BiggerPockets Real Estate Podcast - 114: How to Invest in (& Have Fun with) Vacation Rentals with Scott Sutherland

Episode Date: March 19, 2015

Have you ever been on vacation and thought, it sure would be nice to own some property down here? Well, that’s the subject of today’s podcast, as we speak with vacation rental property owner Scott Sutherland about how he’s built a profitable business owning and managing his vacation rental properties. You’ll learn the step by step process for finding potential properties and analyzing them for profitability, as well as financing ideas and tips on managing the short-term renters. Whether you’re already in this real estate niche or you want to get your foot in the door, we’re confident you’ll get some new insight here. Don’t miss this exciting episode! In This Episode We Cover: How Scott got started in real estate investing His story of taking time off Thoughts on choosing between stocks and real estate The concept of control in real estate How to get into the niche of vacation rentals Strategies for properties that don’t typically cash flow What exactly a vacation rental entails The ins and outs of vacation rentals, including pros and cons How to market your rental property What you should know about tenant screening on vacation rentals And SO much more! Links from the Show: Trivia Email Brandon’s Forum Post on Vacation Rentals BiggerPockets Forums Evicting Renter from a Vacation Rental Property BiggerPocket’s The Book on Investing in Real Estate with No (and Low) Money Down HomeAway VRBO AirBNB alexa.com 99Designs Books Mentioned in this Show Rich Dad Poor Dad by Robert T. Kiyosaki The 4-Hour Workweek by Timothy Ferriss Connect with Scott Scott’s Website Scott’s BiggerPockets Profile Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast, show 114. You're listening to Bigger Pockets Radio, simplifying real estate for investors large and small. If you're here looking to learn about real estate investing, without all the hype, you're in the right place. Stay tuned and be sure to join the millions of others who have benefited from biggerpockets.com. Your home for real estate investing online. Hey, what's going on, everybody? This is Josh Dorkin. to the Bigger Pockets podcast here with the big guy, Mr. Brandon Turner. What up, Brandon?

Hey, this is the big guy. Doesn't that Vince Vaughn's name on like wedding crashers? I think that's what he always called. Owen Wilson always calls him the big guy. Anyway, whatever. It's like whatever. Anyway, all right, anyway, so how you doing? What's new? I'm good. I'm good. I'm good. Everything's good, man. How you doing? I'm good. I was thinking I could use a vacation. Oh yeah. Good for you. I couldn't you. Haven't you taken like, you know, 20 since you started working here and I've taken how many? I'm just asking. I don't know. I don't know whose fault that is. Let's get the audience to chime in. Raise your hand if you think that's Josh's fault. Oh, yeah. Do you hear the rush of hands rise?

Hey, listen, I, when this when this podcast comes out, I will be vacationing in Phoenix, Arizona. I'm going down to Arizona for three days to hang out with some my buddies, watch some baseball games. I'm still going to be working, but, you know, I'll be away. You should try and You should try not to. Again, everyone raise your hand if you think you want Josh to not work. Look at everyone is raising their hands right now. In their cars. Yeah.

Yeah, we're supportive. Anyway, well, the reason I wanted to bring up vacation is because today we are talking about vacation rentals. So, you know, see that connection? Yeah, yeah. But we're talking about the other side of it, not going. What? Not, what?

What? I don't know. I don't know. We're talking about the rental side of owning them, not going on vacation. vacation, but, you know, I grasp for, you know, connections where I can. So yeah, we are going to be talking about owning vacation rentals and kind of how to find them, how to manage them, how to build a solid business that caters to people's vacation needs. Should be fun. Indeed, indeed. All right. Well, before we, before we get into it, why don't we get to today's quick tip?

All right. All right. Do you want to do it? Today's quick tip. You got it? Who wants it? I'll take it. I'll take it. Raise your hand if you want a job. Ouch. Today's quick tip. What? Be prepared for an upcoming entirely new podcast from Bigger Pockets. That's all we're going to say about it now. But the next few weeks, we've got something exciting coming, not just the main Bigger Pockets

podcast, but we've got a new show coming. I think you guys are going to love it. With that, why don't we get to today's trivia? All right, today's trivia. Last week's show, we talked with Jay Papazon, the co-author of the millionaire real estate investor and The One Thing, one of my favorite books ever. In this discussion, we talked about how the one thing contains an analogy to a very popular game that is actually played differently than, I mean, people play it in two different ways, if that makes sense, right? So the question is, you know, what game is it? That's the trivia.

What game is it that the analogy, the one thing is based kind of upon? If you think you know, send an email to trivia at biggerpockets.com for your chance to win the digital version of the book on invest in real estate with no and low money down. The world's greatest book. Anyway, let's get to the interview. Today, we're sitting down with Scott Sutherland, a broker and investor from down in Austin, Texas. Scott's going to share a story on how he got started in real estate and how he's been able to use vacation rentals to build his portfolio. managing properties can feel like a full-on circus. You're juggling vendors, tracking payments,

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our down payment back at closing, plus interest rates as low as 3.75%. They've partnered with Bigger Pockets for over a decade, helping thousands invest smarter. If you want to do the same, visit Biggerpockets.com slash retirement to learn more. A lot of property managers think their job is answering tenant emails and coordinating repairs. That's not the job. The job of a property manager is protecting and growing your operating income and earning your trust while they do it. And that comes down to three numbers, occupancy, delinquency, and net promoter score. If those numbers slip, your income slips, and your trust slips too. And most PMs don't hold themselves to performance standards.

They focus on activity, not outcomes. Mind is different. They obsess over the metrics that actually grow your cash flow. go to mind.co slash show me to see how mine performs and get a month of management for free. Because if you're going to hire a property manager, hire one that manages your investment like an investment. With that, why don't we get to the show? All right, Scott, welcome to the show, man. It's good to have you. Yeah, thanks for having me.

Awesome, awesome. Well, today we're going to talk about a few different things. But before we get into that, maybe we can just touch on your story, kind of get a background of what you do and where you're investing, where you're from, all that good stuff. So, you know, kind of give us a background on you. Sure, yeah. So I'm a broker here in Austin, Texas. The way it all started was way back in 2008, I was I was working in the construction equipment industry and had been doing that for about 15 years in the corporate world and decided that I needed something new. And I took a year off and went on a bit of a walkabout sabbatical. And during that time, I decided that real estate made a lot of sense for me from my background and my interests and construction. And so when I came back, I started out by getting my real estate license with the idea that I would work with and help other investors to find investment property and also work into becoming an investor myself. So that's where it all began here about six or seven years ago and I haven't looked back since. Nice. Very cool. So you say, did you say either I heard you say this or I just remember it from your notes, but you took a year off to do a walkabout that we said? I did. I decided it was two,

2008 and if you remember 2008 the economy was terrible and I felt like it was just kind of selfish of me to hold on to a job I didn't like when so many other people wanted it so I took the year off and started by riding my mountain bike from Canada to Mexico over the year yeah yeah over the top of the rockies so yeah that's that was a self-supported trip took a couple months and then once I got to Mexico, I came back and then went to South America for about three months and took some time off and just tried to. I walked barefoot across the Sahara, man. I mean, whatever, you know, you're trying to want up people.

You're not going to get there. I know. I know. I know. Keep trying. It's not a competition. I decided to give my job away because I'm a philanthropist. I, you know, walk barefoot on glass across the world.

Yeah, whatever, man. You know, we don't buy it. We don't buy it. I understand. That's fair. At the end of the trip, I'd always thought that I wanted to become a financial advisor. And I had a background in finance and I thought that would be a good fit. But one of my professors in our portfolio theory class, after many, many classes of technical analysis,

one of the students asked them, said, so what do you put your money in? And he said, index funds, you can't predict this stuff. So at that point, I realized that there wasn't, in my opinion, there wasn't a lot of value to be added by picking stocks or rebalancing portfolios. And when the opportunity came up to be involved in local real estate, it seemed like the first chance to actually take control of the situation and actually gain knowledge that puts you in a position to make decisions, you know, the arbitrage, the local knowledge, the things that allow you to create wealth by being a little better than the next guy. exist in real estate where they don't exist in stock investing. Yeah. Yeah. And that's one of the biggest things that we talk about is the idea of control.

With real estate, you have far more control. Whereas on these other things, you're at the hands of other people completely. With real estate, you know, you can, you're still at the hands of other people in that, you know, you have tenants that, you know, can do things. And the market makes certain determinations. But if you go in, make right buying decisions, make improvements, make improvements. things like that, you can really affect stuff. By the way, I gave you a lot of crap about what you did, and I'm like wicked impressed and totally want to be you. I'm like jealous is all hell. So, you know,

take my giving you grief as complete nutter jealousy. Fair enough. I appreciate it. Awesome. So how did you go from where you were to become, you know, this vacation rental guy? How did that transition happen? Okay, so we started out in long-term buy-and-hold, finding homes that were beat up and needed some improvement, and we put tenants in them, and we created cash flows. And back in 2008 and 2009, it was a terrific time to do that. We were seeing levered returns of 30 plus percent, which is just fantastic. And Austin wasn't quite the super hot town that it is today, even just five or six years ago. So we were going down that path. Returns were excellent.

It was a very low risk and low, you know, passive. It's a very passive endeavor. So that's how it all began was through the kind of the creation of a long-term rental portfolio. Then as things evolved, the return started to get squeezed out as prices came up and rental rates stabilized and the construction started to catch on. So we were looking for ways to generate additional cash flows from, properties that wouldn't traditionally cash flow. So what actually happened, my wife and I had purchased a foreclosure duplex in near downtown

Austin, and we're living in it and renting the other side. And we went off for a 40th birthday party for me in Colorado with a group of friends. And on the way back from the driving home from Colorado, my wife looked at me and she said, you know, she said, I was looking at that house. We were staying in for your birthday. And I get it. I see what they're doing. It's really not that complicated.

I think we can do that when we get home. So on the way home from my birthday, we hatched a plan and two days, or sorry, two weeks later, we had the house prepped, photographed, and I was off shopping for an RV so we would have a place to live. Nice. So really quick, you talked about properties that don't traditionally cash flow. What did you mean by that exactly? Well, you know, what you'll find is that the best cash flowing properties are typically the

ones that that cost the least. There's this kind of delicate ratio where if you buy a house in a really rough part of town that's no one wants to live in, you deal with all kinds of tenant headaches and the cost of collection. You know, the time involvement when you compare it to the amount of income you're generating doesn't quite make sense. So you're trying to hit this sweet spot where, you know, it's a, it's a decent neighborhood. The rental rates are still good enough to make it worth your while. But as you move into the core of many cities like Austin or Denver or any other, those kind of hot and up-and-coming towns,

what you find is there's no longer a linear relationship between the purchase price of the home and the rental rates. The rental rates start to flatten out and as opposed, and as a result, the ROI start to drop off. So, you know, everybody, a lot of people when they first come into real estate, they say, yeah, I'd love to have a cash-full rental property. and it would be really great if it was in a cool location. And sometimes that's hard to achieve.

But with vacation rentals, you almost have to buy in an area that is cool to be because when people come to a town to visit and they choose to rent your house instead of staying at a hotel, a lot of what they're looking for is access to your city. And they want to be able to walk. They want to be close to bars and restaurants and activities and festivals and things like that. So the two marry up really well. That makes sense. This might be like, you know, a very basic question, but a lot of people might be wondering

this. What exactly are we even talking about when we're talking about vacation rentals? Because the thought that most people have in their mind, of course, is, you know, house sitting on the beach and the sand and, you know, everyone's in white walking on the sand together, you know, in their white shirt and khaki pants. I don't know. Like, that's like the dress when you go on the beach. That's like the beach, like, that's like the beach like thing, right?

Like, I have a beach town near my house. It's called Seabrook. and like that everybody wears clothes like that and walks around this beach town. Like that's like what people I think envision a lot of times as vacation rental. Is that what we're talking about here? It certainly can be. And there's a really strong vacation rental presence in all the coastal towns. But, you know, vacation rental and short-term rental, which are the same thing.

You know, those words can be used interchangeably. It's, you know, it's a competitor to a hotel. And it's essentially any place that people rent fully furnished for, short periods of time. And short could be a couple nights just coming into the weekend. It could be weekly. We do monthly rentals for a variety of situations. You know, when we first started, we were hitting the big events. You know, we knew that people would want to come here for the Formula One car race. We knew they would want to come for the music festivals. And what we didn't know is why would people come on just a random weekend? And what you learn is that,

any reason someone could stay in a hotel, they could stay in a house. And there's a lot of advantages of staying in a home over staying in a hotel. And I think that's why there's a huge growth in the vacation rental piece of it, because people are becoming more comfortable with staying in someone else's home. And they like all the benefits of having a place where they can have, you know, multiple groups of friends and multiple bedrooms and all be in the same place and have easy parking. And there's, you know, there's a litany of reasons. Sure. So, you know, I've got a piece of property I'm looking at, and it's, you know, at a great part of a city. And, you know, I can either go and rent this thing out over the long haul, you know, get a steady tenant who's going to be in there, or I can go vacation rental route. I can't even say vacation rental route and, you know, cater to that audience. Now, without knowing much about this, you know, I might say to myself, well, I got a lot. I got. You know,

to deal with, you know, somebody who's here for three days, then I got to turn it around, somebody who's here another week, turn it around, I'm probably going to have vacancies in between, then I got to do all this turnaround, the cleanup, you know, and it's kind of a headache. You know, the net, I'm assuming, is going to be considerably higher than a long-term rental. But the work that goes in seems to be a lot higher. And I think people who are looking at these things, you know, a lot of them don't necessarily they only want just a rental. They want the package that kind of comes with it. Hey, what are the cool places to eat nearby? Where do I hang out? What's the transportation like? Can you help me with this

stuff? Almost like being an innkeeper. Sure. So those seem like kind of downsides, you know, higher workload type things. Tell us a little bit about all that stuff. Sure. You know, I mean, just just like investment property, there's, you know, there's extremely passive opportunities and there's opportunities that require more work. There's people who are handymen at heart who like to buy the properties that are banged up, and there's others that like to buy a turnkey property that is as minimally involved as possible. There's no doubt that the short-term rental is more time intensive, but there's higher returns to be had from that, and there's ways to mitigate those things. You know, you can automate that process. There's some things you can do to, and it's scalable. As you get, as you get,

more properties and you can you can get your your cleaning service coordinated you can start to create a formula that works then it becomes a far more passive endeavor than it is in the beginning my advice if someone was was thinking about getting into this or they had some interest in this if they have a home that's already in a desirable area it'd be a great way to test it to just make their home a rental and and i think that kind of there's people that freak out about that a little bit. They think, well, there's going to be somebody in my house. And I can tell you, we've rented four different properties for about 200 nights a year apiece for four years. And we've never had any damage to speak of any more than just a messy house. Wow. That's awesome. That's awesome. Yeah,

yeah. You know, I know a couple people who I know more about this than I'm asking, and I'm asking the questions, because I know it's the audience wants to hear the questions. I've got friends of in New York in particular who make a lot of money, a lot of money. They went from long-term rentals to vacation rental, and they're doing exceptionally well with doing it. But, you know, a cool strategy for starters that some people I know have tried out is this. When they go on vacation, they rent out their house. So I'm going to go to, you know, Orlando with my family. Well, during that period of, you know, a week, I'll use my home as a vacation rental and I'll, you know, use one of the

sites to get it rented out and offset my cost, which is a really cool strategy. Have you ever tried that before? Sure. We do, we actually do it all the time. We did this Christmas in New York. We actually rented from someone in Chelsea, and then we rented our home back in Austin while we're gone. I mentioned before the RV piece of it. That was a personal decision. My wife and I had always talked about when we got older one day, we'd get an RV and travel around the country. And we thought, well, why not now, you know, rather than have to stay with friends or family or, you know, book a hotel or, you know, come up with a place to go, you always have a place to go. So we take paid vacations all the time. That's great. Yeah. You know, one of the reasons I wanted to have you on

the show actually is because, you know, the reason I put it out in the forums, in the Bigger Pockets forums, I just said, hey, does anybody have any experience in vacation rentals? And you reached out to me and we started having a conversation, which just as a side note is one of the coolest things about the forum. So if people are not engaging in there, I mean, the conversations like this happened, not just on the podcast, but in real life, because I want to buy a vacation rental. I mean, my wife and I went to Hawaii a few weeks back, and we talked a lot about it then. And I don't know if we'll buy it in Hawaii, but just in general, I love that concept. So, you know, I like the idea also of potentially moving somewhere.

Maybe, you know, Josh should be happy if it's Denver, you know, like moving somewhere and then renting my current house here as a vacation rental and then coming back if I wanted to and then renting the other one as a vacation rental. Just like you said when you leave town, it's almost like you're renting. You know what you should do, Brandon. We're live, but I don't care. We're going to talk about this. You own the two Nirvana houses. You own two of Kirk Cobain's houses. Sure. You should kick out your tenants and use those as vacation rentals. I've thought about it. I guarantee you if you like decorated that stuff with like, you know, Nirvana and memorabilia and stuff like that, be like, hey, come stay in Kirk Cobain's house. I bet you there's thousands and thousands and

thousands of fan boys and girls that would kill to go and stay there. You're probably right. And what I might do actually, kind of a sad story, I guess, my tenant in the back house, like it's a little one-bedroom house because there's two houses on one lot. He lived in both when he was a baby. And anyway, the lady in the back house is dying. And that's actually a whole different conversation that we're dealing with right now is, like, not to sound like, I don't want to sound like insincere or whatever.

Like, it's very sad. And she's my favorite tenant. I'm very sad about it. But from my business standpoint, I don't know what to do because she's in a, she's a, She's in a nursing home in a vegetable state now. She has no family or friends, nothing, and the house is sitting empty with no rent coming in. So it's an interesting, like, I'm not even,

I have a thing in the forum. There's a conversation right now in the forums that people are helping me work through it. But it's fascinating. Like, I've never even heard of anybody going through this issue before. Like, who do you talk to? I mean, there's no power of attorney. There's no nothing.

Do I evict a lady who's on her deathbed? I don't know. I know, and I can't do that. I won't do that. So, like, we just, month after month, you just lose rent and, I don't know. It's interesting. But anyway, yeah, I've thought of that. That's the, that's the Kirk Cobain house. So if she does pass and if we get the house back, I probably will test that out and see what we can

get and see if there's any interest on Airbnb or on a home away. But so speaking of that, let's bring it back in. Can I ask you kind of like, what are the other benefits? Do you know, do you have any other like, why own vacation rental? Is it just the money? Is that the only benefit or what else do you think? No, actually, you know, actually, obviously the money is the primary reason, but, you know, there's been a lot of advantages. We've met a lot of really cool people. You know, we become somewhat ambassadors to Austin and people look to us to be, to provide that customer service and that kind of that concierge hosting role.

So we're there to make sure that people can get here and get settled quickly and enjoy their stay and know how to get around and where to go and we make suggestions. And, you know, we try and add some touches to make their stay better. And it also, it pays off. in the form of positive reviews, which in many of the rental sites, you know, reviews drive your rankings. They obviously drive people's impression of you and they will build your business going forward. So that's been a big piece of it.

The other thing that's been nice is we'll actually reinvest the money into upgrades to the home. And there's an immediate gratification for these upgrades because if you decide that you're going to use some of this to renovate, your kitchen. You can take a photo of it the day after it's done. You can upload it to the side, and you can immediately increase your rents or increase your occupancy. That's great. That's great. We use them a lot when we go to the mountains. It's just a great path. It's way cheaper than going to a hotel, particularly when you have family in town and things like that. So it's pretty, yeah, it's very convenient. It's a great way to go. And frankly, I know I'm not alone, and I know Brandon and I always talk about this. Like if we ever

travel, we're like, oh man, you know, I wish I had a place there. Well, that's the dream, right? Like, you know, if I go to California, I'd like that vacation rental in California, New York, and I go to, you know, Hawaii and, you know, hey, what if I had a portfolio of 25 vacation rentals that I'm Airbnb and I could travel around the world and stay in my favorite cities? I mean, it's a pretty cool ideal. It is. You know, my wife and I've actually talked about potentially purchasing vacation rentals in other towns. And what we've come to is that, you know, no one, no one can run it quite the way we do. You know, if you have a property manager running a property for you, they're going to, you know, no one looks after your money the same way you look after it. So we think we do a great job of providing excellent customer service and very clean, well-organized homes at a very good rate. We think we really focus on trying to respond quickly to inquiries. And so what our plan has been, we feel like, you know, why pick the places that you want to try. travel to because those may change, why not just create a portfolio where you live and work

and in a market you understand? And then as you travel, we always book and join the community by staying in vacation rentals as we go from town to town. But up this point, we've decided that's a better strategy for us than owning in multiple locations. And financially that makes sense. I mean, if you're going to go and let's say you're going to go take a vacation to Hawaii and you have a rental there that normally you rent out for 500 bucks a night and then you go stay in it for five nights. Well, you know, you might as well just, then you don't get paid from your rental income. Right. So you might as well just pay to go stay somewhere else and not even have the vacation rental there necessarily. I mean,

you know, there's benefits probably, I'm guessing there's like tax benefits to go in there to check out your property. Maybe, I don't know. But anyway, yeah, so that's kind of another thought is, and that was actually one of my fire around questions for later was, and maybe we'll just touch it now, like should you buy it based on great locations or based on numbers? And I think, I think the numbers thing probably makes more sense. Yeah, I think they go hand in hand. And the numbers, yeah, is more important. You have to strike that balance between being in a place people want to be,

but not such a hot area that you force yourself to have to bring in, you know, huge numbers consistently in order to make money. So we tend to, just like you would in a, if you were buying a property to rent, you know, we tend to look on the fringe, you know, where is the growth, going, what is close to the hottest areas, but still affordable, because you have to strike that balance between, you know, acquisition price and rental rates. Yeah. Hey, hey, really quick, you had talked about doing rentals for more than, you know, for months

at a time. And I can't seem to think about it. I've been trying to figure it out and I can't figure it out in my head. There's some disadvantage to that. And I don't know what it is. I just can't think of it right now. Like, once you exceed 30 days. And I know there was a big story in the news a couple months back about, you know, something like that in Airbnb and some woman.

Something's happened. Do you know what I'm talking about? I know I'm like not verbalizing it. She's on BP. I was reading the story today. I think that was a California story, wasn't it? Yeah, yeah, it was a lady. I think in California, it might have been like maybe she was from California. He was in Nevada or they're both California. Yeah. And like he stayed forever and wouldn't leave and they couldn't evict him. And it was just like that's what I was. Yeah. Yeah, that's, I remember that. You know, I, I remember that. You know, I, I guess this is where we caution to understand the regulations, you know, in your respective area and state, Texas is relatively landlord-friendly. So we don't run into those kind of things much.

Now, Austin is a little bit more onerous when it comes to the local short-term rental regulations. And, you know, we also touched on New York. New York actually has a restriction against, and it may just be Manhattan, but certainly Manhattan, against renting for periods under 30 days. I think they lifted that. Did they recently? I know there was a whole, you know, anybody listening, if you want to know,

it's in the news, Google it. I seem to remember. I mean, I know because, again, I was sitting in my buddy all this stuff. I'm like, dude, be careful. They're going after everybody who's doing these short-term rentals. And then I seem to recall it being lifted.

But yeah, you need to know the local laws like you would with any kind of rental property. This is not a game. This is not something to be trifled with. right? Sure, sure. You know, the 30-day rule for us, we really like the monthlies. The disadvantage to monthly rentals is that you're receiving less per night than you would.

Typically, five nights equals a week and three weeks equals a month. So you might get, if you can fill it every weekend or every day, you're going to yield a much higher per night rate. The nice thing with the monthly is that you have 100% occupancy for that month. also in our area there's no hotel tax collected for any stay over 30 days so it's a win-win for both the tenant and the owner obviously it's a lot less time intensive as well makes sense so you're saying hotel tax that's something i didn't even realize like if you have less than 30 days you have to pay a tax what does that tax in austin tax in austin it's about 15 percent okay so it's it's a chunk i mean that's that's bigger than my maintenance budget so um what

What are their expenses do you have to take into account when you have a vacation rental? You know, the big ones, and I'll contrast it to a traditional rental that most people are familiar with. I mean, obviously you have all your, the same expenses as far as property taxes and, you know, your mortgage payment and whatever maintenance is involved. But you also have the utility piece that you don't normally have. So you have to not only provide electric water, sewer, gas, but you can't forget about television and Internet. as well. Yes, correct. Okay. And then and then the other thing you'll you'll have is you'll have some consumable expenses, which is depending on the level, we keep it pretty simple. We'll usually put a bottle of wine on the counter and we'll throw some spices in the in the kitchen. But of course,

you have to provide toilet paper and and soaps and shampoos. And you have to think of this more like a hotel and what you would expect if you were checking into a hotel. And then the final piece of is cleaning, cleaning and make-ready between. Wow. So what does that amount to? You know, we talk about the 50% rule on bigger pockets. You know, what would you say total expenses are on a vacation rental? Because you're adding in all the utilities and all this other stuff. We run about all total.

Now, I'm not talking about the, we're running about 35% of rents is what we typically run. and that doesn't include any principal paydown, but it would include things like property taxes. So that's the number that we pulled off of our tax return last year and just took a look at, you know, if you bring in $100,000, you might net out $65. Okay. Did you know you can go on vacation and actually earn money?

Because while you're out exploring new horizons, your home is sitting there, dark, silent, and wildly underemployed. And it could be making you extra cash. And Airbnb makes that possible with something called the co-host network. If you're away for a while or you live far from your place, you can hire a vetted local co-host with real hosting experience to help take care of everything. They handle guest messages. They prep your space, manage reservations,

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retirement. Wouldn't it be great if your house plants paid rent while you were out of town? I mean, they've got the whole place to themselves, lots of sunlight, zero responsibilities. But no, they just sit there waiting for someone to spray them with some cool mist like a bunch of leafy loafers. But guess what? Your home actually could be earning you money while you're not there. Airbnb has a great feature called the co-host network, which makes hosting your home so easy. If you live far from your property or are away for extended periods, you can hire a local co-host to take care of the hosting for you. These co-hosts are vetted locals who, who already have experience hosting on Airbnb.

A co-host can handle all the details like messaging guests, creating your host space, and managing reservations. So everything runs smoothly. It's a practical way to earn a little extra money, maybe even some cash toward your next trip. Plus, you get to share your place with someone traveling to your area while you're off making memories somewhere else. Your home might be worth more than you think.

Find out how much at Airbnb.com slash host. So what makes a good vacation rental? I mean, does it matter if it's a condo or a cell? single-family house. I mean, you know, is there, you know, you talked about proximity to festivals and things like that, you know, would proximity to a train and a house in the suburbs, would that make for a good vacation rental or does it have to be really close to downtown, walkable to downtown? Talk about that. Okay. I think you do want to be, I mean, the reason that most of the hotels are located downtown is that's where most people want to stay. You can be on the

fringe a little bit, but you still need to have, especially if you have a lot of traffic, you need to be in a place where people can get to and from the types of activities they want to attend. If you have things like lakes or oceans, then that's a totally separate market. Obviously, if you're on the beach, that's great. And if you're on the lake, that's great for as long as the lake is, you know, it's warm. So you have to consider that. We haven't done any lake rentals we focus on the core because it's a year-round business in Austin. If you focus on areas where it's a really seasonal trend, then you won't realize the revenues during those off periods.

And that's something we should talk about is that a lot of areas are seasonal. They don't stay rented all year long. So somebody might think, oh, I'm going to buy this vacation rental up here on the beach in New York. And then, is there a beach in New York? I don't even know. I'm assuming. Are you really asking?

I mean, is there like beach town? Is it on the coast? Is it on the coast? Yes, it's on the coast. Are there like beach towns? I mean, really? How the hell are you my co-host? What kind of crap question is that?

That's ridiculous. Is there a beach? Beach is not the same as ocean. Is there snow in Canada? Listen, beach is not the same in ocean. There is no beach south of me for quite hundreds of miles. There is ocean. There's no beach, right?

You don't go and stay there because it's just woods. Can you ask a real question, please? Yeah, the question is, I mean, that's not even a question. That's a comment, right? The comment is, people should be aware that the fact that there's winter, there is seasons, there's times that things are more busy. I love that you said about the course. Let's ask a question.

All right. So the question is, you know, I'm going to move on since you're being so meeting, Josh. All right. The question I actually have next here is how do you market a vacation rental? I'm shifting gears quickly here. We're going down. Well done. Well played.

How do you market a vacation rental? We market exclusively through Home Away. VRBO and Airbnb. Homeaway, VRBO.com and Homeaway. And Airbnb. And Airbnb's, Homeway and VRBO are actually the same company now. Airbnb is separate and is a little stronger on the West Coast. I would guess that 90% of all vacation rental traffic in the U.S.

goes through one of those three sites. And they're excellent for bringing in visitors. And they also have really good tools. for credit card processing and tracking and taxis and we really really have liked it. So what about the costs for posting on these places? And then is there, you know, you said one's better on the West Coast potentially. Are there advantages to say putting it on one or, I mean, do you just go ahead and blanket all three of them?

So the Home Away side is a pay per, it's an annual subscription. Okay. So you pay one time, it can range from $400 per property to $1,200 for property, depending on the package you choose. And Airbnb is a per booking. They just take a slice. So if I were getting started, I would start with Airbnb. So I didn't have to pony up $1,000 and then decide that it wasn't for me. But once you start to do it in earnest full time, I would be on all three of those sites. What about VRBO? What's the cost structure there? Oh, once you're on Homeway, it's an adder. It's just a a a la carte for another $300 a year or something like that. And in terms of traffic, I mean, do you know which has the most? I think you have to see what happens in your local market. If you're on the West Coast, I think you could probably get by with just Airbnb and stay pretty booked. we see a lot of Home Away and VRBO until we start having West Coast

attended events in Austin and then we see a big spike in our Airbnb bookings. I'm actually looking as we talk. So it looks like if I'm using the website Alexa to kind of get some numbers, it looks like Airbnb followed by VRBO followed by Home Away in terms of like traffic. But those numbers aren't totally accurate.

Yeah, it depends on where you're at, obviously. Cool. All right. So let's say you got your listing on there. You put it on there and they submit a, you know, whatever an email or whatever their communication method is through that. How do you screen them? How do you pick a good tenant? Like, you know, tenant screening with rentals is one thing and that I'm very, you know, I harp on all the time. But how do you do that with a vacation rental? Sure, sure. We use a mix of phone conversations and social media to get a feel for why they're coming to. Austin and what their plans are. And if we think they're going, you know, if they're a rock band and we think they're going to have 20 people in a house that's set up for six, then we might decide that maybe that's not a good fit. But in, and we, and we took a lot of deposits in our first year. We were taking, you know, 300 to $1,000 per stay and holding on to it and forwarding it

back and after so many times just returning, we didn't keep a single deposit for the first two years, we actually just stopped. We just figured, you know what, eventually something's going to happen. We have an insurance policy and, you know, for the home, we have a journal liability policy that covers kind of everything, just a journal umbrella. And we just had really good luck with it. So if it does happen, it'll average out. So I've got two questions that come to mind. One, do you inventory everything in the property? So do you have photographs and, you know, kind of itemized inventory? And is that something that you have the turnover people kind of look for each time? Sure. When we first prepare a house, we get it set up and we have professional

photography coming or have it done, which I highly recommend if you're, if you're going to do this right, pay the $150, have a professional photographer come out, get the lighting right, really shine the place up because it drives a, it's a huge driver of your traffic. At the same time, when we do that, we'll go ahead and bring our cleaning and prep people through and explain to them how everything's supposed to look. Here's where the spices go. Here's how the towels are wrapped. We try and be really consistent with that, with that outcome. Now, as far as inventory, there's not a lot in the house of value per se. I don't worry about people running off of the couch. Yeah. The, you know, there's a TV or two, but LCD TVs aren't terribly expensive. And the other nice thing about these

sites, as opposed to say, trying to just doing like a Craigslist ad is people have profiles. People have to sign up. If someone were to do something malicious, then they would likely be found out. There would be a way to track that. So everyone's pretty been much been on their best behavior. That's great. That's great. My other question, you had talked about, we talked about tenant screening versus screening, renter screening. You know, what about the concept of the discrimination, right? I mean, is there, you know, I don't want a guy, you know, with tattoos on his face necessarily renting out my house.

I don't, you know, do the same things kind of come into mind with the vacation rentals? Sure, absolutely. Okay. Yeah, I mean, you have to consider anyone who's a protected. class and obviously you can't discriminate on anyone based upon, you know, age, sex, race. Right. Tattoo on the face, you can, though. Right.

But tattoos are not a protected class, nor, you know, you can discriminate against pets. They're not a protected class. So that being said, we're very pet friendly and we think that's one of the reasons people choose to stay at a house. So as opposed to a hotel because people who travel with pets constantly have issues. Yeah. Oh, yeah. Makes sense.

Yeah. It makes sense. Cool. So let's talk about. the actual operations of the rental. Is there some kind of lease? I mean, I'm assuming no, it's just through the rental site. How do they get the keys? What does the kind of move in and move out situation? Sure. There is a rental agreement that you can write, draft up your own rental agreement and add it to the documentation with the site so that when they accept the rental,

they also accept the rental agreement. So if you have any house rules, you can tie those in. We also create a manual for each property. And the manual is, you know, don't smoke in the house. Here's the internet password. It's a mix of rules and also helpful, helpful tips for people to enjoy their stay. As far as the, what was, I'm sorry, what was the other question? Just the move in, move out process and getting the key. How do they get their, the key? What we do is once a booking comes in, we send a email to them just telling him, thank you for staying with us. And that we'll We'll get back to them within the week before their stay with the details. We usually don't go blasting out the property address.

If it's three or four months out, we figured that's really not relevant this time. They know roughly where the property is. They've seen the photos. And then the week before, we'll send them the details on, here's what the property is. And we put key boxes on the doors and we rotate the codes on those key boxes as people check in and out. And then we also have re-keyable door locks. and we periodically, especially, you know, either every so often or certainly after big events where we feel like there's a good chance that a key was taken, then we'll just go ahead and do rekey and rotate just to make it a little more secure. That's a great idea.

Great idea. Something I would never have thought of, by the way. Yeah, that's cool. And I know they have new things. Have you used any of like the new like Deadbolt that have like the smartphone connection and you can like change the code right there for people? I've tried that. We play with them a little bit. Obviously, they're a little expensive.

And the other problem with them is a lot of times the mechanisms are a little weak. So if your door is not perfectly aligned, then it tends to jam. Our biggest fear, and the reason we didn't go that route is we had this fear that we'd be in another state, and we'd have everything set up and ready to go, and they'd have the code and the battery would die. Yep, yep. You know, so. That's true. But the other thing we do that I'll throw in his little recommendation is we kind of,

a mix of, we do have the thermostats. We started with the Nest and now we're moving over to Honeywell just because we can run more thermostats without, on a single account, Nest has a silly little limitation of four thermostats and two addresses on per account. So you, oh, interesting. You have to log in and out every time and set of multiple accounts and if you're using it via your smartphone, it's kind of a hassle, but you can do 30 with Honeywell. So it's really nice because if someone checks out and we're not going to be around for three or four days, we don't have to worry that they either left the AC on freezing cold or the heat on really high. And the ability to just quickly pull up your phone and dial the thermostat can be a big money saver.

Yeah, I love that. Yeah. Hey, Scott, how do you alleviate the fears of people who, you know, are maybe inexperienced at doing the vacation rentals from the renter side? And, you know, I'll take, for example, I know the first time that I was going to go and do it. I was going across country and all of a sudden hey, you know, I'm

going to fly, I'm going to get the rental car, I'm going to show up and I'm not going to be able to get a key from this guy. What if this guy is kind of bamboozling me? You know you go to a hotel, you know, it's the hotel chain's reputation. Obviously they try to build that into these websites but, you know, is there anything

more than just kind of building up a really solid reputation to get past that? Because I know that other people probably face the same thing. So you're speaking from a renter side, right, George, Josh? Yeah, yeah, yeah. George is fine, too. You could call me there.

George is fine. Good. Yeah. Yeah, I think your ranking and your presence online is really a big deal. We're very reachable as well. You can call us and talk to us. It would be a pretty complicated endeavor to craft a profile on one of these sites with 28 reviews all for the purpose of taking a couple thousand dollars from somebody.

I mean, it's in the same. same way that with eBay, you buy something and you look at their stars and you assume that when you pay them, they're going to mail it to you. So I think that's what the trust is created. Gotcha. Right on, right on. Cool. Cool. What about when they move out, you got the cleaning crew to come in, right? You don't do the cleaning yourself, correct? That's correct. So how do you find somebody to do the cleaning? Who do you use and how should people go about that? Oh, we found someone who was just a referral who was doing cleaning work for another vacation rental owner. And we went ahead and that our properties their portfolio. We just knew that they were reliable and that they had a

vacation rental mindset. My wife does most of day-to-day operations and she fortunately is somewhat OCD, so it's a really good fit for the vacation rental business. So the houses, and this is the difference between, you know, just cleaning your own house or just cleaning a house or even making, doing a make ready on a long-term rental. When people show up, they expected to be hotel clean. So, and everything needs to be in its place and, uh, it needs to feel like that experience. So it's, it's fine to have, you know, you want to depersonalize the house a little bit. You know, you want it to feel a little bit more like a hotel. Uh, I recommend that if, you know, if you have a closet, you can throw a deadbolt on and, and move all your personal stuff in there.

That's great. Um, another thing that we do is, is, uh, all the houses we have, uh, all white sheets and linens separate. So when we, if it's a house we were living in, we would strip all the linens off and throw them into storage and then we'd bring out all the sheets that were for the rentals. And the nice thing about using all white is you can, you can bleach them every time and make sure everything's, you know, as clean as possible. Do you carry a blue light when you ran out your house? I mean, that would be another fear of mine. I'm a germified, man. You don't use the same sheets. That's why. There's more than just sheets, man.

People are nasty. There are some dogs out there. So, you know. Kitchen table. I don't know. Yeah, yeah, yeah. Moving on. Let me ask you this, Scott.

How much does it usually cost to transition? Like, in between, like, what does that cleaner cost you to go in and get a unit rent-ready again? I'd say about $100. I mean, $80 for a two-bedroom and $100 to $125 for a three- or four-bedroom. And do you charge a tenant, like the person that stays there? I know when I've stayed in Airbnb, they charge me like $100 cleaning fee or something. That's correct. Yeah, everyone's charged for the cleaning fee and then the taxes.

If we're collecting and we charge them, if they're staying longer than a month or not. So those would be the only two line items other than the actual rental stay. Okay. Okay. Cool. We're almost moving on here, but kind of my last kind of wrap-up question maybe is, I mean, do you have any other final tips for people looking to get started with vacation rentals? I mean, anything you got written down that you wanted to make sure you covered in this show?

about vacation rentals? One of the thing I would say when it comes to time to acquire a vacation rental, if it's not someplace you already live and you're thinking of getting in this business, is I would always consider a plan B. In other words, we try and buy properties that can rent long term for enough to cover the payment, or we look at properties that could potentially be used as a flip or some other exit strategy. the issue I have with and the risk involved with vacation rentals in a town that has regulations or even one who doesn't is it's a regulated environment.

So there's always a chance that in like a New York situation or an Austin situation that the winds of change blow and someone says, you know what, that's just not what we want here anymore. And in that case, it's always a good idea to buy it with the idea of, okay, well, if that happens, then I'll just go do this. Yeah, that's a great idea. Really good advice. I especially like the idea that you said about, you know, potentially uses a flip.

I mean, so kind of like formulating in my head right now a plan how I want my life to go. Here you guys, you heard it here first. Here's all my life to go. I'm going to buy like crappy looking houses that are in good locations, right? I'm going to fix them up. Then I'm going to turn them into a vacation rental. Now they've got built an equity into them. I also bought them with the intent that they will cash flow if I had to rent it long term.

and then bought it in a good area in a good market, therefore you get appreciation as well. So now you're taking advantage of like five different types of investment right there, right? What are your thoughts on that? Yeah, the big thing there and the great opportunity you have with a vacation rental is you don't have leases that stop you from selling it to an owner-occupant. It's always ready to sell. And not only is it always ready to sell, it always looks great.

Yeah. Because you're in there every week. You're touching things up. You're making it look beautiful. You have professional photos. And not only can you, if the market suddenly feels like now is the time or you're in a situation where you think, you know what, I really need this to be sold or I need the money, you can pull that trigger on a moment's notice. And you can rent the property up into the day of closing. Yep.

Yeah. I love it. That's great. Yeah. I definitely hope to get into vacation rentals. I mean, that's why I wanted to get you on the show because I use this as my own personal. I don't know. This is my pathetic.

This is my co-host. This is how he takes advantage of his position of power. Wow, you are a horrible person. That is how I rule. All right. Moving on to the world famous fire round sponsored by 99 Designs. 99designs is the world's largest graphic design marketplace that makes it easy to get a design like a company logo,

a website, a t-shirt that you'll love and you'll get your brand out to your community. So just go to the website. Tell them about the design. want, pick a price package. You'll get multiple designers to compete for your business, and best of all, you get to pick the best design. So visit 99designs.com slash bigger pockets and get a $99 upgrade of services for free. So again, check it out at 99designs.com slash bigger pockets. Good stuff. Right on, right on. And big thanks to 99 designs. We're big fans of theirs. Yes, we are. All right. Awesome. And now, the fire round. It's time for the fire round.

fire around. These questions come straight from the bigger pockets forums, which I know you're active on. So let's see. Number one, do you know where a person can find the data on local markets related to vacation rentals, such as rents or a number of units in an area, vacancy rates? How does somebody do that research? You really have to do it through the big three sites. Honestly, I would look to see who in the neighborhood that you live in is renting, what they're renting for. and I would pull up their calendars and see how full those calendars are. And that'll give you a feel for what the nightly rental rates look like. And you can extrapolate that and do a one-year plan just by estimating what your occupancy will be. I love it. Great idea.

Yeah, that's really awesome. Cool. What number of weeks do you rent your vacation rental out for? What kind of vacancy rate are you finding? So across the board, you know, what's your average? Let's say on a typical month, how many days do you have your units filled? We have some seasonality here, but over the course of a year, we're between 200 and 250 nights. How does that fare compare to a typical hotel?

Lower. That is lower than a typical hotel. I believe it is. I mean, it depends on your market. We see hotel occupancies in the 80s in Austin. So I think it just depends on what hotel and what city. Gotcha. Great.

All right, next question. Is it possible to get started investing in vacation rentals? in the under 100K price range. Like if you want to buy, you don't have a lot of money to get started, you want to buy $100,000 property. Is it possible to get started in your niche? It would be,

I don't know how to do it in Austin, but Austin's a little more expensive than many towns. I think it would depend on the city. I think you could also look into maybe a one-bedroom condo. Condos are really, can be inexpensive to acquire and located in the core of town. The one caveat there, once again is before you get too far down the road on the purchase,

be sure and check the condo rules and regulations regarding short-term rental. Yeah. I stayed in a short-term rental one time. That was a condo. And there was like this weird, like, don't tell the neighbors that you're renting here. You know, you're just a friend staying here. Like, it was really, like, weird because they clearly weren't supposed to have vacation rentals there.

And we didn't know that until we got there. But nice. Yeah. Awesome. All right. My last question is, you know, we kind of covered this already, but where should I look for a vacation rental? What would you say, you know, if you're somebody generically saying, hey, you know what,

I want to get into the space, what would I do? I would go ahead and search to see what exists in your city. I would throw it on a map and see where the density occurs. And then I would overlay that with sale prices and try and find that point at which you're still in the circle of vacation rental properties, but where the price is starting to decline is from a dollars per square put. That makes sense. Yeah, that makes sense. Great. All right, moving on to the world famous. Famous Four. All right, the famous four, I'm going to throw these at you. Number one, what is your favorite real estate book? Rich Dad. Rich Dad, Portad. Good choice. There you go.

All right. Business book. Four hour work week. Nice. Right. Good choice. Let me ask you this question. We're supposed to expand on this. I'm not even going to expand upon it. He picked two of the books that have been picked off 48 times by other people. It's a good thing I did. You're not the guest. Give me another book. Give me another book you like besides those.

I'm hostile today. Boy, I'm sorry. Scott, it's Brandon's fault. I was the one dealing with customer service trying to get my cable upgraded. Man, what a pain. Anyway, that's a different story. You did mention it on the show. I didn't say their name, all right?

I had cable and their name rhymes with. I'm cross. All right, Scott. Okay. What about those two books stood out to you? Honestly, both those books just, I read them at a time where I was transitioning into the business. And I think that they just became kind of a jumping off point for everything else I read. You know, you go out, you talk to people and you ask them, where should I start?

And the four-hour work, we just, that was really the first. that was the very first one before I even got into real estate and someone handed it to me. And I started reading it and just opened my eyes to the fact that there's another way to kind of take control. And I think it made me value my time more and be much more strategic about, you know, my, as I say, ROT, my return on time as well as ROI, you know, on my investments. That's great. Love it. You described it the same way that I describe both those books. I say that all the time is that they hit, like, they hit me at just the right point where I was, like, moving that direction. And like, I didn't have words to define what I was feeling and thinking. And when I read that, all of a sudden, you know, it occurred, you know, I don't know, it put words to what I was feeling inside. So I love it for those reasons. I both. Agreed. All right. Good, good choices. Yeah. Yeah. Yeah. You know, you know. All right. What sets apart successful? That's your question. Why am I even reading this? I don't know. Hobbies. I don't know why I even have to refer to notes. I don't know why you look at your. No, it's either. You've done this a couple times. A few times.

Scott, hobbies, what do you do for fun, my friend? For fun, I... Besides, mountain bike across the Ruggies, we get it. You know, I don't have to go back to that. That's pretty much it. We load up the running shoes and the mountain bikes and the road bikes and the RV, and we'll take them out for the weekend, and we'll do some riding. And usually in the summer, when it gets really hot here in Austin, we'll try and get all the vacation rentals on. longer term bookings and then head on up closer where you guys live. Nice.

Oh, that's great. Cool, man. Sounds great. All right. My last question then for the day. Scott, what do you believe sets apart successful real estate investors from those who give up, fail, or never get started? Obviously, persistence is a big part of it, but also I think that persistence and patience,

if I can put those both two together. I mean, when we first started thinking about doing this, we looked at. at 20 or 30 different properties over three or four months, and it was just driving us crazy to not buy anything. But when we finally realized what it was we were looking for and we found it, we were able to move quickly to make that move. You know, the other thing I would say is that we started in long-term rentals because we felt like it was safe and we understood it.

And it was a great place to start. So, you know, my personal philosophy is, you know, do what you know and stretch yourself a little bit. And once you get that figured out, then go ahead and throw something new into the challenge so that you can keep growing, but growing progressively. If you stretch yourself too far in the very beginning, you risk setting yourself back financially quite a bit. So I would say get out there, write some offers, but before you write the offers, really learn your market and pick a segment that you want to become really educated on. Great advice. Great advice. Yeah, fantastic. Scott, Thank you so much for being on the show.

Where can people find out more about you? They can find me at www. www. Realtysteak.com, R-E-A-L-T-Y-S-T-A-K-E.com. And you're also active on BiggerPockets, so they can... Of course. Of course. On the Bigger Pockets.

Please connect you. Wonderful. Wonderful. This is Show 114 of the Bigger Pockets podcast. And anybody listening could check out the show notes at Bigger Pockets.com slash show 114. Scott, thanks for being on the show. We really appreciate it.

learn lots of stuff and good luck to you going forward with your rentals. If you've got anything really cool, by the way, by Disney maybe, or, you know, just let me know, hit me up if you want to kind of help her brother out. I'm down. Now look at who's using the podcast. I never, I never do it. Yeah, yeah, whatever. All right.

We're getting out of here. Scott, thank you so much. Thanks, Scott. Thanks, guys. All right, guys, that was Scott Sutherland. big thanks to Scott for coming on the show. Lots of cool information about vacation rentals. Man, I need to go on vacation and pick up some vacation rentals.

You do. I need to go on vacation and pick up some vacation rentals. Let's do it. Where are we going? Where are you buying? I would choose Orlando for a shot. That's my first pick. You're going to fly me to Orlando.

You guys heard it live on the show. Brandon is taking Josh, his wife and three kids down to Orlando. Not only that, but he's paying for our passes to Disneyland. I'm a nice guy. I'm a nice guy. Unbelievable. I'm a nice guy. How do I find guys?

It's like you to work for me, man. It's amazing. I do not know. I do not know. Thank you so much. Thank you. I'm honored, man. I'm going to cry.

I'm going to cry. It's so sweet. Raise your hand if you think Josh. Just kidding. All right. Moving on. Moving on. Let's get out of here.

Wrap this thing up. All right, guys. Thanks for being a part of bigger pockets. Thank you for listening to the podcast. We really appreciate your listenership. If you love us or if you hate us. You know what? Only do this if you love us.

but listen, we'd love your reviews. We'd love your ratings. On iTunes, it helps spread the word. So go to iTunes, look for the Bigger Pockets podcast and leave some feedback. Again, that's really helpful for spreading the word about what we're doing here on Bigger Pockets and on the Bigger Pockets podcast. Otherwise, if you do not yet have an account on BiggerPockets.com, get out there, set one up, make it happen, join the site, engage, connect, link up with people, and build your business. that's it. That's what I got for you. Thanks so much. Hopefully I'll have a vacation one of these days. A real one. Come on, Brandon. Orlando, I'm holding you to it. All right. All right. We're going. All right, listeners, raise your hand if you think this was the worst outro ever. I don't hear any hands.

Yeah, I don't either. Thank goodness. Oh, all right. All right, guys. I'm Josh Dorkin. Signing off. You're listening to Bigger Pockets Radio. Simplifying real estate for investors large and small. If you're here looking to learn about real estate investing, without all the hype, you're in the right place. Be sure to join the millions of others who have benefited from biggerpockets.com. Your home for real estate investing online. Do you ever notice how every passive investment somehow turns into a very active lifestyle, active spreadsheets, active phone calls, active stress? Here's a better question.

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