we were open, but just kind of getting momentum. 278 00:18:18.462 --> 00:18:19.963 But 2024 was like 86, 2025 was 77 revenue. 279 00:18:19.983 --> 00:18:21.264 So it started to come down. 280 00:18:21.304 --> 00:18:22.885 And so that was 25. 281 00:18:22.945 --> 00:18:25.147 And 26 is shaping up to be more like 60. 282 00:18:25.507 --> 00:18:25.727 Wow. 283 00:18:33.172 --> 00:18:39.614 And again, this is that trend downwards is mostly just attributable to neglect. 284 00:18:39.654 --> 00:18:45.236 Just not putting any time and energy in, certainly not me. 285 00:18:45.856 --> 00:18:49.958 And then my property manager as well, just also kind of being on autopilot. 286 00:18:50.398 --> 00:18:57.020 Still doing the minimums to make sure that we're providing these five-star reviews. 287 00:18:57.240 --> 00:18:59.821 She's great at communicating pre and post. 288 00:19:00.281 --> 00:19:01.603 But she's kind of on autopilot. 289 00:19:01.623 --> 00:19:04.428 She has a system and she keeps it all going. 290 00:19:04.709 --> 00:19:12.101 I go down probably once a quarter and put my own eyes on everything and tidy things up if I think something needs to be dealt with. 291 00:19:12.202 --> 00:19:12.322 But 292 00:19:13.308 --> 00:19:21.714 largely the theme here is this thing's been on autopilot and the revenue trickling down, down, down, down, down is a result. 293 00:19:22.235 --> 00:19:23.236 Very, very interesting. 294 00:19:23.296 --> 00:19:29.140 Love that you brought that point up because one, we wanna set these properties up on autopilot, right? 295 00:19:29.180 --> 00:19:38.287 For us as an investor, but whoever is delivering that experience and the revenue management piece, this is a big piece, which is pricing and revenue management. 296 00:19:38.887 --> 00:19:42.831 And that strategy on the backend, because that doesn't show up on the photos. 297 00:19:42.931 --> 00:19:44.613 It doesn't show up on the reviews. 298 00:19:45.034 --> 00:19:48.537 She might be doing a great job of delivering the experience, communicating with a guest. 299 00:19:49.038 --> 00:19:56.987 But if we're just getting kind of lazy on the set it and forget it on price labs and set it, forget it on our price optimization tools, and letting them price it out and, 300 00:19:57.567 --> 00:20:01.689 especially if you have a luxury property, what it's doing is suggesting that you be average. 301 00:20:01.889 --> 00:20:03.549 You're gonna average price it, right? 302 00:20:03.649 --> 00:20:05.550 And we're not in a price it toward the top of the market. 303 00:20:05.870 --> 00:20:16.615 That takes manual and very diligent manual pricing and ultimately setting the rules within those optimization tools that are not normally set in there, right? 304 00:20:16.715 --> 00:20:17.055 And so, 305 00:20:18.172 --> 00:20:24.475 Very interesting point that you're making that we don't talk about a lot, that is that costs a lot of people a lot of money. 306

00:20:24.915 --> 00:20:31.599 And it's a lot of times the pricing strategy on the backend, I see it all the time when I audit properties right now. 307 00:20:32.259 --> 00:20:36.101 And it sounds like that might be the case. 308 00:20:36.141 --> 00:20:39.223 When I look at the reviews, you still got five stars across the board. 309 00:20:39.263 --> 00:20:45.246 So as far as like autopilot as communication and cleaning and getting people in and out of there, 310 00:20:46.086 --> 00:20:49.867 that seems to be going okay, but that's not the whole name of the game, right? 311 00:20:50.067 --> 00:20:50.427 That's right. 312 00:20:51.027 --> 00:20:52.347 And would you agree? 313 00:20:52.367 --> 00:20:55.088 Do you feel like that part seems to be doing all right? 314 00:20:56.208 --> 00:20:56.568 Oh, yeah. 315 00:20:56.768 --> 00:20:59.369 Again, it's an amazing property. 316 00:20:59.489 --> 00:21:06.090 When everybody walks in, and I've hosted family and friends down there too, it is wow. 317 00:21:06.650 --> 00:21:07.170 Oh, my gosh. 318 00:21:07.370 --> 00:21:07.690 Wow. 319 00:21:08.111 --> 00:21:08.971 Throughout the whole house. 320 00:21:09.691 --> 00:21:13.232 It's a special property, and people do have a great experience there. 321 00:21:15.212 --> 00:21:15.472 Yeah. 322 00:21:15.793 --> 00:21:17.615 Autopilot, you know, want to make money. 323 00:21:17.835 --> 00:21:18.796 Autopilot doesn't work. 324 00:21:19.317 --> 00:21:20.017 Autopilot doesn't work. 325 00:21:20.058 --> 00:21:23.441 And it can, for me, I hire the right revenue managers on my private. 326 00:21:23.541 --> 00:21:28.267 It's on autopilot for me, but that it's not an autopilot business period. 327 00:21:28.287 --> 00:21:28.447 Right. 328 00:21:28.647 --> 00:21:32.311 Somebody has to be, you know, you can't be asleep at the wheel in this business. 329 00:21:32.391 --> 00:21:35.194 And specifically one as an investor, 330 00:21:35.935 --> 00:21:37.596 I want to spend the money on the right property. 331 00:21:37.696 --> 00:21:39.777 I want to spend the money on the right setup. 332 00:21:40.097 --> 00:21:42.758 And then I want to hand it to somebody that doesn't want to be on autopilot. 333 00:21:43.038 --> 00:21:48.481 And so, and it really, really comes down to a lot of times right now is the revenue. 334 00:21:48.621 --> 00:21:52.263 I'll, I should pull it up right now while we're talking, I should pull it up. 335 00:21:52.283 --> 00:21:52.423 But, 336 00:21:53.063 --> 00:21:58.627 My guess is the revenue being spent by the consumer in Bardstown has not dropped like that. 337 00:21:59.088 --> 00:22:06.473 And if you've got one of the top physical properties in that market, it still has to be looking and say, how am I pricing this? 338 00:22:06.673 --> 00:22:08.395 What is my strategy on the back end? 339 00:22:09.175 --> 00:22:11.316 And we don't need to get into all the details right now. 340 00:22:11.376 --> 00:22:19.321 You and I can talk after we're done, but I love that this point came up because it is something that we see so common on really good top properties in good areas. 341 00:22:19.501 --> 00:22:25.425 And a lot of times the canned response is the market's just going down a little bit. 342 00:22:25.485 --> 00:22:27.546 The market's like, it's just the market. 343 00:22:27.586 --> 00:22:28.606 It's not the market. 344 00:22:28.647 --> 00:22:34.370 We look at this all the time and I would be willing to bet you, you know, a dollar that it's not the market. 345 00:22:34.890 --> 00:22:39.573 Yeah, I actually looked at some just actually in kind of in preparation for our conversation. 346 00:22:39.613 --> 00:22:45.576 I did pull up like the Kentucky tourism, bourbon industry, some some data over the last three years. 347 00:22:45.916 --> 00:22:46.096 Yeah. 348 00:22:46.156 --> 00:22:47.657 And it's kind of what I expected. 349 00:22:47.817 --> 00:22:51.859 The tourism is slightly still going up. 350 00:22:52.319 --> 00:22:52.539 Yep. 351 00:22:52.883 --> 00:22:58.287 The consumption of the actual product is slowly going down. 352 00:22:58.688 --> 00:23:00.329 And that's just a demographic change. 353 00:23:00.389 --> 00:23:03.211 Younger people aren't drinking as much, et cetera, et cetera. 354 00:23:03.331 --> 00:23:12.399 So the actual consumption of the product is on the way down, but the experience, the travel, the tourism, that is still slowly marching up. 355 00:23:12.979 --> 00:23:18.083 And there's something like 75 plus destinations just in Kentucky. 356 00:23:18.644 --> 00:23:22.627 The Bourbon Trail used to be eight primary destinations back. 357 00:23:22.867 --> 00:23:23.808 you know, 10 years ago. 358 00:23:24.468 --> 00:23:24.648 Yeah. 359 00:23:24.868 --> 00:23:26.789 It's 75 plus now. 360 00:23:27.490 --> 00:23:27.910 Exactly. 361 00:23:27.990 --> 00:23:29.090 It's a whole bunch of them now. 362 00:23:29.350 --> 00:23:31.992 And why don't you talk to me about the location? 363 00:23:32.012 --> 00:23:39.876 Because we said right before, I'm going to, while you're telling me this about the location, I'm actually going to look up the dollars being spent in the market, see if it's going up or down, trending up or down. 364 00:23:39.916 --> 00:23:39.936 I 365 00:23:43.858 --> 00:23:47.499 The Bourbon Trail, you've got really, you're on the bottom side of the triangle, right? 366 00:23:47.519 --> 00:23:49.719 You got Louisville, Lexington, and then Bardstown, right? 367 00:23:50.040 --> 00:23:50.800 On the triangle. 368 00:23:51.340 --> 00:23:54.761 And so, and there's distilleries scattered throughout the triangle. 369 00:23:54.821 --> 00:24:00.182 So are you next to what distilleries outside of being close to downtown and restaurants and stuff? 370 00:24:00.502 --> 00:24:04.183 What are their big name distilleries that are close to you, usually within that 20 minute range? 371 00:24:04.841 --> 00:24:05.421 Yeah. 372 00:24:05.461 --> 00:24:09.284 So Bardstown Bourbon has become one of the

biggest players in the industry. 373 00:24:09.304 --> 00:24:10.185 They're fairly new. 374 00:24:10.245 --> 00:24:14.608 They're less than 10 years old, but they're now among the biggest players in the whole industry. 375 00:24:15.529 --> 00:24:16.629 They're right on the edge of town. 376 00:24:16.750 --> 00:24:18.551 Lux Row is right there. 377 00:24:18.791 --> 00:24:20.432 Heaven Hill is right there. 378 00:24:20.812 --> 00:24:23.434 Those are both in town. 379 00:24:23.494 --> 00:24:25.336 1792 used to be right in town. 380 00:24:25.376 --> 00:24:27.237 They're now a little bit outside of town. 381 00:24:27.697 --> 00:24:29.299 Maker's Mark is not far away. 382 00:24:29.679 --> 00:24:32.961 And again, there's about a dozen others within 20 minutes. 383 00:24:34.294 --> 00:24:34.975 Right, right. 384 00:24:35.556 --> 00:24:36.937 Okay, you're going to like this. 385 00:24:37.618 --> 00:24:43.225 This is, well, on one side, you're going to like it because there's a lot of money to be had. 386 00:24:43.585 --> 00:24:46.309 On the other side, you're not going to like it because we're leaving some money on the table. 387 00:24:48.091 --> 00:24:48.732 So bear with me. 388 00:24:48.772 --> 00:24:52.556 Those of you that are listening, so I pulled up the dollars being spent in Bardstown. 389 00:24:53.217 --> 00:24:56.878 specifically, and I look at peaks and valleys throughout. 390 00:24:56.918 --> 00:25:00.218 So if we go to, so really 2024 was your first year, right? 391 00:25:00.258 --> 00:25:04.559 So if the peak in 2024, it looks like the peak every year is around September. 392 00:25:05.619 --> 00:25:08.220 And so- September, October are the two busiest months. 393 00:25:08.300 --> 00:25:09.420 Yeah, September, October. 394 00:25:09.460 --> 00:25:14.021 So we'll go to our, well, let's go to our October peak. 395 00:25:14.201 --> 00:25:15.881 That does look like it's the peak there. 396 00:25:16.141 --> 00:25:19.282 And so October of 2024, $511,000 spent in Bardstown. 397 00:25:22.715 --> 00:25:27.057 October 2025, $641,000 spent in Bardstown. 398 00:25:27.877 --> 00:25:31.098 October 2026, $945,000. 399 00:25:31.298 --> 00:25:45.224 So while we're dropping a little bit, and I'll tell you what we really find, John, is on these, the luxury side properties are really capturing their unfair share of those dollars being spent in the market. 400 00:25:45.344 --> 00:25:49.549 And so my guess is we change our pricing strategy on this property. 401 00:25:49.849 --> 00:25:52.832 It's an overnight change in that, in what's going on. 402 00:25:53.112 --> 00:26:00.821 And then it's something we really should look at because that there, like you're, you look at the overall tourism, but really just, I look at this is just revenue numbers. 403 00:26:00.881 --> 00:26:03.724 This is revenue being money being spent by the consumer. 404 00:26:03.744 --> 00:26:05.085 That's an indicator of the demand. 405 00:26:05.466 --> 00:26:06.226 And so if we're at 945, right.

406 00:26:07.875 --> 00:26:09.136 in, oh, that was September. 407 00:26:09.176 --> 00:26:10.877 Sorry, because we don't have October numbers yet. 408 00:26:10.897 --> 00:26:12.078 That was September of 2026. 409 00:26:12.098 --> 00:26:13.739 That was 945. 410 00:26:14.440 --> 00:26:16.481 And last year, September was at 641. 411 00:26:16.501 --> 00:26:18.322 That's a pretty massive increase, right? 412 00:26:18.342 --> 00:26:20.784 You got a 30% increase in dollars being spent. 413 00:26:20.924 --> 00:26:26.028 And sometimes we assume that the market's not as good as it actually is on the back end. 414 00:26:26.048 --> 00:26:28.730 And we've got, you've got all the recipes to be able to get 415 00:26:29.370 --> 00:26:35.814 Like it pains me to hear that those dollars are going down when I look at this property and I look at what you've got and where you're at. 416 00:26:35.994 --> 00:26:39.856 And so it's very interesting to hear that and look it up in real time as we're having the conversation. 417 00:26:40.577 --> 00:26:40.717 Yeah. 418 00:26:42.335 --> 00:26:48.620 So not to throw salt on the wound or say, hey, listen, somebody's got to change, but we need to change something, right? 419 00:26:48.660 --> 00:26:51.402 We definitely need to, and it's the revenue side of it. 420 00:26:51.442 --> 00:26:52.783 The revenue management side. 421 00:26:52.863 --> 00:27:00.910 One thing we haven't brought up yet is by the end of 2025, the end of last year, I had just... 422 00:27:01.470 --> 00:27:12.116 take an honest assessment that my time and interests had not been focused on this for quite a while and was not and that wasn't going to change. 423 00:27:12.777 --> 00:27:17.319 So I contacted my my same realtor, Chelsea Wood. 424 00:27:17.760 --> 00:27:20.561 She works with some other Vodasi people as well. 425 00:27:20.581 --> 00:27:21.142 I know Chelsea. 426 00:27:21.262 --> 00:27:22.102 I met Chelsea, actually. 427 00:27:22.122 --> 00:27:23.543 I actually looked at properties with Chelsea. 428 00:27:24.124 --> 00:27:24.724 Okay, great. 429 00:27:25.606 --> 00:27:26.647 So Chelsea's my realtor. 430 00:27:27.028 --> 00:27:30.593 So I contacted Chelsea and I said, Chelsea, I really think we need to move on. 431 00:27:30.673 --> 00:27:35.620 And this is where we discovered something quite unfortunate out of the blue. 432 00:27:35.921 --> 00:27:38.425 We wanted to put the house up on the market and we, and 433 00:27:38.965 --> 00:27:39.506 And we did. 434 00:27:40.086 --> 00:27:54.681 But in the process, we learned that the town, unbeknownst, no announcements, no letters sent, no email sent, the town had changed their regulation for short-term rentals in town, inside the city limits. 435 00:27:55.161 --> 00:27:57.984 Not just historical district issue, city limits. 436 00:27:58.304 --> 00:27:58.565 Okay. 437 00:27:58.945 --> 00:28:00.386 And the change was... 438 00:28:01.255 --> 00:28:16.102 Now, if this property were to sell and somebody wanted to buy

it and just keep operating it as a short-term rental and give it the juice that somebody like you could give it, they would have to have it as their primary residence. 439 00:28:16.442 --> 00:28:23.545 And they would have to be there when the guests are there, which is the definition of an Airbnb, or I'm sorry, a bed and breakfast, right? 440 00:28:23.565 --> 00:28:23.765 Yeah. 441 00:28:24.585 --> 00:28:28.348 So it was a ridiculous change. 442 00:28:28.408 --> 00:28:36.114 It was basically the town's way of saying, we don't want to put any more of our time and energy into regulating any of this. 443 00:28:36.695 --> 00:28:39.117 We're just going to hope that by someday... 444 00:28:40.379 --> 00:28:42.061 This won't even be an issue in town. 445 00:28:42.081 --> 00:28:43.123 It phases itself out. 446 00:28:43.343 --> 00:28:47.668 They didn't change anything about out of town if you're outside the city limits. 447 00:28:47.989 --> 00:28:53.215 But if you're in town, so Chelsea said, I would have sold this property. 448 00:28:53.235 --> 00:28:55.759 I would have had multiple bids within a week. 449 00:28:56.972 --> 00:29:10.500 if people were still able to operate this as a short-term rental, because they could see the potential in it that we weren't necessarily manifesting, but it was easy to see that this, this was a great short-term rental opportunity. 450 00:29:11.141 --> 00:29:19.306 So Chelsea's been, she's got brain damage at this point, fielding phone calls, just keep having to tell people, nope, it's gotta be a single family home. 451 00:29:19.346 --> 00:29:20.707 It's gotta be a single family home. 452 00:29:21.187 --> 00:29:22.307 Again, this is a 226 year old house that, 453 00:29:25.169 --> 00:29:30.831 When it was built, the downstairs has 12-foot ceilings, but the upstairs is where the servants used to live. 454 00:29:30.891 --> 00:29:33.432 And the ceilings are slanted. 455 00:29:33.592 --> 00:29:46.657 And we really, the guy I bought it from really had to get creative on how to get the plumbing and stuff to work, to have a nice, luxurious bathroom upstairs, et cetera, et cetera. 456 00:29:47.217 --> 00:29:49.758 So now we've got a house that could comp at $700,000. 457 00:29:51.719 --> 00:29:59.606 for sale in a market that the average house in Bardstown is probably $300,000 at the most. 458 00:29:59.846 --> 00:30:02.469 The average house, maybe high $200,000. 459 00:30:03.149 --> 00:30:13.419 So it's a mismatch on, you know, it's going to take a special buyer to come in and even think about this as a single family home, let alone the fact that it's so darn unique. 460 00:30:14.397 --> 00:30:16.038 It's in the historical district. 461 00:30:16.278 --> 00:30:18.879 It's not a family-friendly house. 462 00:30:19.059 --> 00:30:19.319 Right. 463 00:30:19.619 --> 00:30:23.881 It's in the middle of the action type of a house in the historical district, right? 464 00:30:23.941 --> 00:30:29.383 Like, I want to walk to the bars, but it's

also, to your point, it's in an area where 465 00:30:29.843 --> 00:30:35.046 that there's a premium because the highest and best use for it is what you're using it for. 466 00:30:35.146 --> 00:30:38.688 But it's also if if it doesn't work that way for the next buyer. 467 00:30:38.728 --> 00:30:44.612 So you're not you're not being told like you're grandfathered in because you're operating a licensed and permit. 468 00:30:44.692 --> 00:30:47.453 But the new buyer see that that that. 469 00:30:47.713 --> 00:30:49.815 Yeah, that's that's very unfortunate. 470 00:30:49.835 --> 00:30:52.916 It really hurts those owners in those areas. 471 00:30:53.017 --> 00:30:53.117 And. 472 00:30:53.937 --> 00:30:55.398 Because it hurts the value of the property. 473 00:30:55.418 --> 00:30:59.979 Because now all of a sudden, it's like taking a commercial property and saying, hey, listen, you can't use it on commercial anymore. 474 00:31:00.159 --> 00:31:06.282 It's no longer, but you're in a, when you're in a commercial type of a district with these types of properties, the homeowner doesn't want to live there. 475 00:31:06.602 --> 00:31:06.842 Right. 476 00:31:06.902 --> 00:31:10.503 And so it makes it very, very difficult to sell those types of properties outside of that. 477 00:31:11.164 --> 00:31:19.227 And ironically, I have not been able to track down anybody who can tell me what the conversation was back a couple of years ago when they changed this. 478 00:31:19.882 --> 00:31:22.043 You know, people on certain committees have changed. 479 00:31:22.104 --> 00:31:28.208 I finally, just earlier this week, got the guy who runs the planning and zoning in Bardstown. 480 00:31:28.428 --> 00:31:32.030 And there was a little bit of fruit that came out of that conversation. 481 00:31:32.150 --> 00:31:35.933 He had no idea what the backstory was on why the regulation changed. 482 00:31:36.373 --> 00:31:37.414 He was tipping his hand. 483 00:31:37.434 --> 00:31:41.597 Yeah, it doesn't make sense to me either, but he's newer on the scene. 484 00:31:42.157 --> 00:31:47.040 But to make a long story short, we did think of a potential workaround. 485 00:31:47.780 --> 00:31:54.964 If we don't find a single-family homebuyer relatively soon, I am going to spend some time and energy chasing this down. 486 00:31:55.565 --> 00:32:10.213 But he was saying that if the LLC that I created is actually the entity that got the special use permit, that I could sell the LLC and the property inside of it. 487 00:32:10.833 --> 00:32:15.036 But the LLC is who holds the permit. 488 00:32:15.836 --> 00:32:25.122 And now that's going to create a very, it's going to make, it's going to be a very complicated conversation to try to have with potential buyers. 489 00:32:25.462 --> 00:32:30.905 And because they're going to want assurances that eventually it's all going to work out and it's going to take a lot of effort. 490 00:32:30.925 --> 00:32:36.448 But Chelsea and I may not have a choice if we really aren't finding buyers. 491 00:32:36.969 --> 00:32:39.190 You know, I don't want to give the property away, but- 492 00:32:39.610 --> 00:32:46.293 At this point, you know, I'm willing to take just about any bid because I really need it. 493 00:32:47.233 --> 00:32:49.954 Yeah, I need it to be kind of out of the back of my mind. 494 00:32:50.555 --> 00:32:50.795 Right. 495 00:32:51.055 --> 00:33:00.099 And that's kind of what I was wondering too, if the LLC can be sold where it transfers, where now the permit doesn't, it stays with the LLC, right? 496 00:33:00.299 --> 00:33:02.780 And it stays with that house, the LLC that you've created. 497 00:33:02.800 --> 00:33:04.901 It'd be interesting to see how that shakes out. 498 00:33:04.941 --> 00:33:06.941 I wouldn't stop running down the road with the city either. 499 00:33:06.981 --> 00:33:07.742 It's trying to uncover... 500 00:33:08.482 --> 00:33:13.407 I want to see why and when this was changed and who was a notified. 501 00:33:13.427 --> 00:33:18.513 This really affects property values, especially in a district like that, and be able to look at that. 502 00:33:18.533 --> 00:33:23.338 In the meantime, I would look at the pricing as well and put a little more money in your pocket. 503 00:33:23.878 --> 00:33:35.085 In the meantime, when Jake contacted me about having this conversation, I told Jake, I said, hey, I'm actually going to write something up for Sean and I'm going to get on a Tuesday AMA call. 504 00:33:35.245 --> 00:33:35.965 I wish you would. 505 00:33:36.506 --> 00:33:43.270 And I want Sean to give the 30,000 foot flyover audit, the 10,000 foot flyover audit. 506 00:33:43.910 --> 00:33:46.471 And because I've seen you do it on the Tuesday AMA calls. 507 00:33:46.872 --> 00:33:58.898 And that's exactly what this property needs right now is, you know, we've got we've got a little wound that's bleeding on an ongoing basis and we need to cauterize it as much as we can until we can get the house officially sold. 508 00:33:59.438 --> 00:34:02.380 So, yeah, I'm going to tee that up for this coming Tuesday. 509 00:34:03.000 --> 00:34:06.642 I can't wait because I can just I got excited just looking at that. 510 00:34:06.682 --> 00:34:13.764 What we just looked at together while we were talking on the podcast is that the dollars being spent is they're there and going up. 511 00:34:14.125 --> 00:34:21.888 And that on a property like this, like normally sometimes you can look at a property and I can say, listen, you're we don't have a luxury property. 512 00:34:21.908 --> 00:34:23.128 We don't have a great property. 513 00:34:23.168 --> 00:34:24.909 Our location is not great proximity. 514 00:34:25.209 --> 00:34:26.990 There's certain things that we can see right out of the gate. 515 00:34:27.670 --> 00:34:32.272 When you already have all that, and those of you listening, we always post the property links in the show notes. 516 00:34:32.472 --> 00:34:36.954 And so if you're interested in

checking the property out, you can always go to the Airbnb link and check them out. 517 00:34:37.394 --> 00:34:38.394 So you know what we're talking about. 518 00:34:38.414 --> 00:34:44.517 But when I see a property like that, and I see that, and I hear that story of the revenue, I look at the delivery of it. 519 00:34:44.677 --> 00:34:46.538 You've got the guest loves the property. 520 00:34:46.638 --> 00:34:48.458 And like you said, there's glowing reviews about it. 521 00:34:49.059 --> 00:34:52.640 All of those things are stacking up to say, hey, this is a revenue management property. 522 00:34:52.760 --> 00:34:56.502 problem that we're not pricing this anywhere near what we should be pricing it at. 523 00:34:56.522 --> 00:34:58.083 And our strategy is probably way off. 524 00:34:58.103 --> 00:35:14.851 So Tuesday, I look forward to looking and diving into that so we can do that together because I think- If anything, we've been, when I've looked, and again, I haven't spent much time doing it and that's on me, but when I have looked, if anything, I think we've been too high most of the time. 525 00:35:15.192 --> 00:35:15.372 Yeah. 526 00:35:16.232 --> 00:35:22.458 We actually priced ourselves out of the average because it's not like we have no competition. 527 00:35:22.618 --> 00:35:31.706 As a matter of fact, when I first did this in 2023, the comps for what I created, I could probably count on one hand. 528 00:35:32.606 --> 00:35:33.607 Now, that's not the case. 529 00:35:34.128 --> 00:35:39.252 It's more like a couple dozen that I would look at and go, wow, that's nice. 530 00:35:39.272 --> 00:35:39.652 They're nice. 531 00:35:39.672 --> 00:35:40.133 That's nice. 532 00:35:40.153 --> 00:35:40.533 They're nice. 533 00:35:40.553 --> 00:35:40.853 That's nice. 534 00:35:40.873 --> 00:35:41.094 Yeah. 535 00:35:41.794 --> 00:35:42.915 Yeah. 536 00:35:43.355 --> 00:35:46.096 So that is actually really helpful for a market. 537 00:35:46.256 --> 00:35:51.079 As you notice, we have we've got 30% jumps in revenue every single year. 538 00:35:51.179 --> 00:35:53.440 Total dollars being spent in that market. 539 00:35:53.480 --> 00:35:57.102 That is an indicator that there's better properties to spend money on. 540 00:35:57.162 --> 00:36:02.324 And that's actually really good when you're at the top of the market to say, Hey, listen, the consumers are actually coming here now. 541 00:36:02.805 --> 00:36:04.425 They're noticing that they want to spend money here. 542 00:36:04.445 --> 00:36:05.426 They like to spend time here. 543 00:36:05.686 --> 00:36:12.193 So that's actually a good thing when you have a really nice property in the market to have a little bit more competition than just what you can count on one hand. 544 00:36:12.313 --> 00:36:14.915 And so sometimes we think that's counterintuitive. 545 00:36:14.935 --> 00:36:16.377 That's actually really good for you. 546 00:36:17.058 --> 00:36:18.659 And a very common strategy. 547 00:36:18.739 --> 00:36:23.564 One of the one of the audits I just did on within our Vodacy family, we had a member who had a property. 548 00:36:24.025 --> 00:36:25.766 It's about a seven hundred dollar a night property. 549 00:36:25.926 --> 00:36:26.227 Right. 550 00:36:26.267 --> 00:36:28.229 That's about what our averages should be. 551 00:36:28.669 --> 00:36:28.849 Well, 552 00:36:29.550 --> 00:36:35.532 Their pricing strategy was, and it was using a tool that everybody knows and just plug and play the tool. 553 00:36:35.832 --> 00:36:39.092 And they said, I want to be at the top 90th percent because I'm a top property. 554 00:36:39.532 --> 00:36:48.115 And so this tool was suggesting outside of like 60 days, they were asking for like almost $2,000 a night, anywhere from $1,600 to $2,000 a night. 555 00:36:48.195 --> 00:36:50.355 It's not a $1,600 a night property, right? 556 00:36:50.375 --> 00:36:57.157 So even if you're, so what it was doing is maybe to what you guys are doing, we'll look at it is asking for way too high 557 00:36:57.837 --> 00:36:58.317 further out. 558 00:36:58.718 --> 00:37:00.999 They were never going to, it's not a $2,000 a night property. 559 00:37:01.059 --> 00:37:02.380 It's not a $1,500 a night property. 560 00:37:02.400 --> 00:37:05.902 It's a $700, $800 a night property if you're asking for a premium. 561 00:37:06.683 --> 00:37:11.346 So we just had to bring that premium down closer to what it should be at. 562 00:37:11.406 --> 00:37:16.469 But what they were also doing is as it got close, it was this massive, massive drop. 563 00:37:16.509 --> 00:37:22.493 So when they got within 45 days, they were at their $700 mark for less than a week. 564 00:37:22.833 --> 00:37:24.194 And then it would go down to $350. 565 00:37:24.254 --> 00:37:25.275 And everybody was booking it at $350. 566 00:37:26.976 --> 00:37:28.877 You're training your customer to wait. 567 00:37:28.897 --> 00:37:33.100 Yeah, the customer is just like, and it's just a slide right down to that 350 mark. 568 00:37:33.120 --> 00:37:34.241 And then they would hold and they book it. 569 00:37:34.602 --> 00:37:36.783 And I'm like, they're like, well, what if it's $700 a night? 570 00:37:36.803 --> 00:37:38.024 Why wouldn't it book at $700 nights? 571 00:37:38.344 --> 00:37:41.226 Well, in a month's period, you're only $700 for three or four days. 572 00:37:42.387 --> 00:37:42.587 Right. 573 00:37:42.687 --> 00:37:45.128 You need you guys need to be at your at where you're at. 574 00:37:45.148 --> 00:37:45.749 I would drop it. 575 00:37:45.789 --> 00:37:49.150 Maybe I would drop it to five fifty at a discount and a premium. 576 00:37:49.250 --> 00:37:50.571 I might be asking for eight fifty. 577 00:37:50.751 --> 00:37:51.231 Right. 578 00:37:51.411 --> 00:37:53.692 And I'm going to keep it closer in that delta. 579 00:37:54.092 --> 00:37:54.933 Maybe that's what we're doing. 580 00:37:54.953 --> 00:38:04.837 If you feel like you're asking too much a lot of times and

instantly overnight, this property should be like it's like, OK, that's a change you can make and instantly start to get revenue coming back in. 581 00:38:05.037 --> 00:38:15.164 I know we weren't that far off the mark, but the pricing that we dialed in for late 23, all of 24, seemed to be working pretty well. 582 00:38:15.264 --> 00:38:19.868 The mistake, if you will, is as the market became much more competitive through 24 and 583 00:38:20.973 --> 00:38:23.996 25, now into 26, 26 is almost over. 584 00:38:24.576 --> 00:38:36.386 It was that not using some of the pricing tools and just kind of staying with the program that the pricing program that seemed to have worked pretty darn well in 2024. 585 00:38:37.087 --> 00:38:38.448 We just kind of, again... 586 00:38:38.588 --> 00:38:39.508 too much autopilot. 587 00:38:39.528 --> 00:38:40.188 Set it and forget it. 588 00:38:40.228 --> 00:38:40.749 Yeah. 589 00:38:41.069 --> 00:38:42.189 It has, that's not it. 590 00:38:42.469 --> 00:38:45.150 That revenue management is definitely not a set and forget. 591 00:38:45.170 --> 00:38:46.910 In fact, it's not set it and forget it for a year. 592 00:38:47.150 --> 00:38:49.931 It's set, it's like, okay, during this season, I'm gonna do this. 593 00:38:49.991 --> 00:38:51.232 During this season, I'm gonna do this. 594 00:38:51.252 --> 00:38:53.932 I'm gonna have different strategies at different times of the year. 595 00:38:54.193 --> 00:38:56.213 I'm gonna have different strategies on different days of the year. 596 00:38:56.233 --> 00:38:57.914 This is a weekend type of a market, right? 597 00:38:57.934 --> 00:39:00.174 We're gonna really capitalize on those weekends. 598 00:39:00.274 --> 00:39:01.115 And so it's, yeah, I, 599 00:39:02.895 --> 00:39:04.256 We'll dive into this Tuesday. 600 00:39:04.316 --> 00:39:08.980 You and I will, where we have all the numbers, but I love that this came up on the podcast. 601 00:39:09.100 --> 00:39:11.643 Very rare does this conversation come up on the podcast. 602 00:39:11.663 --> 00:39:19.649 So it's fun to be able to have this where people can listen in and understand that there's, I always say this is not a game of one silver bullet. 603 00:39:19.709 --> 00:39:22.011 This is a game of a thousand golden BBs, right? 604 00:39:22.151 --> 00:39:27.976 And just because you dialed in 900 of the BBs, the other hundred could affect your revenue significantly. 605 00:39:29.602 --> 00:39:29.782 Yeah. 606 00:39:30.302 --> 00:39:31.123 So awesome. 607 00:39:31.143 --> 00:39:33.625 Well, listen, John, so as we wrap up, I always put you on the spot. 608 00:39:33.765 --> 00:39:44.211 I always love to ask you like kind of words, if you will, like if you could go back and give your younger self some advice, people listening, you know, saying, hey, I wish I would have done this different. 609 00:39:44.231 --> 00:39:45.592 I wish I wouldn't have done that. 610 00:39:45.672 --> 00:39:50.115 Is there anything that comes to mind as far

as a piece of advice that we could that we could wrap up with? 611 00:39:51.419 --> 00:40:04.166 You know, at the top of my list, one of the, again, this is getting back into a little bit of backstory of why, you know, life kind of took over and my interest and passion in investing is really what I spent all my time and energy on. 612 00:40:04.706 --> 00:40:06.827 And I seem to be doing it very successfully. 613 00:40:07.488 --> 00:40:16.912 So, you know, it's for young people to really, really understand the math magic of compounding. 614 00:40:17.413 --> 00:40:17.973 Oh, love it. 615 00:40:18.213 --> 00:40:31.212 And to save, save, save in your 20s, frankly, in your teens, take 10% of that part-time job you have and just start putting $10 away, $25 away, 616 00:40:33.615 --> 00:40:39.078 Don't buy the silly stuff that we all, you know. 617 00:40:39.678 --> 00:40:50.464 So that's right at the top of my list because I spend all my time and mental energy these days, a lot of it in the real estate and investing world or in the investing world. 618 00:40:51.025 --> 00:40:54.347 And that's the number one thing I would impart. 619 00:40:54.707 --> 00:40:58.509 We taught it to our kids when they were still teenagers and, 620 00:40:58.969 --> 00:41:07.215 Other than that, you know, just don't don't live your life based on on other people's expectations and what you think their perceptions are of you. 621 00:41:07.895 --> 00:41:13.379 You know, this is about and frankly, back to the whole compounding and investing thing. 622 00:41:13.539 --> 00:41:15.521 What people really want is freedom. 623 00:41:16.101 --> 00:41:19.183 Money cannot buy happiness, but the lack of it. 624 00:41:20.104 --> 00:41:45.740 can certainly take away your freedom what people really want is to be able to do what they want when they want with whom they want for as long as they want yeah and financial resources provide that and the lack of it can make you pretty miserable takes it away absolutely takes it away so appreciate the magic and einstein said it was the eighth wonder of the world exactly it's to understand the math of compounding 625 00:41:46.265 --> 00:41:48.546 Yeah, it's I love that so much. 626 00:41:48.566 --> 00:41:49.087 Yeah, you're right. 627 00:41:49.107 --> 00:41:50.367 The eighth wonder of the world, right? 628 00:41:50.387 --> 00:41:51.208 Compound interest. 629 00:41:51.408 --> 00:41:55.030 And it is we're always looking for those home runs on an investment. 630 00:41:55.070 --> 00:41:56.731 It's like I need those massive returns. 631 00:41:57.151 --> 00:42:03.595 If you just understand the power of compound interest over time with a steady small return, it is massive, right? 632 00:42:03.715 --> 00:42:05.476 And the sooner you can start, the better. 633 00:42:06.136 --> 00:42:07.896 And and so I love that. 634 00:42:08.056 --> 00:42:09.417 And you're exactly right. 635 00:42:09.437 --> 00:42:11.017 Lifestyle freedom, financial freedom, right? 636 00:42:11.037 --> 00:42:17.198 Everybody's chasing that financial freedom and it can help buy that lifestyle freedom, which is say yes to the things you want to do and no to the things you don't want to do. 637 00:42:17.578 --> 00:42:21.659 Well, it's one of the things that resonated when I first was listening to your podcast back in 2022. 638 00:42:21.779 --> 00:42:26.260 It was you were you were very upfront about, hey, this did nothing. 639 00:42:26.340 --> 00:42:28.200 Nothing about this is get rich quick. 640 00:42:28.640 --> 00:42:28.840 Right. 641 00:42:28.880 --> 00:42:30.100 This is this is work. 642 00:42:30.160 --> 00:42:31.601 This is effort. 643 00:42:32.101 --> 00:42:33.121 But there is a roadmap. 644 00:42:33.541 --> 00:42:34.242 Yeah. 645 00:42:34.322 --> 00:42:36.663 This is the definition of compound over time, right? 646 00:42:36.703 --> 00:42:39.526 This is that's absolutely the definition. 647 00:42:39.546 --> 00:42:43.709 This is these are not, you know, we're not retiring on one property by any stretch. 648 00:42:43.769 --> 00:42:44.009 Right. 649 00:42:44.089 --> 00:42:45.870 And so in fact, quite the opposite. 650 00:42:45.910 --> 00:42:48.332 And so I, John, I love this conversation. 651 00:42:48.452 --> 00:42:48.973 I love that. 652 00:42:49.293 --> 00:42:51.655 We were able to run down the road that we ran down. 653 00:42:52.095 --> 00:42:56.378 Very unique conversation, more of a, and we'll dive into it more on our coaching call on Tuesday. 654 00:42:56.398 --> 00:42:59.780 But it is, I so appreciate you being willing to have that conversation. 655 00:42:59.800 --> 00:43:06.004 A lot of times people are nervous to say, you know, where things are going wrong and where they're, you know, where we're having bumps in the road. 656 00:43:06.104 --> 00:43:11.828 And part of what we do here at Vodesee, our ultimate goal always is to help people walk into this game with their eyes wide open. 657 00:43:12.208 --> 00:43:14.069 Like I always say, this is not an easy road. 658 00:43:14.089 --> 00:43:15.189 This is not an easy button. 659 00:43:15.689 --> 00:43:17.670 And sometimes we hear all these other stories. 660 00:43:17.730 --> 00:43:24.793 And to your point earlier is we compare ourselves to everybody else and we compare ourselves and our success against everybody else's success. 661 00:43:24.833 --> 00:43:26.313 And sometimes you don't know the whole story. 662 00:43:26.893 --> 00:43:30.675 And so we can have these conversations and people can start to hear more of the whole story. 663 00:43:31.155 --> 00:43:33.416 I think it all puts us all in a better position. 664 00:43:33.516 --> 00:43:34.776 And I'm so appreciative of it. 665 00:43:34.796 --> 00:43:36.037 So I appreciate you joining me today. 666 00:43:36.057 --> 00:43:37.377 It's been a really fun conversation. 667 00:43:37.397 --> 00:43:38.438 We're all in this together. 668 00:43:38.879 --> 00:43:41.882 I have no regrets about having done this. 669 00:43:41.902 -->

00:43:43.103 You know, life takes over. 670 00:43:43.303 --> 00:43:45.826 That's another life lesson is just be ready. 671 00:43:45.906 --> 00:43:46.767 Life can take over. 672 00:43:46.827 --> 00:43:48.029 It did for me in other ways. 673 00:43:48.169 --> 00:43:51.773 And now I need to move on from the short-term rental world. 674 00:43:52.193 --> 00:43:54.135 But no regrets at all. 675 00:43:54.275 --> 00:43:55.397 This has been fun. 676 00:43:56.738 --> 00:43:57.038 Love it. 677 00:43:57.178 --> 00:43:57.478 Love it. 678 00:43:57.538 --> 00:44:00.039 And since we're talking about the bourbon trail, love your shirt. 679 00:44:00.099 --> 00:44:00.719 Life happens. 680 00:44:00.839 --> 00:44:01.439 Bourbon helps. 681 00:44:01.759 --> 00:44:03.660 And I always do Whiskey Wednesday. 682 00:44:03.680 --> 00:44:04.980 And so I couldn't agree more. 683 00:44:05.040 --> 00:44:07.281 So we'll wrap it up with that. 684 00:44:07.321 --> 00:44:10.061 I had this shirt made and it's got the house logo on the back of it. 685 00:44:10.541 --> 00:44:11.402 Oh, that's awesome. 686 00:44:11.422 --> 00:44:13.742 So people have them when they get to the house? 687 00:44:14.222 --> 00:44:16.963 Yeah, we give them away as swag every once in a while. 688 00:44:17.023 --> 00:44:21.564 And we give away a nice whiskey glass with the house logo on it. 689 00:44:21.624 --> 00:44:24.605 We put together a little basket so everybody gets a glass when they... 690 00:44:25.396 --> 00:44:25.916 when they leave. 691 00:44:26.196 --> 00:44:27.076 Yeah, yep. 692 00:44:27.156 --> 00:44:28.497 Tee them up for the whole trip, right? 693 00:44:29.017 --> 00:44:29.517 That's right. 694 00:44:29.637 --> 00:44:30.217 That's awesome. 695 00:44:30.697 --> 00:44:31.657 Well, John, we'll wrap it up. 696 00:44:31.677 --> 00:44:32.598 I appreciate you, my man. 697 00:44:32.658 --> 00:44:36.898 Those of you listening, we know how valuable your time is and we appreciate you spending with us. 698 00:44:37.338 --> 00:44:39.879 I hope you got as much out of these conversations as I always do. 699 00:44:40.119 --> 00:44:47.581 Every single week, I learn more when I have these conversations and that collective knowledge and experience hopefully puts us all in a better position to succeed. 700 00:44:47.601 --> 00:44:48.801 And that's our goal here at Vodesee. 701 00:44:49.581 --> 00:44:53.664 Those of you that listen on a regular basis, you don't have to listen to a bunch of ads and sponsorships. 702 00:44:53.704 --> 00:44:55.846 And so the only way the show grows is if you guys share it. 703 00:44:55.906 --> 00:44:58.729 And so I always ask you at the end of every episode to like it. 704 00:44:58.749 --> 00:44:59.489 Give us a thumbs up. 705 00:44:59.509 --> 00:45:02.151 Give us a review on whatever platform you're watching or listening on. 706 00:45:02.572 --> 00:45:06.095 Those things are very, very much appreciated on our side because it helps the show grow. 707 00:45:06.575 --> 00:45:11.779 But the final, most important thing I ask you at the end of every single episode is pick that one thing you can do today. 708 00:45:11.819 --> 00:45:13.901 Start building that life you don't want to take a vacation from. 709 00:45:14.101 --> 00:45:14.642 Cheers, my friends. 710 00:45:15.623 --> 00:45:15.923 Cheers. 711 00:45:16.625 --> 00:45:23.690 Thanks for joining us on this episode of the Vacation Rental Revolution podcast. 712 00:45:24.070 --> 00:45:27.452 Share this with other people you think need to hear about it. 713 00:45:27.712 --> 00:45:30.935 And don't forget to subscribe and leave us a review. 714 00:45:31.315 --> 00:45:33.036 Hey Grace, is there a website? 715 00:45:33.436 --> 00:45:33.797 Yes! 716 00:45:34.157 --> 00:45:38.780 For more amazing content and expert advice, visit Vodicy.com. 717 00:45:39.360 --> 00:45:43.243 Thanks for listening and we'll see you on the next episode.