Welcome to this episode of Living In Tucson, your Tucson real estate connection. In this episode, I’m going to be doing a case study on an Airbnb short-term rental versus a long-term rental here in Tucson, Arizona.

We just purchased a town home and I’ve owned a lot of rentals over the years and always long-term rentals with longer term leases. And I’ve got quite a few friends that are doing short-term Airbnb plus I’ve worked with clients that have bought properties to do short-term Airbnb rentals, and I’ve always been in intrigued by it and fascinated by the numbers. And so we actually picked up a town home and we’re going to do a full remodel on it so we’re going to do it before and after, and then also what I’m going to do is do a case study and analyze the numbers and compare the numbers what they would be if it was a long-term rental signing a lease, getting rents, not paying utilities and letting the renters do all those types of things versus a short-term rental where we put it on Airbnb, we’re going to manage it and I’m going to compare the gross income and the net income side-by-side to see whether or not the management and the extra time in doing the short-term rental is worth the added income, which I think it will be.

We’re kind of excited about it, but now I’m going to walk you through just to kind of give you an update of we’re in the process of doing the demo on it, and we’re going to do a full remodel so I’m also going to… We get it done, I’m going to do the before and after, and just the whole process of getting it set up and all the things that we do and the lessons that we learn along the way. I’ve done a lot of research and starting to educate myself so just again, it’s going to be a learning process, but we’re kind of excited about it. But my thought is I think we can grow some extra 30 to $40,000 per year with the short-term Airbnb versus a long-term rental so I’m going to see if what I think in terms of what I put together on a spreadsheet in terms of the numbers, whether it’s true or not.

But the big thing that I’m really curious about is whether or not during the summer months everybody’s telling me that I thought the vacancy rate would be a lot higher, but during the summer months, everybody’s telling me that we’ll probably be occupied for at least 50% of the month or more. We might have to reduce our daily rate a little bit, but that’s what I’m most interested in just to see how we do in the summertime. I know what we’re going to do in the wintertime. We’ll be booked probably October through April, first part of May, and then we’ll see how it drops off and what the summer brings.

fI’ll give you a little tour of it. It’s a town home. It’s a three-bedroom, two bath, this right here when you walk in, it’s got a closet so it could be a third bedroom. I think we’re going to turn this into like the office study, maybe we’re going to take these bookcases down, give it a little bit more space and then maybe put a rollout bed in it, turn it into a three-bedroom for the Airbnb.

And then the kitchen here. Again, we’re going to tear everything up and do a full remodel of the property. So yesterday we were demoing out the floors, and again, it’s going to have total upgrade with all new everything. This is the family room. This is where the kitchen table will go.

Hall. We’ve got the laundry so washer dryer. This is bedroom number two, closet, nice size bedroom. And then it’s got a huge, huge, oh, here’s the kind of the Jack-and-Jill bath going into the other bedroom/office. And here’s the master bedroom. It’s got a nice big master bedroom. It’s got a walk-in closet and then the master bath.

We’re going to do a full remodel. We’re going to do a really nice job. So the key is getting it to pop online and so doing a really good remodel of it and having really good photos is key. And then it’s got a nice backyard here. We’re going to clean up and make it really nice. So that’s a tour of it. So that’s a little tour of it.

Again, we’re in the process of a complete remodel. It’s probably going to take us probably a little over 30 days. We’re not going to cut corners. We’re going to do it really nice and again, one of the key components to having a successful Airbnb is having really good photos online. And that’s no different than when you’re selling a house. So we’re going to do a really good job. We’re going to make this thing pop. And I think at the end of the day, we’re going to be able to get between 175 to maybe 200 bucks a night. That’s what we’re shooting for.

This is going to be a case study. We’re going to show you the before and after what we did, things that we learned along the way, and then we’re going to show you the actual numbers and it’s more or less for investors. I’ve got a lot of investors that call me that are considering Airbnb, and although I’m a seasoned investor, we’ve got a lot of rental properties, we’ve never done an Airbnb, so I’m going to do an Airbnb so I have more knowledge.

And again, we’re really excited about it, because I think at the end of the day, we’re going to be able to net an extra 30, $40,000 per year by doing it this way. But one of the key things too is you need to check with the HOA and the various communities when you’re looking at properties and you want to do an Airbnb. There’s a lot of places that don’t allow them. They allow rentals, long-term rentals, but they don’t allow short-term rentals so that’s one of the key things so you’re not wasting your time when you’re out looking at properties, because I’ve got a lot of clients that get excited about something and even write an offer and get it under contract, to learn down the road that they don’t allow short-term rentals. So it’s really important to do that homework up front. And again, we are going to do a case study and really excited about it. And we’ll be showing you what we’re doing along the way.

Back at my office and wrapping up this video on short-term rental versus a long-term rental. We’re going to do a complete case study. It’s probably going to take about a year to complete because we’ve got to get through the summer and then the winter in terms of the numbers, to be able to compare the summer versus the winter. But we’re going to show you the remodel, the furnishings that we do. We’re going to talk about the systems that we put in place to help manage it. The things that we learn, the things that we should have done differently, but again, I’ve got a lot of rentals and I’ve never done a short-term rental and I’ve always been intrigued by the numbers.

And so I’m going to, based on what people are telling me, I’m going to see whether it’s true or not. So follow our journey. And again, we’re going to be posting these videos on our YouTube channel. I’ll have a section for it so you can easily find them. We’ll put them in order so you can follow the process. And I know there’s a lot of people out there that are considering short-term rentals versus long-term rentals.

So again, this is going to be a case study. We’re going to have fun with it. We’re really excited about it. And we’re going to take you through the entire process.