Site icon Easy Prey Podcast

Short Term Rental Scams with J. Massey

Easy Prey

“The number one concern of people is safety and security.” - J. Massey Share on X

Many of us love traveling, but safety and security are usually a concern in the back of our minds especially if we are traveling with our family.  So how do we stay safe and secure when we are traveling? J. teaches us what red flags to look for when reserving and staying with Airbnb. With a few extra steps any problem can often be prevented and in turn, keep you safer and more secure.  If you have thought about operating your own Airbnb tune in to find out what you need to be on the lookout for, how to be a responsive host and tools that J. offers to help you succeed. 

Massey is a full-time Real Estate Investor, Entrepreneur, Popular Podcast Host, Author, Speaker, Coach & All-Around Problem Solver. Cashflow Diary is a short-term rental hospitality training company. We show people how to build their own short-term rental business (without needing to buy or own any property) so they can thrive financially. Heralded as the most advanced short-term rental training in the industry, Cashflow Diary enjoys creating content and communities that are solely focused on developing individuals into powerful business owners. Founded by J. Massey, Cashflow Diary exists to create short-term rental entrepreneurs. No matter your passion, he believes that running a hospitality business will change people’s lives…

Prior to entering the sharing economy, J. taught real estate strategies based on his years of experience. He owned hundreds of units, raised tens of millions of dollars, and even owned cell phone towers. He was all but “retired” at the age of 38 when one of his students asked what he knew about short-term rentals – the answer at the time was, “not very much.” He started looking into the model and was astounded at the opportunities it presented. J. now runs a 34 unit short-term rental business, and they create more profit faster than any other strategy he has seen before. That means that you too will now have a business that creates more profits to invest into whatever is most important to you—your family, your business, your future, and your community.

The bottom line is that because short-term rental businesses provide a financial safety net, you can take more risks, develop advanced business skills, and do more of what you’re passionate about.

“Keep your conversations inside the Airbnb platform.” - J. Massey Share on X

Show Notes:

“Read the listings. Don’t just look at the photos.” - J. Massey Share on X

On this episode of the Easy Prey podcast, I talk with J. Massey about short term rental scams. J. Massey is the CEO and founder of Cash Flow Diary, a training and development brand for building short term rental entrepreneurs. J. has a passion for helping other entrepreneurs succeed. Through his courses, he teaches students every step they should take to be able to start and run a profitable short-term rental business. I'm your host, Chris Parker, and this is the Easy Prey podcast.

Thank you for coming on. I really appreciate you spending some time with us today.

In talking about short-term rental scams, there was an article on VICE fall 2019, by Allie Conte. She details a story about her and her friends going off to Chicago for a concert. Just a couple of minutes before checking into her Airbnb, the host calls and says, “I'm sorry. The last guest overflowed the toilet, they flooded the units so I can't have you stay there until I can get a plumber out to fix it. But coincidentally, I do have another unit that is just right down the street and I could switch you over to that unit.” She starts getting a little bit nervous about his thoughts. “It's a much better unit, it's much bigger. I'll put you up there and we should be able to get the plumbing taken care of and back in the unit the next day.”

They get in the Uber and try to find this place, hunting going back and forth, and find it that it's this unit down an alley behind the main street, kind of a shady neighborhood. They get there, the front door is already unlocked. It's just left unlocked. Little bit creepy in and of itself. They get inside and it's basically a flophouse. There's just bunk beds and couches with cigarette holes in it, broken furniture. Someone else had punched a hole in the wall, probably because it was such a bad place. Just a horrible, horrible situation. They're like, “Whatever. That's okay, fine. We're going to get back in a nice place tomorrow.”

If they try to change locations on you at the last minute, be cautious.

Tomorrow comes and guess what? “I can't get the plumbing fixed and I've got other tenants coming into that location so you're out.” Yes, I can see your expression there, it's crazy. They ended up, “Okay, fine. Whatever. We'll find a hotel, pay more and we'll just sort it out after the fact.” They get home and she tries to deal with Airbnb to get a refund and it's this long, drawn-out disaster of trying to get a refund through Airbnb because the terms and conditions and how those transactions were, how the listing was canceled and switched over to the other one.

I'll throw a link in the show notes for those of you who want to read Allie's story and whole. It led into her writing a story about Airbnb scams. As she digs into this particular host and their listings, she finds a unit that has the same photos, same description, is being rented out by multiple people. It's not really a unit in the, not international scam, but it's a US wide scam, 80 properties or something like that.

A dozen or so accounts all kind of linked together, tangentially, goes back and forth with Airbnb over. Finally, ultimately, the good news is Airbnb gets rid of the scammers. But me, as a consumer, I'm used to traveling and staying at hotels and I've thought about staying at Airbnbs and stories like this just terrify me.

And they should.

Yeah, because what are you going to do? Having not been an avid Airbnb, I wouldn't even know what to look for in order to try to find out if this is a real unit, how do I even figure it out? What are some of the common scams that the end user, the renter, would face that they're potentially at risk of?

This one has a combination of a number of things. What I would really like to do, while you were laying it out, what I was doing is I was noticing, I was making notes of the actual points at which just the unwary. If you don't know what you don't know, you wouldn't know that you had an opportunity to discover this ahead of time. That's what was happening.

As you were talking, I was like, “Oh, okay. She didn't do this. Oh, that didn't happen.” I see how this could happen specifically if you've not used the platforms before. In fact, one of the things that I'm often telling individuals, either onstage or what have you, is the fact that the number one concern of people is safety, security. That's what we, as operators, have to address.

It's kind of a double-edged sword because the sharing economy is kind of birth because mom and pop can now do and provide something that typically was provided by a traditional company and in a bigger structure fashion. ‘How could someone have known?' is really the question here and then we'll definitely talk about some others because I want to break this one down. There's a number of things that I'm like, okay, that's what happened.

The challenge though is that it's close enough to stuff that actually happens to where you're like, “Hmm. It sounds good enough.” I get why this happened 100% because I've had properties flood and this happens, microwaves, or something not going right.

Here's the first thing, though. As a consumer, one of the best ways—like this could have been headed off really fast—if when you make your reservation, one of the things that you've also committed to is your departure time. That departure time is fixed, it's unchangeable, which means if there is someone who is arriving or who's leaving on the day that you arrive, if you suspect that this is the case, a good best practice would be to message the hosts that you are going to be staying with, right after the checkout time.

It is good practice to contact your host at the time of check-in even if you will not arrive until later.

If your checkout time is 11:00, but you know you're not getting there till, say, 6, 7 PM, message them right after 11:00 so that they have a chance to respond to your inquiry. Just simply ask them, “Hey, we're planning on arriving at 6:00. Is everything going to be ready for our arrival now?” Typically, if you're working with a professional host, they will be able to respond to that first of all, and let you know if anything has been discovered in terms of additional maintenance that may require additional time.

Also, just know that sometimes the host needs a little bit more time for their staff to arrive before they can get that report. But ultimately, you should get a response. If you don't get a response, because you haven't arrived yet, this is where you would call and involve Airbnb directly. What happens is that Airbnb begins to contact the host directly with a special number that we're required to provide them so that they can reach us.

Once they've tried, I think it's twice, if they don't get a response on the third attempt, they send us a message, something to the effect of, “Hey, we've tried to contact you two times. Your guest is trying to get in contact with you. If we don't hear back from you within the next 30 minutes, we are going to cancel this reservation and rebook the guest somewhere else.” Then, they charge us all kinds of penalties and extra stuff.

I assume the guest gets a full refund from the original booking?

No. They'll switch them somewhere else. They will take it upon themselves to then get on the phone and start calling other hosts in the area near where you said you wanted to be to find out who has availability—I always like it when we get those calls because those are the easy ones—because somebody else messed up and then they bring them. They say, “Okay, cool.” That's a very good place to be but that's exactly right. You've enlisted their help in order to avoid those things. See that? That's just one. If you just do that, the rest of everything here just can't happen because if someone doesn't have good intent, it'll be discovered.

Going back, what's a reasonable time for the host to be able to get back to someone? If the previous checkout time was 11:00 and then you text at 11:05, the host was like, “Oh gosh, I haven't had my cleaning crew come in. We haven't had a chance to check it out.” What's a reasonable amount of time for them to be able to get in there and check it? If someone was a scammer, they're going to say, “Oh, I haven’t had my cleaning crew in there yet.”

The way that we run things with our cleaning crew, depending on the size of the unit, they are tasked with getting two cleanings done between 11:00 and 4:00. That's the gap we run which means you can't arrive at that first one no later than 11:30, and you must be done by 1:00 if you have a shot at your second one and get it done before the next guest arrives.

Hosts need time to clean and fix the rental unit between guests.

I know for us, if you contact us at around 12:30, we will know not only if something needed to be replaced, if it was already replaced, or if it's going to take us longer or if there's a maintenance issue that might still be happening or risk being resolved as you arrive. That's enough time for us to know we have to dispatch a plumber or somebody has got to run to the supply closet and get these things, and replace it and all that stuff that we have to do.

I would say no more than 90 minutes, especially on the day of arrival, because Airbnb–all of the platforms actually–does such a good job of reminding us, “Hey, Stephanie's coming. Hey, they're coming. They're coming today. Make sure you're ready.” They send so many notifications to remind. Even the hobbyists, even if you're just doing the hosting on a weekend as a weekend gig, you get enough reminders to make sure that you're ready.

One of the things our search placement is judged upon is response time. Those who have a habit of not responding tend to incur a penalty when it comes to search placement inside of their database.

Got you. Hosts that are less communicative, less responsive, their listing is kind of get pushed down on search results for those that are more responsive to their customers are going to be more likely to have their search results at the top?

Exactly because, again, that's what Airbnb incentivizes and wants. When you do that one thing, you're now in position to have a great defense against something happening. The second thing and probably the biggest actually is keep the conversation inside their platform. I know it can feel like it's inconvenient and sometimes their app doesn't work perfectly and you can't find the message. As a consumer, you're just thinking, why can't I just call them? It would be easier. The challenge is that they can't see that conversation. They don't know what was said.

By ‘they' you mean Airbnb or other platforms?

Once you take the conversation outside of the platform, they have no way to know who said what. That's part of the challenge. But if you keep the conversation inside there, then they'll be able to see the entire thread from the beginning. When you contact them, they'll be able to understand exactly what's going on and provide you support as needed. If either one of those two things had been done in this particular case, not only would the refund process have been easier, but it likely wouldn't have happened at all.

Is it normal if a host does have a problem for them to be able to switch over to another location if they happen to have one nearby?

Yeah. We do that when we've had situations, maybe someone smoked excessively and our remediation team hasn't been able or won't be able to get there in time. Yeah, we'll do that. That happens, that just happens. That's just a fact. It's not uncommon when you're working with those who have multiple locations, that they have the ability to do that. That part, that's normal. It's just certain issues like a plumbing issue.

A plumbing issue, it's usually not just before check-in, you typically find that almost immediately because when your cleaning crew arrives, the first thing that they should be doing is doing a complete inspection, finding out what's broken and or missing so that they can report back to, we'll call it, home office so that you can decide what needs to happen next. Leaks are typically discovered fast. That's one of the reasons we started putting electronic leak detectors inside of all of our units so that we will know. We'll be the first to know and it won't be a burden upon our staff or our guests to make sure that that happens.

It's a great way to do that.

Right. All of these Internet of things, home, smart home stuff, we just use them differently so that we can make sure we're providing the clean, safe, affordable home that we've promised.

Got you. Is there anything else about that interaction with Allie that caught your attention of, hey, this was a red flag?

Oh, yeah. There's a number of things. Let's pretend that the host is going to move you. Let's say that's where you are. First and foremost, just ask for a copy of the listing. Give me a link to the listing. Now, the listing needs to be on the exact same platform that you made your original reservation on. Just get the listing because one of the things you'll be able to, again, do—because every listing has a unique identifier—in this particular case, call Airbnb. “Hey, this is what's going on,” and they're saying I can go to this one.

Does this listing have the adequate… Because here's where I'm staying. Airbnb has access to all of the conversations from prior guests. They have access to all of the reviews on both sides. They have access to what are called private comments that go back and forth. They can see everything to help you feel safe and secure.

There are different levels of assistance you can get with Airbnb.

In fact, they have three levels of support. The level of support I'm thinking of right now, it's called trust and safety. If that's something you're concerned about, just call on the phone. When you get the first level person, just say, “Hey, this is what's going on. Here are the keywords.” You just say these words and the gates open. I don't feel comfortable. Then you fill in whatever that was making you feel uncomfortable.

They begin to help on your behalf to make sure, verify, call people, whatever it is that you need. Just like any legitimate host, they want you to stay. They'll start working on your behalf to help make that happen so that they can verify and get to a point of a reasonable surety that, yes, other people have stayed there before or if it's a new listing. Yes, this host has had thousands of thousands of reservations. There's nothing to suggest that there's anything.

While they can't divulge private information, they can give you enough to be reasonably comfortable to find out that that listing is still legitimate and it should meet your needs, or at least what they're saying, what they're advertising, is amenities comparable to the place that you actually made the reservation on.

Yeah, that's good.

Those three things right there, any one of those three things would have made this entire… You would have either discovered it or the refund process would've been simpler. There's so many things. For those that are listening that have any sort of experience with homes, I don't know any plumbing issue that gets solved, especially if it's the water that gets solved in a day. That's not good. You're not staying there tomorrow, there's no version of this being a one-day thing.

Let's pretend everything else is legitimate and this is going. Maybe the guy just doesn't know that it can't be resolved that fast. You're going to end up staying somewhere else because when the bathroom leaks and all this other stuff, it is such a hassle to re-accommodate them. We've done it, I don't like it, and it's expensive, but it's never done in a day.

Again, this is like all scams. There's a pressure point, there's something happened, there's drama, there's emotion. Well, you've got to make a decision in the next five minutes or else I can't do this. All these things put you in a position where you're almost guaranteed to make bad decisions when everything stacks up against you.

You will. Every listing can have a unique cancellation policy. That's where understanding what the rights exist in terms of the cancellation policy because depending on the cancellation policy that's chosen, you have certain rights available to you. For example, there's one called flexible, in this particular case, which gives you probably the most rights as a consumer. Up until the time you literally look at the door, you can do whatever you want and you're not under any pressure to make a decision.

The challenge is, typically, if you're going to a place, there are other people who were there. Is there availability somewhere else? That's a completely different question. But the platforms have done a reasonably decent job, in my opinion, of still giving you an option. You, oftentimes, are just not aware of them. What's unfortunate is that, especially in Airbnb's case, there are multiple places during the reservation process like before you make the reservation where you are asked to confirm that you understand. Unfortunately, most people choose not to.

I haven't seen their particular thing but it's probably very typical of most software applications and websites when you go to it's 45 pages of legalese that even if you did have the 3 hours to read it, you wouldn't know what it means. Are the platforms, in your opinion, working to kind of simplify those options and communicate them more clearly?

Be sure to read the rules for each rental you stay in.

Yes. In fact, and again, this is only specific to Airbnb—HomeAway, booking.com, and many others, they're trying to play catch up here. They have the host create a simplified version for you that is usually bullet pointed and that you actually have to accept separately. It's actually not like just one small check mark near the submit button. It's literally a separate section. The small check mark is their own terms and conditions. House rules of each individual host are something that you also have to agree to, and that is a very separate, deliberately separate checkmark that must be done.

That would be something like what's happened in California's party houses and things like that. Certain activities can't happen on this property.

Absolutely, right. Party house, no. We don't. That's not going to happen. We'll just know, we will know already if that's your intent. I know it sounds crazy, but on the operator side, there's a pattern. It is predictable to those who have less than honest intent and it's really, really clear for us. There are certain things that happen in a certain order or with a certain frequency and we go, “Okay, cool. Let's watch this one. We just literally flag it and have our team watch and we're waiting. As soon as they go,”Okay, that's what we thought. Let's get them out. Next.” That's just what happens. We know it's coming and we're prepared and we're enabled and empowered to be able to make corrections when needed.

What about the situations where the person gets there, they get into the property and it was advertised as a three bedroom penthouse suite and it turns out to be a two bedroom condo? The carpet's peeling off the floor and all that kind of stuff where it's just substantially different than what the listing indicated.

Yeah. The keyword you said is substantially or they use the word materially different. What this is, this is depending on your documentation because this is what it’s going to come down to, is your documentation. You have to document that this substantial difference relative to the photos and the description that was given. That's where that is in now because everyone has a cell phone with a camera.

I would recommend, though, you still take video even though you can't send video through their app or directly to them, uploaded to a Google drive and didn't send the link to Airbnb and that will give them the support material of what's going to happen. As soon as you do that, they then contact us and say, “Hey, this is what they're saying is present and we don't see any evidence of it in your photos. We don't see any disclosure. You never told them. Is this true or not?” We have an opportunity to respond.

Most of the time, like I said, if it's materially different and there's nothing that was inside of our control that we could have done to prevent, tell you, or warn you, et cetera, then you end up with 100% of your money back. If you want, they will assist you with a rebooking situation 100% of the time if, again, the issue is availability. That's usually the biggest challenge. It depends on what your arrival time is because after a certain time, depending on time zones and country, they can't contact us and it has to wait until the morning. That's when it's really, really tough because it's usually late at night or something of that nature.

If you are traveling and you know your arrival time is late, everything that we've discussed, it's really important that you do before that cutoff time, which is usually around 10 PM, for that cutoff time because it's going to be hard for them. Their hands are going to be tied by certain laws but they just can't break until the morning and they just have to wait unless it's a verified emergency, fire, flood, something like that but that's not what we'd be dealing with at that time.

Got you. Are there any taking it like a step before all this happens? Is there something that people should be looking for in the listings that should be red flags or warning signs based off of listings?

Read them. Don't just look at photos. I know it sounds basic, but that's really what it comes down to. One of the things that Airbnb also does is that they'll penalize us for using the same words over and over and over again like any other search engine. We can't just copy and paste, even if you have 10 units, the exact same location. We have to come up with different ways of saying the same thing.

Additionally, if you begin to see something where the photos begin to look similar, then ask. There's nothing wrong, nothing wrong with you taking a screenshot of it. If you are suspicious of a place, take a screenshot of many or any of the photos. Just do a Google image search. It'll tell you really quickly like, we found this here, here, here. If you see a stock image, to tell you really fast that, “Something is up here,” and you will be able to take appropriate action at that site.

Got you. I guess the other question is, coming from the opposite side, as a host or someone who owns a property that you're wanting to put out in Airbnb or any of the short-term rental platforms are there scams that guests try to put on the host? What are those scams?

Absolutely, 100%. It depends on the season, depends on the country but because there are certain ones that are popular for certain times of the year. I will say likely the most common, the most common, top one, is unfortunately very out of control and it's hard, our hands are kind of tied. There's a lot of abuse of the whole emotional support animals, service animals, and whatnot because there are just certain things we can't say or ask and do.

Interestingly, most people don't understand. In the number of states, it's actually a misdemeanor that can result in fines and some jail time. It's interesting but that's probably the biggest issue. I know that there is not enough inventory to serve those of you who want to travel with your pet but just tell us, just please tell us. Sometimes, and this is definitely the case.

There are some places where we can have pets, but we say no because of the way people tend to abuse that, ‘oh, well, it's pet friendly so this should be okay' type of situation. We'll make that person have to ask us and then it gives us the ability to respond and say, “Okay, tell us. We need to know things like height, weight, breed for all the reasons,” because unfortunately, what some people call a pet today can get a little creative.

An emotional support pony?

Well, I was thinking pig. Wish I could make this stuff up. That's probably the biggest abuse by far. The challenge is, oftentimes, we can probably direct you to the correct location. Like in our case, we can say, “Hey, this location would be better than the one that you've chosen and here's why, especially with your animal,” because on the opposite side, people who are deathly allergic to certain things and we do our best to keep those locations as free from all the stuff your pet brings.

It's just a lot of work in that regard. That's probably the most common, most abused right after them telling us that only two people are coming. Then why did you rent a two-bedroom? Honestly, it's one of the questions that my staff is trained to ask and remind you, “Hey, you rented a two-bedroom and your reservation says there's only one. How many people are actually coming? We need to know.”

I know that depending on the quality of host that you've dealt with, maybe they didn't care, you got away with it, what have you but I promise you, that's literally why my company exists. It's to help those operators learn how to know things like how many people are there and a very compliant, safe fashion, because that's a security risk, not only to yourself but to everyone else who lives in that neighborhood. I know you're not thinking about that, but we have to. We're the ones with the longstanding relationship with the community, with the apartment complex, with the neighborhood. Just tell us. We can probably work something out, we just need to know.

Once we know, then we can help you have a better experience, because like you, if you do that in our location where we are at this moment, if you tell us ahead of time, it's only $20 per night extra. If you don't tell us and we discover it, it becomes $50 per night extra. If we discover it and then you refuse to pay it, we have a written, very followable procedure to have the police literally at your doorstep within nine minutes or less.

So, tell us. That's all I'm saying because we have to provide a clean, safe, affordable environment. You don't know next door to you is likely someone, and especially in our case, who's recovering from a possible surgery or something that major because we do a lot of work with hospitals. Unfortunately, we also do a lot of work with battered women, people who are escaping unfortunate situations. When you do what you do, that affects people to the left, right above next door, whatnot, and it could just result in some very bad things.

To be very transparent, clear, we have had guests arrested. That's just what it comes down to. You have to just let us know. We can probably accommodate you but if we don't know, it trips a whole bunch of security and then you're stuck. You don't want to be explaining something that was very basic with a flashlight in your face with the police and the blue lights flash. You don't want to be in that situation so please tell us.

Yeah. Particularly at 2:00 in the morning with all the neighbors shaking their heads out the windows.

You don't want that. Those things are there, probably some of the ones that are just obvious. Let's just say, if you're dealing with a host, we know what a bedbug looks like, we really do. We know what a bedbug looks like and you're sending us a blurry photo that's unidentifiable and calling it a bedbug, I mean, we understand, we got it.

That's also very common where they will try to claim that there were insects or this or that and the other but you can never tell like legitimately where they are. Some of them are so obvious. It's like, “Look, I found this on the floor,” and I'm like, “That's a hardwood floor, we have carpet in that room. What are you talking about?” They'll try to submit pictures that are not your location.

Also, oh my God, this one is funny. There was a time, one of my students, it was the funniest thing ever because she was asking for some support, what do I do? She's messaging me, telling me that she can't get in, she can't find parking, she doesn't know where the location is. I've sent her the information multiple times and I'm like, “Got it? Everybody else has been able to find it. “Help me. What do I do?” I was like, “Okay, cool. Let's check your security procedures, look at everything.”

People try to scam Airbnb owners as well.

I wish I was making this up, but guess what? Not only in the unit, but she was also waiting for the pizza delivery guy to arrive. That's what we eventually found out. But mind you, she's messaging, “I can't get in. You need to help me or else I want a refund.” That's interesting. It's also in the terms and conditions, grounds for what is also considered extortion. Just know that there are things that are there but what can be very, very common is, “Hey, I couldn't get in, I never got in. I never stayed there.”

It becomes incumbent upon the operator to prove not only did you stay there, but this is also how many people came with you, this is what time you entered, this is how many times you opened the door. That's what it becomes down to. “By the way, here's the video that looks like you to me. That not you?”

Here we are back to the Internet of Things with electronic door locks, with, I assume, key codes that change for every different rental. “You are the only person who had the key code and it opened at 10:00 You were obviously there.”

Correct. Or, you gave it to someone. Either way, you're the responsible party. That's really what it's like. These are things that you had to learn to defend against in some cases. We have a number of expert tools. One of the things we specialize in is helping people learn how to use them expertly because that's what matters. One of the false positives that's out there right now for sure is the amount of noise that comes from a short-term rental. We spend more time while we have it.

We have a way to monitor the decibels that come out of one of our short-term rentals so we know exactly literally the measurement to the minute. We spend more time proving that the party, the noise, the whatever you heard wasn't us, it's our guest, because people will often default and try to blame the short-term rental when it usually wasn't because if a host knows how to do proper screening and checks on the front end, most everything that you have seen in the news—this is where it gets under my skin—is 100% preventable.

We would have screened it out or caught it before it escalated because we would have had. They have to trip one of the security procedures and we've got people literally on staff 24/7. That's their job, is to make sure that as soon as anything gets a trip to resolve it.

It sounds like there's a big difference between a host who has a vacation home, that they're just looking it up in the mountains or something like that, they're just looking to make a little bit extra money here and there. People who are actually doing this for a living that they're buying property or renting property and renting out short-term rentals because you've talked a lot about processes and procedures. Is that what makes this a viable business model for those that have multiple units that they're renting out?

Yeah. That amongst many other things. What it comes down to is that the marketplace, the consumer habits, it's those of you watching, listening to this right now, it's your habits. All of our consumer habits have shifted away from I want to own the thing to I want to only use the thing. I only want to pay for it when I need it. Not before, not after, and I definitely want to pay to store anymore.

How can I just use it for this little slice of time? Okay, great. This is a response to that. What it comes down to is, is it's a very efficient way of providing housing. Most importantly, it creates this opportunity where demand is really, really high because it's a completely different experience. It's not like staying at a traditional accommodation or like a hotel or what have you is the same as staying in a short term rental. The value is there, it's just not obvious.

Here's a fun experiment. Call a hotel, ask them what the daily rate is and then ask them what the square footage of the room is. Now, go look at a short-term rental, almost any of them, find out what the rate is. If you can, ask the operator what's the square footage of the apartment, a room, house, or whatever it is that you're looking at.

When you do the math—because we do this at the grocery store—you know how many cents per ounce you pay for your green beans and your cereal. But now do the dollars per night per square foot. Do the comparison. You will see how much you're really paying for how little you're actually getting in exchange. If all we were talking about was space square footage or cubic feet, what have you, we'd win hands down every time. But many of you, when we travel, there's a hidden cost that no one thinks about.

If you stay in a hotel, you make the decision to eat out for the vacation, but with an Airbnb – many times you have options.

It's the knock, knock, knock, knock at 2:00 in the morning at the door next to you.

Well, that part of it for sure or something else uncontrollable. But also, when you go to a hotel, you also decide, you've made a second decision. We are eating out, period. You've made it. That's the second decision that you've made. But yet, the hotel doesn't “get the blame for that cost.” In some cases, especially when it relates to medical travel, sometimes you have a specialized diet that you're actually trying to follow or the doctor says you have to follow and that can be challenging if you have to eat out. Whereas, in a lot of our cases, for sure, you got a full kitchen or kitchenette or something. You have access or a way to control some of that so that you don't have to, by default, also eat out.

Oftentimes, people just don't even calculate that expense. Families who have ever tried to travel with their children, know the pain of trying to find two adjoining rooms and the cost of finding two adjoining rooms. You got to find two adjoining rooms for a length of time. Do you really want little Johnny in that room with his sister? Oh, that sounds scary. I don't know how this is going to work. “Let's all cram into one room and we'll figure it out.” It's a different experience all the way around.

The demand is there, that's really what it is, the demand. When you look at all the numbers, the economics of the situation, right now, you don't even have to be good, you just have to be present and that's part of the problem. That's why people are easy prey. It's simply because the demand is so high, you just have to be present.

I've seen things like people literally take a photo of a picnic table, put it in a kitchen, and they still have reservations at the picnic. It doesn't even look like it was cleaned, but it doesn't matter because the demand for a different experience is so high that people are making reservations. You can't necessarily just go, well, “Other people have stayed here.” Well, you don't know what might have motivated them to choose that location.

If someone wants to figure out, is running short-term rental properties something I want to look at? Is there a tool or something that you offer to help people with that?

Absolutely. That's literally what we do in Cash Flow Diary. In fact, so much so that people ask me all the time. “Okay, J. I want to get into real estate and I want to retire, how many units do I need?” They ask me so much, I created the calculator. Just do it on your own and you just go to cashflowdiary.com/howmanyunits. It's literally like the beginning of your question, how many units do I need?

Put in your information at the end. It's going to tell you based upon your age, when you want to retire and your income, et cetera. This is the number of units you need; if you want to use a three-bedroom, a two-bedroom, apartment building so that you can now know how many units you need. What we've learned is that a lot of people are surprised that that number is a lot less than I thought.

That's cool. If people want to follow you on social media, how do they go ahead and do that?

We have a podcast, it's cashflowdiary.com but in essence, if you type Cash Flow Diary, almost anywhere in Google or any social media platform, we're there. Yeah, even TikTok.

Wow, TikTok. J, I want to thank you so much for coming on the show today and helping our listeners be able to keep themselves safer and keep yourselves secure when they're traveling and making sure that they're not easy prey for a short-term rental scams.

Yes. Thank you for having me.

Thanks for joining us on Easy Prey. Be sure to subscribe to our podcast on iTunes and leave a nice review. 

Links and Resources:

Exit mobile version