Spencer Giles and Ashley Antidormi
Sarah: Spencer Giles and Ashley Antidormi are Niagara based real estate investors, and they share a love of fitness, travel and dogs. They started investing in 2018 and have since expanded their portfolio to 15 units with a mix of short-term and long-term rentals. They also co-founded Travel Luxe Property Management, which is an Airbnb management company, which has grown to become one of the most popular Airbnb property management companies in the Niagara area.
Their dream is to become time and financially independent using real estate as their main vehicle. So, they're able to continue traveling the world. Awesome cashflow, tenants, laws, the bylaws, the good, the bad and ugly is what we're going to talk about today. Ashley and Spencer, welcome.
Spencer: Yeah, thanks for having us. Hello everyone, thanks for having us. So, today we're gonna quickly go over some of our stories and share the success that we've had with Airbnb and also provide some tips.
Ashley: And just a little background on us. We met about six years ago. We love to travel. We decided that we wanted to do more than just three or four weeks of traveling a year. So, we ended up getting into real estate. And I actually started by first purchasing the house that we live in right now, about 10 years ago. I had a few tenants upstairs who basically paid down the mortgage for me.
And then in 2019, Spencer had gotten into real estate about a year before me, I believe. And he said, Hey, you're sitting on a ton of equity in this house. And that's when I took out a home equity line of credit and our journey really started.
Spencer: And yeah, my initial start wasn't the traditional by long-term rental, I went right into short-term. I partnered with someone who was well versed in the area that knew what they were doing and it just hit the ground running. So, all of our properties have been the value, add force, appreciation, the BRRRR method.
This has allowed us to scale our portfolio quite quickly. Not only being able to pull a lot of equity out to buy other ones, but the cash flow is insane. It's much better than the typical market rent.
So yeah, that one thing led to another we're now at 15 units owned soon to be 18, we've got three more closing in the next month. So, that's exciting stuff. And yeah our management company, we've grown over the last year and a half to 13 properties.
Ashley: So, we get the question all the time. How did you start in short-term rentals? Because that's not usually where people start, but one reason is cash flow.
Spencer: Yeah. Cash is king, just to give you an example of that first property that I purchased, the market rent itself was about $2,500 a month. If you were going to go for a long term, that one specifically last year did $73,000 gross. And the expenses on it were 39,000. So long story short, it ended up netting about $2,800 a month in cash flow, which you would not even be able to come close to if we were to go long-term rent. So that's one of the main reasons.
Ashley: Obviously, we know we are more skewed towards the landlord. Anyway the tenant laws are more skewed towards the tenant and not so much the landlord. We've seen a lot of horror stories and all of that, and we really wanted to avoid that.
Spencer: Obviously, one of the main reasons is the professional cleaning, having your place well-maintained and professionally cleaned two to three times a week. It's a lot of peace of mind. And with Airbnb being on a review-based platform most guests are going to be obliged to leave your place just the way they found it when they got there. So that was also really appealing.
Ashley: And then obviously Airbnb has more protection. We do suggest commercial insurance, but it does pay to have a little more protection.
Spencer: And the most important reason, because we love to travel is this can be run from anywhere.
So as long as you have the system and the teams in place this is a business that can be run on a beach in Costa Rica. That's the whole reason why we did this to have the time. Now, with all that, it's not all Skittles and rainbows. There are some downsides and some challenges.
The number one thing, or a couple of reasons is financing can be quite difficult after you've acquired your second or third property. The banks typically don't see short-term rentals as income, so it makes it more difficult to scale.
Ashley: And obviously there is a lot of coordination. You have to make sure that your cleaners are there between 11 and four every time. It's not like they're just cleaning every Monday or every other month. Garbage, lawn care, snow removal. There's a lot of coordination there. And then there's obviously upfront costs for furniture supplies. We usually budget like 10 to 20 grand depending on the property size that a lot of people don't always think about.
Spencer: And another thing to look out for is obviously there is some neighborhood negativity going around when people hear the term Airbnb or short-term rental, they immediately assume parties. So, there are things that you want to put in place to ensure that not only are you running a good business, but you're also respecting the community and the neighborhood as well.
And then, yeah, obviously as full-proof as you try to be, you get the odd, bad guests once in a while. We've got a few horror stories. You can see the one picture there that wasn't too bad, but you can't point out all the broken glass that does happen once in a while, but it is nice to know that you are protected from Airbnb. And if you do have your own insurance, definitely.
Yeah, that being said, a couple of keys to success that we found are super important when you're looking to purchase an Airbnb. The number one thing we recommend is to make sure you're familiar with all the bylaws, make sure that it's allowed. And if there is a licensing process, make sure you do your due diligence there to ensure that it is doable.
Ashley: And then cleaning and maintenance teams will be your absolute saviors. You really need to lock these down, get someone reliable commercial insurance. We definitely think that's a must.
Spencer: And yeah, you mentioned before when you're doing your due diligence location, that is everything. James mentioned AirDNA. It's an amazing platform. You can go on and take a look at all the comparable in the area that you're looking at. If you're honed in on a specific property, run the comparable, run the numbers, see if it makes sense. And if it does, execute.
Ashley: And then response time is huge. We like to keep it within at least an hour. If you respond within five hours, you could have lost that guest to another property. So that's really big, a strong vetting process.
We don't allow just anyone on our properties. We really want to maintain them. So, having cameras on the outside, having noise sensors to check for parties, all that is big.
Spencer: And again pricing is extremely important. I know it was already mentioned, but in high season, you want to make sure that you're capturing that top dollar and that in low season, when there is less demand that you're capturing those bookings well in advance to fill the calendar.
So, that's extremely important. If you just set it on the Airbnb smart pricing, there's a good chance you're missing out on 20% to 30% plus and that being said, another tip that we recommend is to have backup systems in place. So, one example is the keypad lock. If the battery dies and you don't have a lockbox with an extra key or guess who has to go to the property.
So, if you had that in place, it's a much smoother process. So, having these types of systems will allow you to run a successful business, keep the guests happy and also scale.
Ashley: And then invest back into the business. We just put a sauna in one of our properties. We redid a deck in the backyard where I'm at our other properties, which kind of leads to stand out professional photos.
The design of the house, the backyard space, especially now with the pandemic and low season amenities, like a hot tub.
Spencer: Yeah, those are some tips that we have on running it. Getting back to more of the investor side. So, you can only buy so many properties. It gets a lot more difficult.
So, we know that we have the resources here to operate this and scale this a lot faster. So, we came up with the management idea to help other investors run their properties because we have the teams, we have the cleaning team, the maintenance crew. So, we started this a year and a half ago.
So, what essentially, we do is we run these for other people. It allowed us to earn a decent income while limiting our risks and scaling faster.
Ashley: Hands off approach for investors who may not have the time or want to run their own property management on Airbnb. So, that's good and then it helps when we have investors who may not be from the area.
And we actually had a story of locking themselves in a bedroom, in a short-term rental and the owners are not from the area. And we had to run at 2:00 AM on St. Patrick's Day. And we had to run a key over in the middle of the night.
Spencer: Yeah, again, just having those systems in places is key, but making sure that you have those feet on the ground in the area, someone close by, if you do decide to manage these yourself it's super important because response is everything. So, make sure that you have all those areas covered. Don't leave any stones unturned.
Ashley: Just other tips for managing, running comparable, outlining all the risks, response time, keeping in contact with the client is huge. And then obviously making it as hands-off as possible for them.
Spencer: So, let's talk about the last year and a half running a short-term rental during this pandemic. So, there's been a lot of different trends. We definitely have seen a shift in the population, but the number one thing we recommend is obviously abide by the provincial guidelines. If it's essential workers, only making sure that you're not breaking any rules.
Ashley: And then obviously more people are able to work remotely. So, things like WIFI, outdoor amenities are huge. We have actually pivoted a lot of our online platforms to cater to more essential workers, which has been really great. And then obviously local getaways.
Spencer: And then obviously cleaning and sanitizing, having that awesome rockstar cleaning team, unless you're doing it yourself is super imperative. You need to make sure that you're following their five-step cleaning process. And making sure that when every guest shows up that they know it's been properly sanitized.
Ashley: And overall summer did better than others. The ones we have near a beach did really well. Whereas the area, like Niagara falls, which typically see more international tourists didn't do as well. But we just catered to more essential workers. So, they got some money.
Spencer: Yeah, again, at the end of the day, do your research. Programs like AirDNA do due diligence, run the numbers.
If you are looking to do something like this, it is a very great platform and we definitely recommend it.
Sarah: Amazing Spencer, Ashley. That's great. Now, if somebody has a rental property and they want you to manage roughly how hands-on are you guys? And just like maybe just a brief explanation on the costs, if you would mind?
Spencer: Yeah, absolutely. So, we do everything. We run it like it's our own property.
We give the recommendations. If they're in the renovation stage to tailor it to the guests. Yeah. We handle all the cleaners, any maintenance, any repairs, all of that stuff. Garbage you name it essentially. It's completely hands off. And our services typically 20% to 25%, depending on how hands-on the investor or the owner wants to be.
Sarah: Awesome. And what's the area that you cover?
Spencer: Right now? We covered normally the Niagara region. We've expanded out to Hamilton and soon in the states. Okay.
Sarah: All right. Very cool. Ashley and Spencer thank you guys so much for being with us.
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