Assuming you intend to make money with your short-term rental business, it should go without saying that every day unrented is missed opportunity for your home. In the case of a new home purchase, that timer starts the minute you gain access to the house (preferably at closing). In the past 3 months I have completed the close-to-listing process with 2 homes, and am really finding ways to move faster and faster through the setup, furnishing, and listing processes so I can start making money on new investments as soon as possible. In this post I’m going to lay out 3 critical elements which I have adopted in my practice to get my rentals making money quickly. Hopefully this will help you put heads in beds quicker than you would have thought possible.
Tip 1. Don’t Wait Until You Get the Keys to Get Started
Just because you can’t get in the house before closing, it doesn’t mean you can’t get started on your new investment. After having seen the home during your initial visit and then again during your inspection, there’s no doubt you’ll have an idea of the basic things you’ll need to buy in order to furnish the place and equip it for living. Even if you’ve forgotten the color of the walls in the second bedroom or the number of cabinets in the kitchen, you can-and-should get started shopping while you await the final transfer of ownership.
Now, if you’re saying to yourself “Where am I supposed to keep this stuff in the meantime? I don’t have the storage space necessary for a whole second home’s worth of stuff!”, don’t worry. Thanks to the logistical wonder of sites like Amazon (Prime 2-day shipping especially..), I was able to time my checkout to allow many of my items for my second rental to be delivered the day of closing. In fact, when I met the seller at the title company to sign the documents he opened with, laughing (and probably annoyed), “You got a few packages today, huh?” When I showed up to the house, I saw the mountain of 19 boxes sitting on the porch, ready for me to get to work as soon as I turned that key for the first time.
Of course, this shipping shortcut isn’t for everybody – If your new rental is an apartment unit or in an area in which you wouldn’t feel safe leaving packages on the porch for even a day, consider making room at home while you shop and then cram that car full or borrow a truck on the day of closing. In another post I’ll talk more about what to buy and where to buy it… as local thrift shops will become a lifesaver for many essentials for your new short-term rental.
Tip 2. Time Your Closing Intentionally
This step is going to seem a little nit-picky – a little anal – but when you desire your turnaround time to be a matter of weeks, or even days, every hour counts.
My second rental is in the same area as my first – a little town an hour and a half north of my home. Knowing that my weekdays were very preoccupied with my day job and the business I run afterhours, I knew I needed to make the most of my weekends to get this place ready. With a few weeks before closing, I told my real estate agent that I wanted the closing date to be on Friday, preferably in the early morning. By making the declaration early in the process, my agent was able to ask the seller’s agent and the title company if they could accommodate my timing, rather than the other way around.
With everyone onboard with a Friday morning closing appointment, I was then able to spend the entire weekend working my butt off to get the house rent-ready. This allowed me to be incredibly efficient with my time, all while only taking one day off from my day job and sleeping in the bedroom which I was sure to get bed-equipped as my first chore. At the end of that weekend I had the place extremely close to picture-ready. All I needed was the following weekend for finishing touches. Thus, my “two-week turnaround” benchmark was born.
Tip 3. Understand Lead Times for All Projects
This last tip is something engrained in my brain from my experience and schooling in the art of project management. It’s pretty simple, though – if something takes a long time, get started on it first. This is especially true for anything that you will be hiring-out. Say your inspection indicates the need for a roof repair. You don’t know much about fixing a roof, but you know it’s the largest project that needs to be done. You call the local roofing company right away and they indicate a 1 week timeframe to get your job done. You’re bummed by the delay, but you’re glad you didn’t wait to make this call. With a nod back to tip 1, you may even call the roofing company right after the inspection to inquire about the lead time, rather than wait until the house is “yours”. While you wait out this lead time, you can get to work on the other tasks that require your attention.
In another example, one big undertaking during my first rental purchase was trying to answer the question “Who is going to clean the house between guests?” Knowing that cleaning a hotel-like atmosphere with short guest-to-guest turnaround times would require a special type of cleaning professional, I got started on my search as soon as I knew the deal wasn’t going to fall through. It took multiple calls and a thoughtful screening process for me to find my perfect cleaning partner. By starting on the most challenging feats first, you give yourself the best chance of not letting hang-ups delay the launch of your rental.
The three things discussed in this post, along with an obsession with this endeavor, allowed me to turn a house into a home in two weekends’ time. My next goal is to shorten that to a one-weekend turnaround. I’ll be sure to share with you any new tips that help me get there. If you have any other best practices that have helped you hurry toward hosting, let me know in the comments! Thank you for reading.