How to Start a Short-Term Rental Business That Beats the Competition

  • Erica Beers and Rebecca Slivka began out focusing on LA enterprise vacationers who wanted locations to keep.
  • Five years later, their properties are a haven for vacationers who can work remotely. 
  • The pair shared 5 ideas, together with circuit-breaker containers and the way to get five-star evaluations.
  • See extra tales on Insider’s enterprise web page.

When Erica Beers and Rebecca Slivka created their short-term rental startup Pillow and Coffee in 2015, they focused enterprise vacationers who wanted a place to keep in Los Angeles. 

Five years later, their properties grew to become a haven for purchasers wanting to journey safely and work from new settings throughout the pandemic. 

“People just want to get out of their homes,” mentioned Beers, noting that Pillow and Coffee properties are rented by means of platforms like Airbnb, Vrbo, and “People feel safer in short-term rentals than they do in hotels.” 

Airbnb’s latest earnings report echoes Beer’s observations: The firm’s income elevated 5% in the first quarter, reaching $886.9 million, as the tempo of vaccinations prompted extra folks to journey. 

In 2020, Beers and Slivka pulled again a bit from the day-to-day of administration of rental area. Today, they handle property for eight homeowners and run a motel referred to as Hicksville Pines Bud and Breakfast and Hicksville Trailer Palace, a venue in Joshua Tree, California, that homes trailers and facilities like a pool, shuffleboard, and an archery vary.

In 2019, when the duo was nonetheless centered on short-term leases, they booked $three.eight million in income, almost $800,000 greater than the earlier 12 months, in accordance to paperwork seen by Insider. 

Identify your goal buyer to tailor the expertise

Beers and Slivka recommend entrepreneurs begin by figuring out the clientele they need to serve. When they settled on enterprise vacationers, they mentioned the market wasn’t overcrowded but, which allowed them to carve a place in the business. 

“That is what gave us the ability to focus on a niche in our marketplace,” Slivka mentioned. “Our properties mimic the audience we’re trying to serve.” 

Identifying your buyer base will dictate the forms of properties you buy, the place these houses are positioned, and what facilities you need to supply, amongst different issues, the duo mentioned. 

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One of Pillow and Coffee’s properties, which serves enterprise vacationers.

Courtesy of Pillow and Coffee

Location, location, location 

Beers and Slivka knew their prospects did not want extreme area, in contrast to households on the lookout for trip houses, so that they sought studios and one-bedroom houses in stylish LA neighborhoods. Pillow and Coffee has properties in Hollywood, Silver Lake, West Hollywood, and downtown LA. 

They knew potential renters would need to be shut to the metropolis for a simple commute, sight-seeing, and leisure like eating places and nightlife. 

“We wanted people to be able to park their car and walk to coffee or breakfast and feel comfortable in the city,” Beers mentioned. 

Cater facilities to your clientele 

Once you agree in your excellent buyer, ensure that your potential properties have the necessities these folks will want and need, Slivka mentioned. 

For occasion, when the pair shopped for rental houses, they’d at all times verify the circuit-breaker containers, which is the place energy is distributed all through the residence. Many older houses in LA have solely two breakers, which supplies sufficient energy to run about two main home equipment, the pair mentioned. Since most renters need the fridge, air conditioner, and microwave to work concurrently, these properties weren’t appropriate for Pillow and Coffee’s enterprise. 

Then, embody the mandatory residing facilities for enterprise vacationers, reminiscent of desks, high-speed web, residing areas, and, in fact, a snug place to sleep. 

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Whatever you do, do not take photos of your leases along with your iPhone.

Courtesy of Pillow and Coffee

Don’t shoot photos in your iPhone

The subsequent important step in constructing your short-term rental enterprise is taking nice photographs, Beers and Slivka mentioned. 

“The two things that are going to sell your unit the most are location and the way your photos look,” Beers mentioned. “It cannot be one thing you took in your cellphone. It’s not going to promote in addition to skilled photos will. 

They recommend hiring a photographer who will seize each angle of the property. That manner the visitors aren’t stunned once they present up. 

“You actually need any person to have the opportunity to see and perceive the area,” Beers said. “Nobody desires a shock once they e book a short-term rental.” 

How to get five-star evaluations with out asking for them

Business homeowners ought to attempt to make their prospects’ expertise really feel as particular and private as doable, Slivka mentioned. Instead of simply recommending eating places in the space, ask the renter what kind of delicacies they like and recommend eateries primarily based on their enter. 

“Even point out a favourite dish of yours at that place,” Slivka said. “Offer one thing a little bit extra private when you possibly can, as a result of I really feel like that goes a great distance.” 

Additionally, make it a follow to frequently verify in along with your visitors. Beers and Slivka depend on automated messaging to guarantee they’re reaching renters all through their keep, beginning with their arrival. That manner, if there’s something mistaken with the place, they’ve created a chance for somebody to communicate up. 

“If they’ve arrived and there’s a downside, you are going to discover out proper then,” Beers said. “Or if they’ve a query, you’ve got already opened the door for them to ask.” 

The objective of routine messaging is to present a optimistic expertise and decrease the probability that a visitor will not point out a downside till they overview their keep. 

Lastly, keep away from asking visitors for a five-star overview, nevertheless tempting it might be. 

“You by no means ask for a five-star overview, that simply would not sit nicely with most individuals,” Slivka said. “If they did not have a five-star expertise, why would they provide you a five-star overview?” 


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