Building a 150-Unit “Lease Arbitrage” Empire and the STR Furnishing Playbook - Transcripts

September 22, 2022

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Short-term rental arbitrage seems like an elusive concept. As a real estate investor, it can be a little hard to wrap your head around it. You lease a property, rent it out, and then…profit? That’s right! Without buying a rental property, dealing with maintenance or large-scale repairs, you too can make just as much money (if not more) than the landlord down the street without ever owning the property in the first place. It sounds like a dream, but in reality, you’ll need an airtight system and team to make it work. Thankfully, Jeff Iloulian has all that and more. Before 2014, Jeff was living as a lucrative lawyer, billing high by-the-minute rates and making money every second he worked. This was during the “wild west” of short-term rental investing, where mom-and-pop owned vacation rentals were starting to become a serious way to make passive income. Jeff initiated his portfolio with just one “lease arbitrage” unit and eventually ballooned his empire up to 150 rentals! Now, Jeff does more than just run his short-term rental portfolio. He runs the buying group HostGPO, helping link up short-term rental operators with vendors who can provide better, time-tested, industry-specific products. Not only that, Jeff manages numerous other vacation rentals, so he knows everything from furnishing to cleaning, check-out procedures, and more. He gives a furniture and furnishing masterclass in the second half of this interview where many of his tips could save you thousands over the lifetime of just one rental unit. In This Episode We Cover: Rental arbitrage and how any investor (no matter their budget) can use it to make passive income Breaking out of the “not enough time” matrix to start investing on a busy schedule Furnishing your short-term rental and why IKEA may not be the best bet for bed sheets Building your short-term rental dream team and how to manage a large-scale portfolio The mega-niche investing opportunity of renting soon-to-be destroyed homes  Leaving a lucrative career to invest in real estate and why it’s almost always worth it And So Much More! Links from the Show BiggerPockets Youtube Channel BiggerPockets Forums BiggerPockets Pro Membership BiggerPockets Bookstore BiggerPockets Bootcamps BiggerPockets Podcast Get Your Ticket for BPCon 2022 Listen to All Your Favorite BiggerPockets Podcasts in One Place Learn About Real Estate, The Housing Market, and Money Management with The BiggerPockets Podcasts Get More Deals Done with The BiggerPockets Investing Tools Find a BiggerPockets Real Estate Meetup in Your Area David's BiggerPockets Profile David's Instagram Rob's BiggerPockets Profile Rob's Youtube Rob's Instagram Rob's TikTok Rob's Twitter Airbnb Rental Arbitrage—The Ultimate Guide The Ultimate Guide to Short-Term Rental Properties Creative Ways to Furnish Your Short-Term Rentals on a Budget How to Build Your Dream Short-Term Rental Team Get Exclusive Short-Term Rental Investor Discounts with HostGPO Book Mentioned in the Show: Buy, Rehab, Rent, Refinance, Repeat by David Greene Short-Term Rental, Long-Term Wealth by Avery Carl Connect with Jeff: Jeff's Website Click here to check the full show notes: https://www.biggerpockets.com/blog/real-estate-665 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Check out our sponsor page! See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Transcript

this is the bigger pockets podcast show

six sixty five I think a successful investor is someone who is willingly ready to have it whenever that needs to happen so I think any anybody who has a strict mindset and is Bridget on this is what I'm gonna do and it's on willing to actually look at the data in front of them look at what the deal is in front of them and what they were hoping for is destined for failure and I think that somebody who is flexible and treats each deal each deal each property like a snowflake is as more likely to succeed

what's going on everyone this is David green your host of the bigger pockets realistic podcast here coming at you today from Scottsdale Arizona where I am checking out rental property and making fire content along with my partner rob a solo rob how are you today

well not well it's Friday I'm feeling great I'm excited to hit the weekend maybe catching a flick at the cinema by myself they have a little bit of me time how are you Sir

maybe check out bed bath beyond if you have enough time possibly

that's my therapy these days is going to the container store like I wish I could organize like this

speaking of bed bath and beyond we get into it with today's guest Jeff Gillooly in talking about how to furnish your short term rentals obviously short term rentals are all the rage I've jumped into that and bought several of them for myself Robbie here is a specialist in the short term rental game and this is one of the higher asset classes in our space so you often hear about analyzing the deal finding the deal managing the deal but you don't always hear about furnishing the deal so in today's episode we give you some really good advice about where to go to find the best furnishings that you can add tip were and hints it's not a bed bath and beyond rob what were some of your favorite parts of the show

you know this one is multi faceted first it starts off as a rental arbitrage lease arbitrage master classes like well we're really we're hitting the groove here and then all of a sudden we transition into furnishing and all the things you need to know the ins and outs horror stories method to the madness and everything in between and really Jeff really does break this one down it's a really really cool story he was a full time lawyer that basically six months into his short term rental journey decided Hey I don't do that anymore I want to be a successful short term rental entrepreneur and then even from their crushing it time and time again so I'm really excited to get into into this one

yeah we also talk about how Jeff had to transition from being a lawyer which is not a skill set that is conducive to being an entrepreneur into being an entrepreneur that moves at scale we talk about hiring about leveraging about growing at about overcoming the obstacles between your ears sometimes a stop us from making content so overall I would say this is a very solid show make sure you listen all the way to the end because we play a game called method or madness where Jeff gets into the method that he has used to a furnished rental properties before and if it drove him mad or if it worked all right today's quick tip is three words contractor grade

for

furniture in the show we talk a lot about buying at the right property as rob here would say buy nice not thrice you want to get something that will stand the beating that your guests are going to put on it and save yourself a lot of time and money in the future if you watch this episode alone that should give you quite a bit I you I know I had my eyes open to this fact is probably to save me a lot of money on the properties I've bought property the USA before bring in Jeff

I totally agree bye nice not thrice and use it use it to me just give you a little reason why because you gonna buy cheap furniture and then guess was gonna break and you gonna bite again it's gonna break again now we do have to get rid of the furniture it has someone to take it out and resemble a new one in the by the end of it he's by the nice one and you get you senator spending three times as much if you are just splurge the first time so listen to the episode take notes grab your pen and paper and get ready because this is this is a good one it's going to be very very eye opening for everyone that's looking to really get into this industry full force all right before we move on let's hear from today show sponsors when you're running your own business every single higher counts but most job sites don't get that they're just focused on throwing you leads and not finding you the perfect higher if you want a hiring partner who's incentivized by your growth work with indeed we can attract interview and hire all in one place with powerful talent finding tools like indeed instant match assessments and virtual interviews you're minutes away from finding the perfect employee aid with instant match as soon as you sponsor a post you get a shortlist of quality candidates whose resumes on indeed match your job description so join over three million businesses worldwide using indeed to hire great talent fast indeed knows that when you're doing everything for your company you can afford to overspend on hiring visit indeed dot com slash bigger pockets to start hiring now just go to indeed dot com slash bigger pockets indeed dot com slash bigger pockets terms and conditions apply cost per application pricing not available for everyone need to hire you need indeed single family home investors when the economy goes down lawsuits go up if you own assets in your personal name you are totally exposed but what if you could become bulletproof to lawsuits hold your assets anonymously legally pay zero dollars in taxes and create generational wealth in only six weeks in twenty fifteen Scott royal Smith joined us on bigger participants what one oh nine to talk about asset protection strategies now he's back offering a turnkey wealth protection system that gives you unlimited LOC entrust creation for a one time flat fee as a bonus you'll receive a free consultation with his in house team of asset protection and estate planning attorneys CPA's and insurance specialists who are real estate investors themselves royal legal solutions dot com has helped over two thousand single family investors protect assets in all fifty states why try to solve tax and legal yourself when you can get everything done the right way while focusing on what you do best making great deals royal legal solutions dot com is limited to thirty new clients each month so act fast apply for a free consultation at royal legal solutions dot com we all struggle with feeling like there's not enough time in the day to be productive personally or professionally we all struggle to make our time matter it's time to take control it's time to start investing in the corporation of you added Tina they've helped over seven hundred ambitious professionals achieve more by connecting them with best in class globally remote executive assistants a female executive assistants go beyond basic administration tasks they help you make time matter through the art of delegation they believe delegation is the super power of all highly successful people and your personal E. A. will help you get there your E. A. as a one on one long term partner to help you achieve your personal and professional goals take back your time join the waitlist at the fina go dot com that's Athena go dot com

all right let's bring in Jeff Jeff Gillooly and welcome to the bigger pockets real estate podcast how are you today

doing great how are you

I'm doing good too I'm in Scott still actually I'm here

looking at

potential rental properties can be checking out houses when we get done with this and then tomorrow as well I really like the area there was a crew Risi storm here last night we were doing a YouTube live it was like everything was fine within five minutes there's like a monsoon just tons of rain tons of lightning we're kind of staying up in the mountains right now so we're right in the middle of it it was an awesome experience and I'm not quite sure how I'm going to connect that to what we gonna talk about today I was hoping that as I kept talking there would be a Segway that would appear there's

I got it

okay

we don't worry okay so I think that monsoon with the guests that we just actually had at our Scott still property and let me tell you and this is by far I mean this is the full moon most of the home and high maintenance guest I've ever had in my entire Airbnb career and here's the Segway get ready for it Jeff tell us about your short term experience I know you I know you can manage quite a few short term rental you've probably dealt with a few I mean it's guests

in your time

yeah I think that's a very very fair thing to say so I've managed over two hundred fifty vacation rental units in a variety of different ways from I'm super super luxury homes all the way to apartment buildings and everything in between cabins you know beach properties and the the level of maintenance is always is always high the matter the type of property you can I can always get pretty high so I've I've probably had tens and tens of thousands if not hundreds of thousands of guests with a lot of crazy vacation rental stores

well that is okay that that's a bragging rights man to to even be in the tens of thousands I mean I I'm thousands and I was just on the phone with Airbnb talking about this gas like you know the whole the whole thing many layers deep into the customer service rep and I said listen I've hosted thousands of people case I don't say this lightly but I think this is the one and they they laughed and they we understand we can help you though as it noon so tell tales about when you got into Airbnb man

yeah so I got an Airbnb back around or vacation rentals that's T. R. industry two thousand fourteen I kind of started I was and am a lawyer but I was practicing law at the time ands really read an article for the first time about somebody doing arbitrage thought it was really interesting I had never thought about before and always loved the idea of being in the hospitality industry being in travel time and kind of started back then with my first property

so that was kind of the I mean I I consider that sort of the the wild west of Airbnb that the one point L. and then I think the next probably four or five years were sort of the two point know where things are getting more established and now we're sort of I don't see the final stage but it's a very different animal I mean would you say that there has been pretty pretty big paradigm shifts within the short term rental industry since that time

yeah absolutely I mean I think I think even thinking about twenty fourteen as as one point oh is kind of is is old is too too much I mean twenty fourteen was already three point oh four point out in the last twenty years of the vacation rental industry is has changed a lot you know I go to I go to conferences and and things and meet new people who were in vacation rental markets where it's customary to not make the beds right you just leave you leave the sheets you know and hang on the door guests used to have to twenty years ago the second pay if they wanted sheets so that even in the early two thousands to twenty fourteen was a huge shift I think we're definitely in a third phase from from that point bites you know right now is is still very much the wild west

that's only fair that's very very rare for I I kind of more like in it to the I guess like the the dot com era for like Airbnb and short short term rental V. R. B. O. verbal all that stuff so

yeah

okay so you got into the you get into real estate you saw this article this this this interesting concept of letting strangers sleep sleep in your home for a rate basically right so what from there to sort of kick you off to actually get into it and and what was that first unit like

so the the first first unit that I had I actually got that unit I was speaking with a friend who had some experience in the in the short term rental industry he's been doing it for a little longer than me based out of New York and we had this this this property that came up and we actually started that property under a management deal where a third party company was managing it I'm from New York for about three four months and it was a really interesting deal for a bunch of different reasons but I I learned a lot for those from those first three months about how management worked I'm seeing somebody else manage my own property but that deal was really really unique because I actually it was a lease arbitrage deal that I had a property management company running

okay so can you explain that for for people at home just so that we understand what is lease arbitrage

yes so we started charges essentially you go when you lease a property for X. amount banking on the fact that if you put furniture in it and rent it on short shorter basis then you know a year or multi years that you're gonna get overall higher return yeah nightly rates adding up monthly you're gonna get a higher month return then you would get after expenses which is your lease so it's the arbitrage the difference between your fixed lease amount that you're paying and what you're getting through short term rented the for metal street at least that's what these are judges in this industry

yes sure so basically let's say that it cost you a hundred dollars a day in rent to rent a property and then let's see got another twenty dollars in utilities a day you have to rent your property for more than a hundred and twenty dollars a day to make a profit basically right

that's right yeah and plus you know factoring in the fact they're gonna have to furnish the place you know maybe pay a management fee for to somebody else all those costs add up and ideas that you're gonna at the end of the month you're gonna net out more money than you're paying in rent and expenses

so as someone that actually started in rental arbitrage myself I this is me back in twenty eighteen twenty seventeen somewhere in there that's when I was just we rob built at that point but I was getting my I don't know is understanding what this would could be and I thought it was just a crazy opportunity to make a lot of cash flow what was this like in twenty fourteen to twenty eighteen only it wasn't even a new concept that that point twenty fourteen this must have been like man I feel like I'm I'm relieved to have won the lottery so tell us about like the the sentiment there when you're first getting started

you know what's really funny rob is that the sentiment twenty fourteen from everybody else we've been doing it for four years is four years ago you know this was five years ago this was a completely novel concept that nobody would have ever thought and and like this it's the same as what you're saying now I felt the same way I was like this is already played out this is already done but now looking back at it it was very different than it is now it was for lack of a better way to say it was him it was very hard to miss there was a lot of money out there you could put any kind of units up I'm with

you know

any type of quality level eccentric and they were going to rent and you were going to get up you were going to meet your your lease arbitrage number it was it was very very difficult to miss that demand significantly outplayed outpace the supply in the market

okay so can you tell us what we actually do and I will your full time career at this time were you already in real estate

so I was I'm I've always kind of dabbled in real estate on the side you know a little bit of like commercial real estate a little bit of residential real estate but I was a lawyer full time so that's what I was doing I did some real estate law I was doing transaction work I was doing business litigation so I was working at a big law firm and my day to day at the point when I started getting into the cage rental industry was

you know woke up super early went into the office worked a full day is a lawyer and then was trying to figure out how to do the case rentals at night and at the beginning you know I had a property management company handling my messages but during that transition where I decided to make the jump full time I'm you know quit I was doing a lot of the messaging from my phone you know in the office responding to guests you know doing pricing all that stuff you know on on coffee breaks and things like that so you know I was working full time as a lawyer when I started doing this

I always wonder how people do this I was in advertising so I always felt like my life was really flexible my career was very flexible and do yeah it's always crazy that like a lawyer could be managing an Airbnb on the side and David I don't what was like for you because I know you were out in the field your work in in the force at that time managing your your portfolio will you ever just shoot in text messages out out in like two property managers or was it pretty passive for you early on

no it was not passive at all so I very similar to Jeff I had to develop a system where I could communicate with people on the brakes that I had so part of it was training the property managers agents I was working with to communicate with me in the way I need it so text messaging was much easier no phone calls and I would prep them ahead of time so let's say that they had a house they wanted me to look at they don't just send me a link and say do you want to buy it it would be here's the house here's the rent here's the A. R. V. here's where I think we can get it for and I've loop the property manager in on that tax and the property manager with literally send a thumbs up icon or a thumbs down icon what regarding do I like the area or do they like the area so I could really quickly look at it and then I could take those numbers and either at a point I got to go through my head but at first I would for any calculator I can make a decision on yes or no and then I can just text back with the purchase price like hundred ten K. or two hundred K. or whatever that they would write the offer and then they would tell me it's an email and I could DocuSign it

so

as a cop you could literally be I go on a call I get done I get back in the car I look at my phone

everything is there I mean I send the tax I put it back in my pocket I move on to the next thing all of us have time throughout our day it does not matter how busy you are or we check our phone to text our friends or we checking email or we look at something on tick tock I don't you stick talk but I know a lot of people do most visited website yeah yeah if you tell yourself I can't do this I'm too busy that will become true

if you ask yourself how can I do this when I'm busy you will absolutely find a way and I personally believe that led to me being better at analyzing deals that led me to be a better communicator it lets all the concepts that are long distance real estate investing so I love hearing that Jeff had that same attitude it's just

I don't

this sounds cheesy to say about so many much of the time we talk ourselves out of what were possible love because of the stories we tell ourselves you see this with real estate agents they go to the office they sit there all day they don't contact any buyers or sellers they don't put anything out to draw leads they don't do any work to make the money they sit there they develop business cards they make marking fires a like emails and then they go home and say I work for eight hours a day no you sat in an office for eight hours you didn't actually do work but when you have that W. two mindset where you get paid just because you're at a place you start to think that's working that W. mindset does not work in this ten ninety nine world

where we are entrepreneurs where we have to we get paid for results and I I truly believe Jeff and I want to hear your opinion on this so many people don't work in any form of entrepreneurial environment because they can't break out of that thinking of like an assembly line worker like I'm here it's supposed to just happen I'm looking at houses on Zillow why have I not got a deal under contract yet but if one of us sat there and watched him do it we say that yeah you showed up at the gym and he didn't touch a machine the whole time

yeah I mean I I I can't tell you how much that resonates with me I mean that the concept of you know being being being productive with your time and like what you can do when you're really thinking about your time you know as a lawyer specifically I was tracking every minute I was billing by the minute so I was very conscious of what I was doing with my time so if I was sitting there for eight hours and I wasn't tracking what I was doing in billing it to somebody then I wasn't going to get paid you know I was gonna get my credit for it so I was very aware hyper aware of of time but you you figure out where you can fit in where you can find time and and honestly make you make the time a lot of the work I did in the first six months before I decided to jump was done from six PM to ten PM you know that that's a lot of hours you know you can do a lot of work late at night and I think what just like you're saying David the the the toughest part is that first you know you're sitting there you're paralyzed or deer in the headlights taking that first leap of faith is really really challenging and I wasn't you know as good as I was managing my time and being productive that was a really big learning curve for me I was not it did not it wasn't a natural fit right out the gate I was really risk averse lawyers are trained to be really risk averse and think the worst is gonna happen and everything lawyers in general make terrible business people for that reason alone you're you're terrible sales are really bad at you know at deal analysis because you think everything is that is going to fail so I I totally get that and that first little knowledge over over the edge to conduct to jump off the cliff it as it were like that's it's a big it's a big thanks

I see this with different locations like engineers so sometimes are my real estate team will be working with an engineer and and will find eight houses were gonna show him as a potential house hack we'll go look at the houses and they don't like any of them that area about how something it's it's obvious now and they're gonna want to follow up when we get done and analyze every house unplug all the numbers in the spreadsheet and see with our I would be and talk about like how they would do every house in the road you don't want any of them why why are we still talking about this let's put the energy into finding the next house and it's it's sort of a self awareness thing that you have to recognize I am programmed to think this way as an engineer you just have to solve problems you have to dive in and get the information and it's easy to forget why am I even getting this what purpose does it serve and when you get into the world of real estate investing her entrepreneurial endeavors in general you're always asking yourself does this matter is this important how important is this is this going to actually move the ball forward that's what it's like like little segue to cover this because so many of our listeners I'm sure are trapped in the matrix they don't realize they're just going through these motions without knowing they're going through motions and two years can pass you haven't made any progress it can become very discouraging so if you don't mind sharing what was your like red pill moment in the matrix where your eyes were open and you realize you had as a lawyer I am totally prone to seeing what could go wrong and I can't see anything other that and now obviously you're in a place where you sort of embrace risking your creative in your scrappy that we could not have been a natural process for you to go for where you work where you work now

it wasn't and you know to be fair I had a really great business partner when I jumped out of of being a lawyer I I'd I didn't started on my own I had somebody who was an entrepreneur who had some experience really kind of coaching me through those first couple months and it was really really hard you know I was used to being you know right about you you're trained as a lawyer elected to value your opinion your opinions right got to go with your gut and B. and then we enter into a totally different universe where you don't even you don't know which way is up and you're on a sales call and you have somebody tell you afterwards if I was the worst sales call it occurred in their life that's a tough that's a tough being so I had somebody kind of coaching me through those first couple months and I think that that was my first sales call was probably that that red pill moment where I was like oh I don't know anything everything that I just heard as a critique of my first sales call was one of the worst yeah I look at it now and I I I you know I I live in a great way but it was it was a good learning experience

so that was your first deal right when you're first starting out but how many deals did you eventually get to just that I have understanding of of like how far you went with this

so yeah I started with that first deal and then I did about the next forty deals as lease arbitrage and then after that it kind of became a mix about fifty fifty I was doing property management for other people and then I was doing lease arbitrage when we were at our biggest we were a hundred fifty properties by you know over that seven eight years you know probably a lot of those came and went so I set up and ran over two hundred fifty but you know sometimes especially with these arbitrage deals the last four to three years especially the way that I was doing it they will some of them didn't last forever but that was kind of a point

wow okay so we got back check here there's a lot lot to this store that I want to know so you went from one is that we did about forty so what was that I wasn't scaling because in my understanding of lease arbitrage is it's pretty tough to go out and find landlords that are like sure you know you could lease my place why not I I sure I could get the same rent from a long term renter but your pitch sounds great so how are you able to actually get into units because that seems like the the hard part for this niche within short term rentals

yeah I think that I think that that's right and I have a conversation with a lot of people about you know what's the best way to have a conversation how to approach a landlord you know for me I found a niche within a niche for those first you know forty properties and and kind of on going which was I had this wild idea I knew a bunch of real estate developers and they were really focused on flipping homes but they were flipping homes in nicer areas so they would buy a home that was decent about the market in that area had shifted in the market was really hot and so for them to knock down a decent home and build a much much larger home was going to be worth it in you know two three year flips and the problem was that when they would buy these homes they would have to wait for entitlements and wait for her to come through and that process especially out here in Los Angeles could be anywhere from a year to eighteen months to two years depending on what you're trying to do and how crazy it is and so the concept that I that I came up with was to you know just talking semi realistic friends was hearing that they bought a home from home owner that homeowner and moved out and you know because they were moving on

and

they were trying to figure out what to do with these homes they want to lease them out but they didn't wanna put long term tenants that they were going to have to maybe kick out in ten months and they didn't want to you know go through the hassle of you know figuring out what to do with it and so I reached out to people who were neat people who live there to needed this service specifically they needed somebody to come in and take it under utilized asset and figure out how to maximize it or how to make it work for them so I was leasing properties that were waiting for entitlements homes or wait for entitlements for flexible periods of time anywhere from ten months to you know two years saying you let me know month to month when you're ready to get the property back and I was able to leases properties it's significantly less than market right

wow so basically someone was gonna go

in

yes I understand and let me just say as someone who has built a tiny house AT you an accessory dwelling unit in my backyard I can one hundred percent vouch for how difficult it is just to get a it's like a simple permit or what I thought would be simple I was very green I don't know what I was doing but took a long time just to get the three hundred square foot structure yes hi I have a lot of sympathy for for the people that you want to do a tear down in a remodel so effectively someone to sell their house it and they're they're just gonna lose money on the mortgage payment they don't want to have the victim's body so you come in and you're like Hey tell you what I'll I'll at least here in when you're ready to kick me out I'll go and you're able to just pick up clients that where did you have a lot of notes along the way to

you know mostly it was yess honestly I I I it was the value prop we were bringing to the table was really strong a lot of the people's alternatives were were zero they were just not going to rent the homes out or we will also coming by understanding their pain points we were coming in with conversations like well you're a foot your flipper but you don't do management right like they don't have management a lot of these companies work property manager so we would tell them Hey look we're gonna Lisa Homer Lisa for less than market rent we're gonna give it back to whatever and if anything happens to the house

we'll fix it

it will never call you for any basic stuff

you know

if if it's a minor AC repair or a broken faucet or you know trump plumbing issue as long as it's not a major thing we'll just take care of ourselves and we won't even call you and so that was like music to

a real C.

developers years that was doing a flip they didn't they that's the last thing they want to deal with this is all upside for them so a lot of these deals are really easy to close

okay so were you with this all specifically in any kind of the head on a segment within Airbnb like luxury because I know obviously if you're building a house it takes a little bit of money to do that so I imagine we're we're these all these houses in more higher end areas or was it kind of across the board just at every single type of a I don't know price point

it was across the board I mean I had homes I mean I you know I eventually got to homes where I was renting them out for three four thousand dollars a night and I had homes that I was rooting for seventy eighty dollars a night

and

this was our truck model works for both because what would happen is it would be okay home in a decent neighborhood that was gonna be turned into a super nice so might a little bit older I need a little bit of touch up work and I would do like light work myself you know painting you know maybe putting down some laminate note in an area that needed a little bit of love but nothing heavy and then on the other hand we would get folks will call us Hey we just bought these for homes and we're waiting to get an entitlements to build an apartment building in this part of town do you want these four homes because they're just going to say we're not going to listen to anybody until we get it and the entitlement process to get an apartment complex you know the green light this year's so those are always great deals for us too but a lot of those or even some of the apartment buildings work were much much smaller much much more value units

well okay so tell me a little bit about your team here because I know there's only one Jeff right so there's no way that you can go and furnishing Paignton lay laminate on all forty units at imagine I mean the at this point once you get to that number you've probably left your job I think you mentioned six months or so that was that right

yeah probably like five six months after I started renting out the first property without management company yeah I I I I had I I remember having ten properties when I left my

job okay and so at what point did you start building out your team or what did that team look like tells the phases of it because I know from one to ten is going to be probably a different animal from ten to forty

yeah absolutely so I think you know you have to also remember in the context of the story PMS software was not properly means it's often the case rental history was not where it is today a lot of the solutions that exist like like who's G. P. my company now that didn't exist back then so things that make it easier to run the case residents so the types of help that you need were very different self the first person that I it was me my partner the first hire that we did remember twenty fourteen was a was a check in person we get all of our check ins in person for the first two years of this business

well

and it was because we were hyper vigilant about what was going on back then there was a lot more fraud you're in a really you know kind of metropolitan area and so there were a lot of like party issues neighbor issues things like that we want to make sure that we can get it off the ground right and we wanted to make sure that we were creating great experiences for gas and kind of that was in the remote check in thing was just getting started so the expectation was a little bit different people showed up be able to have somebody walking through the house and answer questions for you like that was really what generated a lot of positive reviews that we stopped doing that for a lot of reasons also I think became unnecessary and learn how to do that in other ways but so the first person was a check in person the second person was a maintenance person after that we had an operations person that did it all started doing a lot of messaging we hired a pricing person that was doing the full time pricing I should say before we hire the the pricing person we hired at something that we thought was really important was a ahead of ahead of quality assurance so this person ran our cleaning teams so the cleaning teams are all outside cleaners but we had somebody present at the beginnings and ends of the cleanings to run inspections to make sure that the properties were like in tip top shape so I had a cleaning and then after that you know your basic accounting another operations person into full time handymen that were kind of doing everything we did a lot of maintenance work in the tech community great check we would repaint units I don't know twice a year like pretty much any any issues any any maintenance issues just to make sure that they were always had this like fresh you know unwraps brand new kind of feel when you walked in

okay so you you kind of figured out the the team right you're you're kind of slowly assembling here I'm sure you have a lot of problems from that zero to forty right and I have to imagine going from forty two hundred and fifty that's gonna be a whole different animal with its own set of problems right

absolutely I mean I think that you start to get to the point one of the other issues why is it one of the big big problems that came from forty two hundred fifty was we started diversifying our business model so now all of a sudden we were doing property manager not some properties lease arbitrage on other properties in keeping track of like expensing accounting doing statements for owners figuring out who's paying for what figuring out how to track and what types of maintenance we wanted to do on different properties when we needed to get approval

the diversification of the business into the luxury space how we handled luxury units was so so so different than how we handle basic units so we really creating operating procedures that went across a broad cross of different types of business models and different types of properties was probably the biggest logistical hurdle from forty two hundred fifty just figuring out how to treat each of these properties and creating processes for each one it was it was really complicated

do you feel like at any point you went from being of a real estate company or like a rental arbitrage Liseberg Trust Company to an operations company or are they kind of one of the same in this in this business

you know I think that they're they're different there's a lot of people doing this arbitrage out there what is the best thing in the short rental industry passively reading you're not really involved at all there's a lot of people to take managing and working with their their property managers really really seriously and really hands on and there's people that are owner operators that do you know fifty hundred units on their own and I really think that the degree that you can the work with other property managers or do it on your own it's just a total sliding scale and it just depends on what you're on what you're looking for I think you can shape it however you want

yeah yeah make senses but seems like part of the growing pains of growing a company I mean it the I know you and I know you have a great team I remember we were having dinner not too long ago you like I've got a person because I got a person for this it's like wow this guy knows how to build a team I have something to learn here in that that's obviously one of the big proponents of of operation that's one thing that I'm figuring out right now all right before the next section of our show let's hear from today's show sponsors first impressions are everything so if you're looking to make an impact with online content you need to issue the easiest way to share engaging content everywhere you want to be seen issue is the all in one platform to create and distribute beautiful digital content for marketing materials and magazines to catalogs portfolios and much more make it once and distribute it everywhere your content is automatically optimize for engagement and ready to share that means no more reformatting resizing re downloading and re uploading it's a huge time saver end issue works seamlessly with the tools you already use like Canva Dropbox MailChimp in InDesign make your content stand out with so many issues get started with issue today for free or sign up for an annual premium account you get fifty percent off when you go to issue dot com slash podcast and use promo code bigger pockets that's

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nine RV camper RV resorts USA dot com you talk about a little bit for the listeners at home that are maybe struggling with scaling or the operation side how can how can people getting started really looking to scale the company how can they take on the biggest challenge in their operations

you know I think the first thing to do is not you know the first thing you got to do is see what's out there you have to talk to people you have to you know honestly that the Facebook groups the you know the coaching that's out there there are a lot of solutions out there and they're they're I think the first place that you have to look don't try to reinvent the wheel first you can reinvent the wheel I've I've I've had to do it and I built solutions and sits in areas that I didn't think made sense and that's a lot of like what I do now but I think the first thing that you want to do is start talking to people start talking to people in the community that's something that's available now in the short term rentals rental industry that wasn't I mean in twenty fourteen there weren't a lot of people to talk to there weren't a lot of other people in this industry to talk to as easily there are a lot of people in the street was very desperate there wasn't a big sense of community now is a huge community out there so whatever your biggest operation issue is first try to find a problem from somebody else that you a mentor somebody you appreciate that respect somebody that you can you know a group of foreign you can put that out there look for a solution that exists first

yeah great advice David you're also kind of the king here yet I feel like you have so many teams and so many points he points of contact for so many aspects of your business is I'm curious on your side when do you look to make that higher because I know that you're very good at staying lean to's so does every single hire her to or is it come from a point of excitement taxi and create a role that can sort of alleviate the load for the team I think personally that hires are scarier than they are exciting because we have done well in the role that that we are hiring for because if we didn't we would need to hire someone to do it just by very nature of being in a position that you can't keep up you did a good job and I think a lot of the reason that people do a good job as they're motivated for themselves so all of us when it's our own property we take care of it really well we're building our wealth it's our reputation now think about like you drive your own Cardiff in the drive rental car every employee is in some sense driving a rental car now that doesn't mean they're all going to trash the car when I drive rental cars are very respectful of my take care my I treat it like it was my own but I'm not naive enough to think everyone does that so it's very difficult when you get to that point trying to scale the because most human beings are going to put the effort into it that you did I was just saying something about this the other day with someone that we hired and they made a David they had a decision to make and instead of putting a little bit after into thinking what's the best choice they just did that the quickest thing they could and they were going to be defended by someone on the team and I said no look let me ask you something if this person was trying to figure out what restaurant they wanted to go to eat out tonight at minimum they would have yelped and seen what the reviews are it's okay to expect them to do that our company too they could have put that same effort into this decision they just didn't want to this isn't the right person to be in that position because when I got to watch every day and we're not gonna know what decisions are making so there is an element of hiring that just makes your job more complicated there's no way around that it's a different skill set but you gotta deal with it there is no way around the hiring the Bakul if you want to scale if you want to grow you have to be able to do this and that it doesn't benefit you to sit around and talk about like oh I don't want to grow because of all these reasons like if you want to grow this is what you're dealing with Jeff I'm I want to transition us into a little game here but I want to give you a chance to respond to the whole thought about scaling employees before we do

yeah I mean I think I think it's you you're spot on you know you're you're you're hiring for something that you just did it's hard to let go it's hard especially when you care as much as you do to expect other people to have that same level of care and I think as the more you can online it's something that I've done and and all of my business is is try to align your interest with your employees interests now a lot of times it's really it's easy to do in like a sales position right like your line is the commission everybody's aligned by a commission I used to do you know and when I see a lot of people do is you know align your cleaning company bye bye determining extra bonuses based on you know how many five star cleaning reviews you get or align your total compensation with the whole company you know there's a lot of people out there that do you you know equity for start ups and things like that but when one thing that you can do is actually give out quarterly bonuses which I I've done my company do my company now based on total growth self one like align your your employees as much as you can with yourself in your business and then the second point that that was like a more nuanced thing we said David that I that really resonated with me was that you treat your own properties the best right and that's for me starting a property management company after forty properties was not something I wanted to do but I had already built out a property manager company with the team for myself that was operating my units the way I wanted my units to be operated and so I was a building out a property manager team to handle other people's properties they were just coming in and I was like well I have this team already this is a good deal I should try to do this and that those properties fit into my system in the same way and so all of those procedures and processes were in place as though I was taking care of my own property and I think that that was a really nice transition to get in property management it wasn't something I was looking to do it just happened you know because of of what I built a right now Jeff

I have recently purchased a literal boatload of short term rentals I don't know what a literal but what it is but I thought that that would make rob laugh I think I've got like a probably fifteen short term rentals maybe seventeen by now either it's just clothes are coming down the pipe and for the first time ever I'm having to work through the fact that it's not like purchasing a normal house where I go I have a handy man go we're gonna punch list of inspection report and I turn it over to the property manager and they get listed there's a lot of stuff you got a bite to get these things ready and I am going to selfishly asking you to sort of teach me and the rest of us what are some methods that you have used to get a short term rental and short term rental ready to be put on the market we're gonna call this game method to the madness and we're gonna focus on purchasing for short term rentals so you can share method that you used this method could work for and if it is resulted in madness to you Robert you take question number one number one what wasn't easy access market place but not scalable Avenue you use at first

easy access market place probably literally Facebook market place I don't know if that just because it's a market place but it's easy to access there's a lot of good stuff on there and I definitely use that at the beginning that and Craig's list to kind of furnish my first couple properties with you know most of the day the basic items

okay so who should use this and how

who should use it so if you are setting up your first vacation rental property and you are dipping your toe you're not fully committed to this you just want to try it out Iraq I don't know if I recommend not for everybody but you know sometimes that makes sense you got an extra bedroom in your house you are trying to rent out a small guest house it's your first couple properties you can use market place you're not on a timeline you can wait you can wait you can find the exact items that you that you want and you have the time to drive around pick up those items on your own a truck

that helps yeah

so that that those are the types of people that I would recommend Facebook marketplace where you have a truck maybe or access to truck or somebody with a truck and you're kind of setting up one and two rooms for the first time and you just want to see what it's like

okay so if for if if you've done this several times can you talk about a moment in which this became madness for you

yes so I remember trying to do this on like the third property maybe and I my phone was just my tax I couldn't find any text message to anybody that I knew it was just a random numbers as far as as I could scroll because I had so many feelers out for like a bed and a bench and a and a mat and whatever I could think and I had no idea who was texting me for what or what address any of these things are at and I was like I'm spending hours trying to find you know three couches right now this doesn't make any sense

if I had a dollar Jeff for every time that I in my beginning my Airbnb career where my heart jumped when I was driving and saw an old raggedy piece of furniture was like well they could go my Airbnb I have enough money to buy a house because literally every time I saw dressers like I can paint that or feels like a free couch I mean the very first cut to head to my Airbnb was literally like a pull out details on Craigslist free and wow that one it was not easy yeah I would I wouldn't show put photos of that county was it was a little dingy but we made it through

I I'll tell you I had to I had some did you first my first couple units in addition to the Craigslist and other things I literally would be driving on the road and see somebody moving out of a lot of apartment or home and I've I am guilty of picking up a couple items off that street may not like it probably clean that and and you know pain didn't throw it in you know so you know that is obviously not able because you can't spend all day driving around but yes I've I've also it's taking things off the side of the road and try to pick some up

for everyone at the at home watching on you too but I'm just gonna throw over some some B. roll right here so you can see what my very first Airbnb look like and they don't look like this anymore but just just so you know it's a globe story for everyone that ever gets into this business Hey David how you take number two question number two what are some big box items that ended up being big flops

big box items that ended up being big flops I would say I went with I used to buy I kia sheets that was and and and pillows and and stuff and they were not great I don't know how to say that any better that was like my main thing I used to pick up from there and they were really things and they were kind of scratchy the guest and really like them I would get I would get complaints about how the sheets weren't good and I remember trying to upgrade and buying the more expensive sheets that they had at the time and then learning that those were actually way more expensive than what was out there in other places so big big box big slot

okay who should use this method

who should use the kind of I. T. M. F. N. I would say nobody

I love it hi David

you know I just there's like look I I don't hate on ikea they really helped in a lot of ways and I think there are certain things that are there that are great but you know a lot of their furniture items to you it's like you just learn that having an I. T. how do you know how to coffee table if it's just not going to last most of the time especially because you're in there and you're like well I'm here to save money and then you realize that you're actually losing money in the long run because you're wasting a lot of time and have to replace the items and all that kind of stuff down the road by and you know I I think that I kia furniture unfortunately the majority of it doesn't have a place in the case rental units and I don't think anybody should put in their units

I believe rob's famous line is a buy nice not thrice if you don't buy it you will to my YouTube videos well that isn't sweet Jeff I do want to say you have impacted my sleep all right the since we've talked I you have really changed the the this I woke up like this and it's all because of you because you're the one that told me about Brooklyn and sheets I never really heard of that of them and so we tell yeah we buy them now and this is not every I don't get anything nothing but they are the greatest sheets to ever touch my skin never and I have come from the dark side of like here and I was an ikea fan and now I cannot do it it's ruined sleeping everywhere for me I can only sleep in my bed now so thank you for that I guess it's a double thank you

you're welcome and they're they're they're fantastic I I I feel the same way about them did we touch on the I. T. a car story

you hit that just yeah had talked about that

yeah so so yeah that's kind of a scaling and stealing pain story also so I I remember getting to the point I took that idea sheets and except for a story to to come to the next level I was setting up sixteen units at a time and it was like one big set up and I'll never forget because each of those units of like two three bedrooms you're talking a lot of furniture and a lot of mattresses and a lot of everything else limits except for that I need it all at once and I had been in that at that point up to that point I was probably around forty fifty properties I have been running idea with my team to like pick up pick up items in past the market place world in the ideal world and I'll never forget this one day where I was with my team there were sixteen of us we were in ikea we had forty eight shopping carts worth of items to check out and it it was crazy the line went all the way around like through the store like towards you know towards like the entrance door you pick everything up and just the checkout alone took three hours I'm just like standing and then the payment came up and I remember asking Hey like this is like a decent amount of stuff you know can I get a discount and I'll never forget the woman just laughed and she was like no way like no shot like this isn't even close to what you would need to get a discount on the stock and I was like that's crazy but that whole day was the worst I mean from my employees wanting to literally never talk to me again because we picked up all the stuff we put in this U. haul one of the two U. haul one one U. haul in it and van that we had and the U. haul my my boy that was driving it ended up getting into it I got fender Bender and then there's like all these insurance issues that happened afterwards and we got to the place and it was like eight something at night and all of a sudden I'm like the sight of relief off like this whole crazy days gone like I picked up all the secure stuff here I am and then realizing that it was all in the U. haul we had to get it

all

out and return the you all at some point and then we have to build it and so was like

this call

just the amount of like packaging and opening and you know the time building it and the time unloading it it was one of the craziest forty eight hours of this one trip to ikea and I swore to myself after that end true to myself never never did again

oh man I have done that so many times you know that scene in wolf of Wall Street we're like Jordan Belfort's like selling the stock he's like come on you can do any like seldom in everyone's a crowded around them and everyone's like claps after he's done I went to I remember would take you one time with my one of my first business partners as like all right you take this card you go here and I was like a robot just grabbing like fake plants and cheap and doing this and like literally was just like the the speed at which I was doing this kind of mastered this product this process so many times he's like man I just felt like I watch Jordan Belford sell stocks I think I know man I'm sorry so we also had like five yeah I think that was the moment for him when he realized that short term rentals we're not gonna be easy is like how may I thought we just furnish this is like now no no the furnishing is actually the fun part it's the buying that's not fun and then the dealing with the boxes

I hear you're a hundred percent right I remember being with my team and we were in there and we're talking to each other like hated you got to extort look where's the mall and we were a little bit like we were speaking Swedish to each other because like everybody knew every piece of furniture that we would use by name and it was like I this aha moment of this probably is not right

are the mom the the the very difficult to assemble dresser

why is it so hard

I that's the one piece of furniture like if you're gonna buy something use on Craig's list its imam dresser because you'll never get those five hours back up moving on here to question number three does online shopping have its drawbacks what's the method here

online shopping a it can

be

good if done the right way the problems with online shopping R. one a lot of people don't know what they're doing so I think I think that there's a lot of little tips and tricks that that an effective online shopper will know how to do whereas a somebody who's kind of just entering the space and is in this kind of analysis paralysis of haters nine hundred different actresses out there Hey there so many different kinds of sheets might not be able to understand and then you end up not really buying from brands you end up buying off brand stuff that you don't really know what you're getting and you know a lot of folks that I talk to myself we'll go through things like I went to a big Wayfair phase rows buying wants to from Wayfair and it was literally playing roulette it was Wayfair relax probably order something I wouldn't be sure what was actually gonna show up it could be really good quality could be really bad quality I remember ordering a couple nights stands one time that showed up and they were literally they were like maybe like eight inches tall they were like for a doll house you know like they look big on the on the picture because they were presumed dead what a great price for night stands and then they ended up showing up and you know like I I I think we actually put we actually put them next to the bed that we were that we were buying them for for like a couple gaskets will damage replacing them I would put in there for a couple of guys because we thought that they might find it funny too but yes I mean you get there are some perils you know not knowing the quality of what your date getting playing roulette not understanding shipping timelines and how those work and how to buy things that are in stock not understanding what contract read furniture is in commercial grade quality furniture right there's a lot of things that fall under online shopping where is like if you were you know if you were buying through somebody like like even host G. P. O. you're my company right that that is a different it's only shopping but it's very very different and it's geared towards making that experience easier for people rather than like you know the other thing is like when you're checking out of the can Amazon or or an eye care whatever like thousands of clicks thousands of clicks you know I need a cheese grater you're buying one cheese grater and a time like that is also a peril of online shopping that we we try to solve but you know you can do it wrong you can spend a lot of time online shopping

okay I think actually covered everything there the method and the madness I love that phrase

Wayfair

roulette that was hilarious

I also had

my I. T. a moment in addition to you guys I was living with that another cop and I was working in law enforcement and I bought the I key thing and they had these like tiny little tools that you're supposed to use and it took me about three and a half hours to put it together and in the middle of it I realize I could have worked for hours of overtime and made like seventy five Bucks an hour at double time or whatever it was and I could about the nicest dresser ever and save money I'm never doing this again so you have to bring up all the time I kia please by PTSD in Swedish or something that's probably for less die

it's really get

all right next question here let's talk throw out rugs when has this gone well and when has this made you mad

yeah so I talk about this I I've I've had this conversation a lot of times like when is it time to throw rug out like when when how do you deal with rugs in your vacation rental units on the one hand rugs are great and they actually actually what might background in my family's background is actually in drugs so like I'm old I'm always thinking about rugs rooms but what a lot of people don't understand is if a gas make every guest makes a rug dirty and it's in a high traffic area is still something on it whatever it is you can probably pay two hundred dollars response how much it is out here and to have somebody come with a special vacuum and shampoo the rug cleaning that rug is never gonna look as good as a brand new two hundred dollars and so that thought here is when

what

items are when you really need to replace items in a vacation rental you know how often how often you need to be throwing out roads how often do you need to be you know replacing our linens and so what what ends up happening is even if you buy a washable rod you we'll go through I know washes where it'll start to fray and you really have to be okay with understanding that like at a hotel or like any other you know nice accommodation people are paying in expecting at that level of service and quality when they show up and you need to make sure that you're replacing the items that are starting to get worn out enough regular and frequent enough basis rugs especially because that it's usually the first thing people see when they walk into a room or like when they walk into an entry way and if that doesn't give off this clean pulled together new you know five that's going to reflect negatively and and set the tone for the rest of the state

I you know I haven't thought about this enough as you're talking I'm starting to get chills in my stomach like I've looked at the house I've looked at the deal I've looked at the numbers I haven't thought about richer and how much I'm gonna go through rob's laughing it's like he's like oh I remember back when I was in a city naive and I didn't think about what okay a lot of rugs in these houses some of them are these like like faux bare skin really thin rugs and like that's going to be completely ripped into pieces and trash and they were all expensive when we picked him out so I wish we had interviewed you before I had picked out the furniture because this is a good step I mean obviously I guess are going to treat it super well what's you know before moving to the next question what's just a quick

like

universal piece of advice that when you're picking out furniture picnic or picking out whatever you gonna call this for a rental property that L. O. rule people could just live by that if you get this right over all you'll be okay

I mean I've I really like rob's you know by one size

by night I buy now it's not nice

right that's a that's a really strong one I think the other the other kind of game changer rule is by contract furniture really really focus on contract free furniture or just the idea of commercial grade everything right you want commercial grade in your house your home it's not this this is this is the concept that I think people just failed to grasp a lot of time and I did for my first hundred units right do you really need to think nice doesn't just mean expensive nice means like right for what you're doing you're creating a commercial space people are coming and going the way that somebody's gonna use that couch they're gonna drive it like a rental couch and they're gonna sit in it open it and close it you buy a pull out couch from you know your normal how many times expect somebody like a friend or somebody's coming to stay in your own home to stay in that couch right maybe open nothing to three times a year that's what it's built for that applies across the board those vacation rental pull out couches

get

open and closed every day at least a couple times a week right the cleaners open and close a couple times the gas to open and close it they might open close it multiple times during the day right so bye nice really means by linens that are gonna go through another washes by you know a country furniture that's going to be able to not break can withstand people standing up and sitting down in their specific types of furniture yes is a big thing we talk about with those G. P. O. two is just like educating people on what those kinds of furniture art that you should be putting in your homes so the the one takeaway is treat your space like a commercial space and buy that property

is there a quick answer to where you can shop to find commercial grade stuff or is not that easy

yeah I mean so the show host G. P. O. you know our buying group is really based on focusing on on only identifying companies that have at least price items contract rate furniture if you're buying on a site like west elm you know he throws you P. O. or not you can sort by contract rate it's a filter most people just don't know what it is so again online shopping can be good if you know how to do it and filtering by contract rate especially when you have that luxury and that ability is a great way to do that so again you can do that sometimes it's not generally available so like when it is a good example of that like especially if you're running dozens are you know fifty or a hundred listings linens can get a little bit challenging because commercial grade limits aren't available to the general public a lot of the time so some something like that you would have to join a buying group you know to to be able to access

yeah I think I also got some buyers are some contractor grade things from Wayfair in the past that's typically when I go to Wayfair it has to be contractor grade just because like you said Wayfair roulette right you're not really sure what you're gonna get I've had some pretty good luck on their purchase like several vanities and and things that are actual like and critical components to houses in September they've held up pretty well for me

to be fair contract rate isn't like that it's a great term but it doesn't mean the same thing everywhere it's kind of like saying you know artisanal you know that that artisanal pizza or ice cream or whatever might not be the same in in two different areas are two different places depending on where you are self yes certain certain people with actual contractor designations that do the testing on those products like those products are game changers

well I for one am a big fan of artisanal couches my favorite in the game we can end here we can and we got one more question here

sure

should you balk at buying in bulk

absolutely not buying in bulk it doesn't necessarily mean buying hundreds of everything it means buying enough that you can qualify for some sort of discount pricing and there's tons of benefits one you can access additional discounts that you were gonna be able to get otherwise and to you'll be able to keep an inventory in your home that would prevent you from doing the worst thing you can do indication rentals I'm a really in your life which is panic buying so that really goes to your you know how to store because you had to guess checking in and you're missing a pillowcase so you go to the closest store to buy two pillowcases all of a sudden you're paying double for those pillowcases or those sheets or those towels they're not going to match what you had the first time you're gonna have to you know it exchanged out if you want to create like a unified experience and you're gonna pay through the nose for it and you know that's the worst worst thing you could do worse if you had an injury happens sort is pull anyone out keeping up a closet full of replacement items and buying a book about way is it real real trick to you know operating successful profitable business

well that is the the the cube masters unlike the Camargue any talks about that means that whatever I say he always buys like the big version of staff right is accompanied by Tuesday so let's see so I just buy one thousand of them not skinny I don't even say that exactly but maybe

I don't know he said he's got a lot of stuff like that his whole thing is like you know why would you buy one toothpaste when you can buy a pack of five for like the cost of one and a half you know that's just that's just you're gonna use the toothpaste you're gonna use the sheets staying so you might as well you know you're you're pretty much over paying four times on your on your toothpaste if you really think about it that way you have to buy hundreds you face because you might not

you

hopefully get there often but you might not it's just you know you don't want to buy one

do you just keep those in the owner's closet and he's keep restocking from that same place

yeah I usually will have you know at least a handful of items in our closet and then we have you know once we got to fifty plus units we are having like warehouses where would actually hold in a lot of you know like are kind of members and host U. P. L. they all everybody has their own different way of doing it and warehousing is a really nice option when you can get there

yeah we'll say man I I bought like fifty I got book sheets from a I remember where but it standard textile yeah and it was kind of expensive because you know I don't need like twenty pairs of sheets or whatever but it is super relaxing to ordering sheets and re ordering seeds David you're gonna learn this fifteen times over here in your portfolio it's very inconvenient when your cleaners like we order sheet you like on it okay they stay now they need to order now so just having like a lot ready to go actually is really quite quite a relief to not have to worry about sheets for like the next year too

yeah I mean standard textiles a great is a great example of that there's so many benefits that like you just don't know if you don't know you know like I love your cleaner telling you Hey we need to replace the sheet you're like what size is it and nobody can figure out but if you look on the inside there's a color coordinated threat there's a color coded threat that says like green and that means twins so they go in they grab a green inside you know those are commercials he was our hospitality sheets and like you know Robbie had a positive experience buying through throws GPO that kind of stuff I mean that's what we made it for we need to streamline ordering process

yeah at at scale you can have to do it so yeah this is been fantastic thank you very much for sharing such helpful details here I'm gonna move us on to the lacks of get over so it is the world famous

famous

in this segment of the show we ask every guest the same for question every time and I will start with the first one question number one what is your favorite real estate book which is a letter is because I think you said earlier you've never read once I'm curious if you can answer this

you know I am you know I don't know five I've read like real estate textbooks in classes you know commercial real estate except for that kind of stuff but I've heard great things about the bird Bible throw that out there are a lot of folks who have been writing really really great short term rental you know guides I can like I mention at the beginning this podcast I had a great mentor who I was lucky enough to walk me through a lot of the stuff but back then most of these books worn around so you know I think that that you know I've heard great things about about the bird book I've heard great things about and I have Avery Carl's book on my shelf that I've been meaning to get to so there there are a lot of really great

resources out there specifically for short term rental company so I I would throw that out there

K. awesome question number two herbal number two if you will what is your favorite business book

my favorite business book there's two the one that comes to mind right now is probably getting the S. which I really think it's a great great book on how to think about to go she Asians it totally reshaped how I approach conversations with people and I think that for anybody that has to everything is kind of an association when you think about it at the end of the day every deal you're gonna sign every you know every vendor you work with so I think that's a really good one if you haven't read it you should

when you are not out there creating rental arbitrage empires what are some of your favorite hobbies

hobbies so I play music actually so I'm a I'm a saxophone player so I like to play shows whenever I can and and it's kind of jam out with friends that can travel probably my two favorites

all right in your opinion what sets apart successful investors from those who give up fail or never get started

I think a successful investor is someone who is willingly ready to have it whenever that needs to happen so I think any anybody who has a strict mindset and is rigid on this is what I'm gonna do and is on willing to actually look at the data in front of them or look at what the deal is in front of them and what they were hoping for is destined for failure and I think that somebody who is flexible and treats each deal each deal any property like a snow flake is as what more likely to succeed

awesome lastly Jeff tells where people can find out more about yeah

yeah so you can check out host G. P. O. dot com that's our buying group for vacation rental companies there's a bio about me on there I if you sign up you'll be able to chat with us chat with me and learn more about kind of my experience and you know how we got to starting his jeep yep

awesome David what about you man I met David green twenty four all over social social media please if you have me reach out to you and ask you for your money or crypto or some amazing deal that's not me I will never reach out to you as a stranger with an opportunity like that so be careful because I get new accounts every freaking week trying to work on getting that check mark so that doesn't happen but that's hard case no one's ever heard that there's so many scammers out there that we got to do something about it and then my you tube channel is David green real estate Robbie how bout you Hey by the way I see your you tube channel subscribe creeping up there man you do a lot of lives maybe can have me on one dance to wait for you to follow me back on Instagram it's all good man you can find me on Instagram at rob built hi I need to bat rob built and on tech talk at rob will tell I think I did fall you back did you actually asked me for like ten grand or something I wired it to you not that long ago oh no you still for the one thing that we tell people not to fall for all the time

yeah

Jeff thank you very much for coming on here really appreciate this is some great information and selfishly I think it'll help for me because I'm already thinking about oh boy I need to figure out how to get commercial grade furniture linen sheets tiles all that jazz so this came at a very opportune time I'm hoping to put a couple properties under contract while I'm out here in Scott still so that might be the first place that I can put this to use really appreciate you and thank you for being here hopefully we can have you back again

of course my pleasure this is

David green for rob bye nice not thrice up a solo

signing all right

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