Cold open

SPEAKER_00 0:00

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SPEAKER_01 0:28

Welcome to Live Let Thrive, a podcast about the Airbnb life, the share economy, and everything in between. Here are your hosts, Micah and Steve.

SPEAKER_00 0:39

Hello, hello, hello, and welcome back to another exciting episode of Live Let Thrive.

From accidental Brooklyn landlord to $1,500 rent on a $650 mortgage

SPEAKER_00 0:46

It is only me today coming at you, but I have a very, very special guest. I have author, short-term rental host and podcast host, Avery Carl. On if you've uh if you know anything about short-term rentals, you gotta know who Avery Carl is. One of the one just released a book, I believe. So uh uh Bigger Pockets book. So uh let me introduce you guys no other than Avery Carl. How are you doing, Avery?

SPEAKER_03 1:10

Hey, thanks for having me on. Doing great.

SPEAKER_00 1:13

Thank you. Thank you for coming on. I know I know we had your husband on, I think when we first started, which was like three or four years ago.

SPEAKER_02 1:19

That was a while ago.

SPEAKER_00 1:20

Yeah, it was a long time ago. You guys have really, really grown since then. So I'm excited to have you. So just backstory. How did you get guys to get started into the short-term rental space?

SPEAKER_03 1:30

Well, it was kind of by accident, which I think is similar to a lot of people who end up in the space. So uh we had bought one long-term rental at the time, and uh that was also kind of by accident. We were moving from New York City to Nashville, and our agent at the time is like way before I got license or anything, was really trying to get us to buy in this super fast appreciating hip area of Nashville. And we were like, no, we don't want to buy right there because we just came from Brooklyn. We're sick of neighbors. If we're moving to Tennessee, we're moving out in the country. So we did. And uh we thought, well, you know, maybe there's something to that, all that appreciation. We've got a little money left. Maybe we should buy one of those houses and see what happens. And maybe we'll uh take that money years down the road when our future children go to college, all that appreciation money, we'll sell it and pay for their college, and we're gonna be like the smartest people ever. We're like so personal finance geniuses here. We're gonna do this. So we did. We didn't even know it was called real estate investing at the time. And that first house that we bought, uh, the mortgage on it was $650, and we were getting about $1,500 in rent for it. So it's pretty good deal for uh long term. And uh, so once we got that first rent check, we were like, oh, wait a minute, this is something we want to build, we want more of this. So then we actually started educating ourselves on the subject of real estate investing and reading all the books, listening to all the podcasts, and we had just like barely enough of a down payment for one more single family left. And we said, well, what can we buy where that's gonna make us the most amount of money the fastest? So we landed on short-term rentals, but we did not want to do that in Nashville because Nashville has really, really volatile short-term rental rules, and we just didn't want to deal with that. It was like changing all the time. So we said, Well, where can we go that is a place that it's just the normal thing for when tourists come to this place to rent a house or a condo rather than a hotel? So we landed on the Smoky Mountains because we'd just been there and we'd stayed in a cabin. We said, Well, everybody go that goes there stays in a cabin. Somebody owns these cabins. Why can't we own a cabin? So we bought that and figured out how to self-manage it remotely. Back then, there weren't all these courses you could take and YouTube channels and all these things that make it really easy to learn. We had to just figure it out. And um, that first one went really well. And so we bought five more. We scaled pretty quickly with a lot of creative financing that I can get into if you want. Um, got five over the next 18 months. Now, five years later, we have 105 doors. Eight of them are short-term, and the rest are long-term

Scaling to five cabins in 18 months: 401k loans, HELOCs, and 50-50 partnerships

SPEAKER_03 4:12

multifamily.

SPEAKER_00 4:13

Woo, that is awesome! And yes, I definitely want to get into that creative financing. So, how did you after that first one, how did you scale up to the five more after that so quick?

SPEAKER_03 4:23

Yeah, so I guess maybe not necessarily creative financing, but creative down payment coming up with. So the first one, we did a 10% down vacation home loan. The second one was a 15% down investment loan, but Luke took my husband, is his name is Luke. Um he took a uh loan against his 401k for the down payment on that. Third one was again a 15% down investment loan. And I cashed in my 401k, which was nothing. I'd had my corporate job for like three or four years. There was nothing really in there yet. Um, and we got a HELOC on our primary home. So a little bit of cash from a couple different places there and uh for the down payment on that one. Then we were out of DTI. So for our next two, we had a partner who was we did a pretty standard money guy, sweat equity guy partnership where our partner Pavon got the mortgage in his name on both of the the next two, and we did all the management and all the setup and everything, and we split 50-50. But before we got to that true 50, we also had a mortgage on top of our 50%, where we paid him X amount per month until we paid back what would have been our half of the down payment, and then everything was 50-50 from there.

SPEAKER_00 5:40

Wow, that is that is awesome. You said a 10% down vacation home loan. Are those still out there?

SPEAKER_03 5:46

They are still out there. Uh, they're definitely Fannie Mae has definitely, because they are conventional products, has definitely caught on to people using them as investment vehicles, even though like

The 10% down vacation home loan and Fannie Mae's 65-mile rule

SPEAKER_03 5:58

a lot of people use them. You have to, you have to want, you have to be planning to use the property as a vacation home for two weeks out of the year. So we definitely met that qualification on ours for our first one. So you want to make sure that you're following the rules on the vacation home loans. They're still out there, but now um the interest rate is the same as if it were a conventional investment loan. So not as many benefits as there used to be, other than just the down payment is lower, which is most important to a lot of people.

SPEAKER_00 6:28

Yeah, exactly. Now, can the property be anywhere or does it need to be in a vacation rental market?

SPEAKER_03 6:34

It can technically be anywhere. And there's not a straight Fannie Mae rule about how many miles it has to be from your primary, but you're you'll hear when you research it, it has to be 65 miles from your primary, it has to be 50 miles from your primary. But ultimately, it really just has to make sense. Like you cannot buy your next door neighbor's house and call it a vacation home. So it does have to be away, but there are exceptions. So, like what we see a lot is people who live in Knoxville who want to buy something in Pigeon Forge. Well, that's only about 40 miles away from each other, but the markets are vastly different. Knoxville is very much like a small, medium-sized metropolitan market where Pigeon Forge is very much a vacation destination and it's mountains and a lot of stuff, vacation stuff that is not in Knoxville. So we see people from Knoxville getting second homes 40 miles away in Pigeon Forge all the time. So that's allowed. So it has to make sense for the underwriter. And you know, so you're not buying like your whole neighborhood and calling it a second home.

SPEAKER_00 7:33

Gotcha, gotcha. Wow. See, and I've never used one of those loans, and I'm definitely looking into doing that because I'm mainly using the burst strategy, but I was like, I could just do 10% down, you know. Okay. So now which is better? Because I see you have long-term and short term in your portfolio. Which are you like? Which is more passive for you?

SPEAKER_03 7:51

The long terms are definitely more passive, but the short terms make exponentially more money. And the short terms, yes, they are more work, but it's not hard work. It's definitely not, you know, sitting at a computer all day doing an engineering job. It's answering a few text messages here and there. And there's there's like so many automation tools now that make it so much easier than when we started. Like one property, one short term will probably take you like 30 minutes a week if you use the right software.

SPEAKER_00 8:21

That is true. That is true. Now, why now, okay, why haven't you turned those long terms into short terms? Is it location or what is it?

SPEAKER_03 8:28

Yeah, so that's a really good question. I'm glad you asked that. Um, for my short terms, I like to stick to vacation destinations. So our short terms are in the Smoky Mountains in Tennessee. We have five there. Uh, we have two in Destin, Florida, and we have one in Cape San Blas, Florida. And I guess we have one also in uh 38, Florida, which is just the east of Destin. So these are all areas that there are more vacation homes than there are people who actually live there. The regulations are really, really safe and established for being pro-short-term rental because there's not a lot of hotel presence in these places, and there's not a lot of primary homeowners whose income does not depend on tourism. So um our long terms, we have them in uh Alabama and then uh Chattanooga and some places in the Midwest. That I just don't like to mix metro markets with the short term because I guess maybe because of selling real estate in Nashville when I first started and dealing with all of seeing all of the stuff go down with the city council members and you know, areas where it hasn't been the normal thing for decades and decades for people to come stay in short-term rentals in metro markets, like in Nashville or Chattanooga, even or Birmingham or somewhere long-term up until 10 years ago. Everybody who came to those cities was staying in a hotel. And then Airbnbs are new things as of the past 10 years. So you have all this push and pull with the local government to try and figure out what to do with these things, how to monetize it, how to not piss off the people who live there. So I don't want to mess with all that. I'd rather go, you know, buy a house in Destin. I'm sitting in Destin right now, actually, is where we live. And Destin has had the vacation rental since before we had electricity. I like that because the rules are very established. You don't have to worry about all that attention and friction. So I do not mix my short terms with my long terms. I like my long terms in medium-sized metro markets and my short terms in regional drivable vacation destinations.

SPEAKER_00 10:26

I love that strategy. And the reason why is with, and this goes back and goes going to go into my question because I noticed with COVID, you know, a lot of even the metropolitan areas and the subsidiaries, they were getting a lot of traction. But one thing that really turned me towards vacation rental markets, and maybe you, and I want you to touch on this, was I'm like, okay, all these people are doing these staycations, right? Um, they'll just leave somewhere and go. Did that drive up like the the uh traffic coming to the vacation rental markets? Like, oh, I can go to sit in the desk in Florida for a week with my kids, they're virtual learning, I'm remote. How has that affected like you know, those vacation rental markets?

SPEAKER_03 11:04

So COVID definitely caused a boom in the type of market that I focus on. I know for short-term rental owners in metro markets, it caused a decline.

COVID's 10% nightly rate bump and the extended shoulder season

SPEAKER_03 11:13

And then for short-term rental owners in the big markets that you have to fly to, like Hawaii, Aspen, those places, the downturn also because people didn't want to get on planes during COVID. But for us, since the majority of the tourism that comes to our markets anyway, is driving and always has been. Uh, in our beach markets, it did extend the season longer because we're always booked, you know, Saturday to Saturday, seven-day bookings all summer and during spring break, but it did extend out until much closer to Christmas because people now that they're working remote, school remote, all that you have more options as to when you can actually go places. So it definitely did impact that. And then it also impacted our prices per night by quite a bit.

SPEAKER_00 11:54

Wow. Now, how much were you like? Do you know like a percentage of how much you guys were going up per night with that?

SPEAKER_02 12:00

Um, it just I would say yeah, it depends on the market, but I would say a good 10% conservatively.

SPEAKER_00 12:08

I love that. That's that is crazy. Wow. So yeah, see, I need to look into a vacation rental market because that that's the reason why. I'm like, because it doesn't seem like that snowbird season that a lot of them have, it kind of dissipated with the whole COVID thing. So right now, in this since you're in uh Destin, are all your short-term rentals, are you remotely managing them?

SPEAKER_03 12:30

Yeah, so well now that we live in Destin, we can technically like drive to them, uh to the ones that we have. Here we've got five in the smokies. We we're we're basically remote self-managing, even though we live near some of them now. We didn't used to. We used to live in Nashville and you know we're at least three hours from any of them, but we're all it's not like we're going over there and fixing toilets or anything. I don't see it unless I just happen to be heading to Whole Foods and want to drive by and look at it or something. But I would we remote self-manage all of them.

SPEAKER_00 12:58

Okay. And what does your team look like to manage all your units?

SPEAKER_03 13:02

So uh it's mainly my husband Luke does all of our management. I handle like all of the short-term shop sales agency stuff, whereas he's doing our management. So it's him and then he has a VA who helps him

Managing eight properties with one part-time VA from MyOutDesk

SPEAKER_03 13:17

with a number of different things in our real estate investing business, but part of his duties are helping with answer the short-term rentals, uh, you know, questions from guests between eight and five. So it's him and one VA, but that VA is not full-time dedicated to the short terms. He's dedicated to a lot of things. So I guess what I'm getting at is to have eight, it does not take a full-time VA. It a part-time VA would be fine.

SPEAKER_00 13:43

Wow. Okay. And then their VA, how has he been with you guys for a while? How did you find him? And yeah, how did you guys find that VA?

SPEAKER_03 13:51

So uh we have five VAs total within our businesses. I have three uh that work with me, just some of my um A, like personal assistant stuff, and then B with short-term shop and mortgage shop stuff. Um, we use My Outdesk, which is a company, they're offshore VAs, they're in the Philippines, and uh, but it's an American company. Daniel Ramsey is the owner of it, and uh they're all real estate specific VAs, so not just real estate investing, real estate teams, real estate agents, some of them are transaction coordinators, which those of you who are real estate agents will know what that is. Um, so they're all trained in real estate and they're all like uh graduate level um educated and it's very affordable. They don't have part-time options, they only have full-time, but uh it's really affordable. And I like could not live, I would move my VA, I would like move her into my house with me. I love her so much. Like she's amazing.

SPEAKER_00 14:51

Wow. Yeah, see, and that's what I was I've starting to notice when people go and try to hire a VA themselves, they gotta kind of scream. I suck at hiring people, right? So I'm looking for I'm looking for like a resource, like you said. So myoutdisk.com, let's say that VA is no longer works there. Do they go and get another VA for you?

SPEAKER_03 15:09

Oh, yeah, they do everything for you. You just tell them what is most important to you. Like, do you need somebody who can do social media? Do you need somebody to do uh help like cold call deals? They have those people, like if you want to like pull lists and have someone cold call, uh, you just tell them what's important to you and they'll set you up a um an interview with like they start with three and you interview all three of them. And then if one's a fit, great. If not, you say, I don't know about this. Can you set me up three more? And then they'll just keep setting you up. It's a huge, huge company.

SPEAKER_00 15:39

Wow. That that that I hope our listeners got that because that is a very, very good way to do it. Because I I suck at hiring, and then if they go do it for you, that is all the more better.

SPEAKER_03 15:49

Well, yeah, and then the VA is also they have somewhat it's like a corporate job for them. So you're their client, yeah, you're their client, but um, you know, they have an HR department to answer to and things like that. So it's not just uh you're hiring some random person off the internet and hoping that it works out.

SPEAKER_00 16:07

That's awesome. Yeah, because that's been my problem. It hasn't been working out. So, okay, so the short-term shop. Can you go into that? Is your podcast and I think it's a program as well, right?

SPEAKER_03 16:19

Yeah, yeah. So we have a lot of things. Um, mainly we're a real estate agency, a real estate team. So we have 30 agents on our team and we have offices in 10 markets. We're actually opening another one on Friday, and basically we are real estate agents that focus on working with short-term rental investors. So if you buy a property with us in any of the markets that we're in, we've got a whole back-end training program where Luke will teach you everything you need to know about managing your property remotely. So while you're under contract. So, you know, if you're gonna buy a short-term rental anyway, you might as well come to us, we'll teach you how to do it in the process, all while you're under contract. So by the time you close with us, you're ready to like you're off to the races. And we've got like a private uh members-only short-term shop, it's called the short-term shop buyers club. Um, only our clients to kind of share information. And because we have clients from every experience level, from like people who just got under contract last week to people who own like 30 paid-off short-term rentals. So we have them all in a Facebook group together where they can kind of help each other. But yeah, we've got a whole if and that all of that is free and just a value add for our clients. So it's just, you know, like hiring any real estate agent, we get paid on the commission, teach you how to do it, and you're rocking and rolling in any of our 10 markets.

SPEAKER_00 17:35

Whoa, that is powerful. You're basically, hey, you want to be in the short-term rental space, you can buy a property, we'll just teach you how to do it. We take our commitment. That is powerful. Now, what markets are you in?

SPEAKER_03 17:46

So we are in the Smoky Mountains in Tennessee, Blue Ridge, Georgia, Gulf Shores, Alabama, Galveston slash Crystal Beach, Texas, uh, Broken Bow, Oklahoma, uh, the outer banks of North Carolina, the high country of North Carolina, so Boone, Blowing Rock, Banner Elk, Sugar Beach Mountains area. We're opening Carolina Beach on Friday. And then we are in three markets in Florida. The biggest one is the Emerald Coast, so that's Destin, Panama City Beach, 30A area. Just east of that, we have the Forgotten Coast, so St. George Island, Cape Sanblast, Mexico Beach, Port St. Joe area. And then last, we have what we call the Disney market right outside Orlando, Kissimmee and Davenport area.

SPEAKER_00 18:27

Wow. Now, which of those markets is the most affordable for someone just wanting to hop in?

SPEAKER_03 18:33

That's a great question. Um, in terms in terms of returns, they're all very similar returns-wise, but the purchase prices and the gross annual incomes will be really different. Uh, the most affordable is probably gonna be Orlando. Um, the most affordable beach market is gonna be Mexico Beach, Florida, or Crystal Beach, Texas. And then the most affordable mountain market that we're in is the high country in North Carolina.

SPEAKER_00 18:57

Wow, Orlando is very affordable, more affordable than the rest of them. That is that's shocking. Okay. Now, do you guys also have like different lenders that you work with for like down payment, things of that nature?

SPEAKER_03 19:08

Funny that you asked.

Mortgage Shop brings short-term rental loan products in-house

SPEAKER_03 19:10

Uh, it's almost as if you did your research. So uh we actually have last year, we we were having to like send all of our clients all these different places and to like call all these different lenders and figure things out. So we actually started a mortgage company called the Mortgage Shop. So it's in-house, and we worked really hard to bring all the best short-term rental specific uh mortgage products in-house so our clients don't have to run all over hell trying to find them. We've got them right here for you. And all of our loan officers have done a lot, like are very experienced in short-term rentals. So a lot of times people will get caught up in interest rates and then they're like going with quicken loans and things like that. And then you get halfway through and they can't get it closed because they don't know what to do with a short-term rental. So uh we partnered with a lot of our past loan officers who we would send people to anyway when they're with different banks and just started our own. So everybody's very well versed in the short-term rental space, and we've got short-term rental products, so everybody has it all in one place.

SPEAKER_00 20:10

Wow. I'll I'm I'm I'm gonna have to join that. I'm gonna have to look at this because we're close.

Crystal Beach, Texas: the $500k five-bedroom post-Ike opportunity

SPEAKER_00 20:15

I'm closest to Galvelston. Um, how's the how's that market looking? Because I've never now Steve's really he's really in love with like uh I think it's South Padre Island, but I've never thought about going to Galveston.

SPEAKER_03 20:28

Yeah, yeah. South Padre is beautiful. I've been to both places. So my favorite is the it's the Bolivar, Bolivar Peninsula. I don't even know because you know Texans pronounce everything a little different. Um so uh that the Bolivar Peninsula, which is like Galveston's here, and you go kind of around and it's got you. Uh it's Crystal Beach. So Crystal Beach is uh it's probably my favorite beach market right now. If I wasn't under contract on a 68-unit apartment complex, that's where I would be buying. So it got run over by I think Hurricane Ike pretty bad. And uh it's just now being rebuilt. So a lot of the infrastructure is kind of catching up. So the real estate is affordable, but it's all brand new construction and really cute. And the numbers, if you look at the air DNA numbers, which is like, you know, the not it's not like the best, most accurate data in the whole world, but it's a really great like equalizer. Like you can compare everything, all the different markets and kind of see what they're doing. But if you look at the air DNA numbers for Crystal Beach, they're really, really good. Like you can still get a five-bedroom beach house, like one one tier off the beach with a view for like 500. So um that's a really, really great spot. I would check that out. I'll send you our agent in that market. We've got three of them.

SPEAKER_00 21:45

Okay, I'll be reaching out. So now when you're talking about also, you talked about um the hurricanes. That's one thing that uh bothers me as well. Yeah, so so if you get hit by a hurricane, how does that? I know you have to have insurance, but like Is there anything that's like, okay, for example, I guess if you have proper or something, uh, is there any insurance products where you get knocked out by a hurricane? Is there a way for you to keep receiving income or how does that work?

SPEAKER_03 22:13

There are insurance products that will cover lost income. Um, I think if you were in a situation like a Katrina situation where it's for months and months and months, that might not be as covered. So it just depends on what product you go with. For me, um, after you know, I grew up in Mississippi, so we weren't on the coast, but we were close enough to where if a bad hurt, like Katrina affected us. Um so I am kind of used to that, and it doesn't really bother me that much. And then now living on the coast, it's not it's not as scary as a lot of times the news makes it out to be. Like, yes, hurricane season happens every year, there's always that chance, but like we sat through a cat free sitting in this house for like three days one time, and it wasn't really any worse than like an afternoon thunderstorm in the summertime growing up in Mississippi, it just lasts longer. So a lot of times it's not as bad as it kind of seems like it is. It's just, you know, every now and then there'll be a really crazy one. So what I tell people who are worried about hurricanes is like you can invest for what happens 99% of the time, or you cannot invest based on what could happen 1% of the time. Um, yeah, my grandmother has had a house here on the water in Destin for so it was built in 1969 and it has never had hurricane damage. And then Luke and I bought a house, a duplex in Chattanooga a few years ago, and within six months, it got totally destroyed by a tornado. So the Destin house should have had it happen a thousand times before the Chattanooga house did, but that's not the way that it works. So it can happen. It's something you have to kind of think about if you want to buy a coastal property. But if it's the good news is if that's something that's gonna keep you up at night, then there's plenty of mountain markets to buy in.

SPEAKER_00 23:59

Yeah. And now, and I'm happy you brought up the mountain markets. Now, how because I know everyone was running to the smokies like

Smoky Mountains pricing: from 100% returns in 2019 to $800k entry now

SPEAKER_00 24:07

in the last two years, just running there. Go to the smokies. Is is the smokies somewhere that's still affordable, or you got to come with the influx of cash to get in.

SPEAKER_03 24:16

I would not classify the smokies as affordable. It used to be very affordable, and what caused the whole influx is it was like underpriced. So there are properties that I and like some of some of my first clients who are now agents on my team, some of my older clients, that we had like 100% cash on cash return properties that we bought in like 2019. Um, those deals are not out there anymore, but you can still get well into the 20 and 30 percent range, but you're gonna have to have like I mean, you're gonna have to have an average of like an $800,000 purchase price on the low end. What? It's like yeah, it's like $500,000 for a two-bed now. Wow. A lot of times. Yeah. So the purchase prices have gotten really, really high, but the income is also really high. But it's just a a very high purchase price. So I tell people, like, yeah, the Smokies is still a great place. It's still there's a lot of money to be made, but it's not the only one. And it used to be like there were 70, 80, 100% cash on cash return deals just laying around on the MLS for six months that nobody bought, but now it's like people have caught on. So it's still good, it's still better than an apartment building. Like I could go buy something in the Smokey's right now and still have a higher cash on cash than an apartment building that I'm buying right now, but I like to have a diverse portfolio. So um, there's lots of good markets. The Smokey's is still a great one, but you do have to have a pretty high, high budget to get into that one.

SPEAKER_00 25:47

Wow. Now, now you you also touched on apartment buildings. So, me and Steve, we've been talking about getting into apartment buildings. Um, what was your advice to getting into like the multi-family, the big multi-family? How did you get how did you get into it?

SPEAKER_03 26:00

So we got into it last year, and we're still very new to the space. So we have two 12 units and a 25 unit, and we're under contract on a package of three that from the same owner that totals to 68 units, like a 35, a 25, and a eight. Um, so we're still pretty new. And um, when you're getting into a new asset class, whether you're trying to jump into multi or you're trying to jump into short terms from something else, the most important thing, even if you're very experienced, is it really is different. You cannot, you can buy you know a thousand single family homes. You cannot roll into the multi-world and try to act like you know everything about everything because you don't, just because you own a thousand single families. So we were very humble and we kind of markets and I like for long terms, I like medium size metro markets in the southeast and the Midwest because they don't fluctuate as much. They're not gonna appreciate a ton, but they're also not gonna lose a lot of value either. So we like to stick to those kinds of a bunch of the market that we wanted to focus on. And Luke just posted he was like, Hey, I'm really experienced in this, I'm trying to get into the multi-space. Anyone have any advice for me? And some guy was like, Yeah, call me, I'll talk to you about it. And Luke was like, Okay. So he called him and we were in our motorhome going somewhere, I think maybe to my parents' house, and he just called this random guy. Turned out the guy owned like 800 units in the market that we were trying to buy in is like the biggest investor in that market, and just took the time out of his day to talk to some random guy with long hair on the internet. And um, we ended up buying one of his, he introduced us to his property management company, and uh, we ended up buying our first 12 unit from them. And uh basically, uh, you just kind of have to make sure that you're humble and say, like, hey, I'm really experienced, but not in this. So I'm gonna take your advice on this. He introduced us to his agent, and we were very clear about we are very qualified buyers, we are very serious, we are going to buy, we are not gonna be difficult to work with either, but we're gonna need a little bit of advice and we will take your advice. Um, and that has gotten us really far. Like a lot of our good deals, which we don't have that many deals, but have been off market from just being humble and like, if you send us a deal, that's a good deal, we will buy it and we will not be difficult. And we've proven that to our agent, to our lender, and to a lot of the the property management companies that know when things are coming up, like hey, send it to Luke and Avery, they'll buy it, and they're not gonna be a pain in the ass when they do it either. So um that's definitely yeah, that's the best way to do it just jump in there and network and be cool.

SPEAKER_00 28:49

Yeah, and I know Luke's a huge networker on bigger pocket. That's how I met him. That's how I met him. So I know he's always on there now. And that's cool how you guys basically Luke leverage his knowledge. Hey, I'm good at this, but not good at this, and leverage the relationship. And I tell people to do that all the time. Um, now it looks like you guys are mainly, is that your future goal is to just mainly buy multifamilies?

SPEAKER_03 29:10

Um, not necessarily. Like we're under contract on the short term right now, right down the street in Destin. So um, we kind of have our three little silo silos

Running three silos at once after mastering each asset class first

SPEAKER_03 29:20

going at all times. So if a good short term pops up, we'll pick it up. Uh, and we have a market in Alabama where we just continually pick up uh value add single families, probably two a month. It's kind of slowed down recently, but we're on an average of two to three a month all last year. And then we have our multi-machine uh in the Midwest where we're we our goal was to get 50 doors this year, but looks like we're gonna pass that Q1.

SPEAKER_00 29:46

So congratulations.

SPEAKER_03 29:48

Thank you, thank you. So we kind of have all three going just because there's value in all three. And I certainly don't want to steer any new investors down that road. Like, don't go try to buy a bunch of different things in a bunch of different places, focus on one thing first. So we were all short term for the first five deals, minus that that first one that got us into real estate investing. And then we said, All right, we want to mix some long terms in here. So then we bought, I think, four or five long terms. And then we said, Oh, you know what? Let's 1031 exchange. By the way, our two partnership deals, you can 1031 exchange your equity from a partnership into another property if your partner buys you out. So we did that. Um yeah, so focus on one thing at a time because if you try to focus on too much at once, you're never gonna buy anything. So this is something that we've set up over the course of our investing career. Like, hey, we found this niche with the short terms, uh, these long terms, you know, we wanted to sprinkle some in and we've kind of zeroed in on a market where it's repeatable. And then um, you know, everybody wants to, we kind of just got into long term, I mean into multi because we're like, well, all right, we're buying 20 of these single families and we're having to pay like $8,000 closing costs on every single one. What if we buy a 20-unit and pay one set of closing costs and see how that goes? So we just kind of graduated into that.

SPEAKER_00 31:07

Smart thinking, smart thinking. Now, in these markets, because I know a lot of people are coming to these vacation rental markets. Are you seeing any signs of saturation?

SPEAKER_03 31:16

So, in these types of markets, it's kind of different because they like 90% of the real estate that has ever

Saturation myth: these markets were 90% vacation rentals before Airbnb existed

SPEAKER_03 31:24

been traded in these markets, so pre-Airbnb, pre-internet, has been vacation rentals. So, saturation happens when there's really not any of a product in a market, and then all of a sudden the market is flooded with that product. So that's not what's happening in these markets. Everything in these markets was already a short-term rental, but now there's just more attention being paid to these markets on what was already going on for decades because short-term rental is now finally being looked at as an actual asset class and not like a thing where a bunch of kids are renting their futons to each other. So there's a lot of people who, like multifamily investors, for example, who five, six, seven, 10 years ago would not have ever messed with short term. Now they are, but it's not that those markets didn't have any short terms and now they have a ton. It's they already had basically all the real estate in them was short terms, but now they're just changing hands and that's getting more attention because people are like, oh, wait, this makes sense.

SPEAKER_00 32:22

Yeah, got you. Wow, okay. So yeah, you don't have to really worry about that because mostly everything people are coming there nonstop for that product. Okay. Um, now your book. How did you get the idea for your book? And tell us a little bit about it. Because I definitely got to get my copy.

SPEAKER_03 32:37

Yeah, yeah, I'll send you one. So um Bigger Pockets actually approached me about writing it. Uh, I've always been real active on their forums. Um a few of them have bought them, I mean admins, uh podcast hosts, etc. Have our short-term shop clients. Uh, I've spoken at their conferences a few times. So they said, and it was in 2020, actually. And they said, Hey, you know, I think the time is right for a short-term book. And we think that you would be the best person to write that. Will you write it? I'm like, yeah, of course I will. Yeah, of course I'll do it. And um I was like four months pregnant with our second child, our son, at that point. And they're like, Okay, cool, great. So here's the bad news. We need this finished, done, turned into us in six months. So I was up, yeah, I was up every morning, 4 a.m. before my daughter woke up because this was like the height of COVID. So there is no childcare, there's no school, there's nothing. And I had a an 18-month-old. So plus trying to run businesses. And so I was up at four o'clock every morning writing that book. Uh, had had my son over the course of the process of writing it and finished it uh when he was three months old and got it turned in on the on the exact day it was due.

SPEAKER_00 34:03

Wow. That that that that's hustle right there. I love that. No, now did you have a writer to help you or you just did it all yourself?

SPEAKER_03 34:11

Nope, blasted it right out on this computer, actually, and I'm talking to you on. Um, yeah, I just got up every morning, wrote 10 pages, and I said, I'm not gonna like go through and reread this until the whole thing's done, or else I'll never finish it. So I just got up and wrote every morning. I I set a goal of 10 pages a day. I did not hit that goal. I would have finished a lot faster if I had, but that was my goal that I shot for every day. So even if I only got five, you know, that was something.

SPEAKER_00 34:36

So that that's awesome. I love it. Um, yeah, where can people buy your book?

SPEAKER_03 34:41

Anywhere that books are sold. So Amazon, Barnes and Noble, Books a Million, uh, and then the Bigger Pockets website. It's a little bit cheaper if you go direct through Bigger Pockets.

SPEAKER_00 34:50

Oh, really? Okay. I'll definitely have to look into that. Okay. Um, now for your advice for someone, let's just say someone wanting to get into real estate, what would be your advice to them as far as just, hey, I want to get into it. What would you be your what would be what would be Avery's advice to them on getting started?

SPEAKER_03 35:07

So, what worked for me, you know, I'm going to give advice on what worked for me is starting with short term and then moving into other asset classes, because we would not have been able to scale from zero to 105 doors in five years if five of our first six purchases were not short terms, because they just cash flow so much heavier that you will be able to scale quicker. Like even if your goal end goal is not to own short terms, your end goal is to own apartment buildings or whatever, you can get there faster by investing in short terms early in your career because you build that cash flow up a lot faster than traditional long term. So I would say go buy a short term to start off.

SPEAKER_00 35:48

Oh, I like that. So you guys did that in five years now. Are you guys ever going to look into like arbitraging or anything of that of that nature?

SPEAKER_03 35:57

Probably not. Arbitrage could be a great way to get started and to build some cash flow so that you can go buy stuff. But at this point in our career, it just doesn't make sense. And early in a career, it makes a lot of sense to try and and get that role, get the cash flow rolling. But for us now, it just doesn't make sense. Oh, so you you would tell someone to arbitrage then if they're if you if you're not able to go buy one, I would say arbitraging is a great way to get some cash flow rolling through the door for sure and get you that experience, and then you'll know what you're doing when you are ready to buy one. But the goal should be to buy one, the goal should not be to arbitrage, the goal should be to buy.

SPEAKER_00 36:31

Yeah, and I'm happy you said that because I I run into people where they tell people don't buy property, only arbitrage. And I'm like, uh arbitrage is a means to an end. So and yeah, and then that and I get a lot of people asking me, Do I arbitrage? I'm like, I do it, but I do it for a purpose. So that that is very good advice. So, Avery, thank you for coming on. This is another episode. I'm gonna have to get I might have to see if I can get you and Luke on together.

SPEAKER_03 36:57

Oh, we'd love to. If you'd be fun old married people bickering about who's remembering stuff wrong and all that, then we're happy to do it.

SPEAKER_00 37:07

We're all married as well. We understand. Yeah, I would definitely want to get you both back on, but definitely I know you're busy. Thank you for uh giving us the time to interview you, and uh, we definitely gotta have you guys back on.

SPEAKER_03 37:18

Yeah, we'd love to do it. Thanks so much for having me.

SPEAKER_00 37:21

For sure. All right. Uh thank you. And uh I'll oh where can people find you?

SPEAKER_03 37:26

Oh, yeah, yeah. So uh follow us on all of our social media, Instagram at the short term shop. That's the one that's me. Like I am reading those messages. Uh also our YouTube channel, we have a lot of free content to teach you how to manage your short term rentals, how to buy short-term rentals. It's YouTube slash the short term shop. And uh, if you're ready to buy a house and you want to buy a house with us, you want us to be your agents, go to theshorttermshop.com and click the schedule a consultation button.

SPEAKER_00 37:53

Thank you. I'm done because they got to do that. Um, I definitely need to get into the vacation rental market, so I will be reaching out. Thank you for coming on.

SPEAKER_03 38:00

Yeah, thank you.

SPEAKER_00 38:01

All right, bye. All right, that was Avery Carl with another, another great episode. Um, man, Avery, that that is crazy. Zero to 105 doors in five years. That is crazy. Um, I'm honored to have her on, and she definitely definitely dropped some gems. Uh, the whole thing about buying, you definitely use arbitrage as a means to an end because you definitely want to start getting that equity, start getting that that net worth to grow. But yeah, thank y'all for continuing to listen. Remember, you can follow us on Instagram at Live Let Thrive, send us an email. And uh yeah, thank y'all for continuing to listen. We are out.

SPEAKER_01 38:40

Thank you for tuning in to this week's episode of Live Let Thrive. Be sure to tune in next week for all the latest in the world of Airbnb and all that entails. Bye-bye.