Digital Social Hour
Why Vacation Rentals Beat Traditional Real Estate | Avery Carl DSH #1176
Wed, 12 Feb
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Discover why vacation rentals are outperforming traditional real estate investments in 2025! Real estate expert Avery Carl shares how she built a thriving portfolio of 250+ properties and reveals the secrets to succeeding in today's vacation rental market. 🏠 Learn how vacation rentals can generate the same income as a full-time job while you sleep, and why choosing the right market is crucial for long-term success. From beach towns to mountain getaways, Avery breaks down which locations offer the best returns and how to avoid common pitfalls that trip up new investors. Get insider knowledge on property management, guest screening, and building systems that scale. Find out why some cities are banning short-term rentals while others welcome them, and how to position yourself in markets with decades of proven tourism demand. Whether you're a seasoned investor or just starting out, this episode is packed with actionable strategies to build wealth through vacation rentals. Learn about creative financing options, tax advantages, and how to compete in today's evolving real estate landscape. Don't miss Avery's insights on market trends, investment strategies, and why vacation rentals could be your gateway to financial freedom. Plus, discover why traditional real estate might be holding you back from achieving your wealth-building goals. 🔑 CHAPTERS: 00:00 - Intro 00:26 - Airbnb Market Trends 04:10 - Bartending Experience Impact 05:00 - Specialized Recruiting Insights 05:47 - Is College Worth It? 08:57 - Short Term Rental Workload 09:49 - Scaling Real Estate Portfolio 11:47 - Real Estate Mentorship Experience 17:40 - Cities Banning Short Term Rentals 20:00 - Tenant Screening Process 22:30 - Bad Incidents in Rentals 24:05 - Book 2 Overview 24:25 - Capital Intensity in Real Estate 28:38 - Economic Predictions: Another 2008? 31:07 - The Short Term Show Overview 32:28 - The Short Term Shop Insights 33:27 - Outro APPLY TO BE ON THE PODCAST: https://www.digitalsocialhour.com/application BUSINESS INQUIRIES/SPONSORS: [email protected] GUEST: Avery Carl https://www.instagram.com/theshorttermshop https://www.youtube.com/theshorttermshop https://theshorttermshop.com/ SPONSORS: Specialized Recruiting Group: https://www.srgpros.com/ LISTEN ON: Apple Podcasts: https://podcasts.apple.com/us/podcast/digital-social-hour/id1676846015 Spotify: https://open.spotify.com/show/5Jn7LXarRlI8Hc0GtTn759 Sean Kelly Instagram: https://www.instagram.com/seanmikekelly/ Digital Social Hour works with participants in sponsored media and stays compliant with Federal Communications Commission (FCC) regulations regarding sponsored media. #ad #biggerpockets #mortgagerates #howtogetmorebookings #airbnbarbitrage #vacationrentals
Chapter 1: How did Avery Carl start with vacation rentals?
Everything on my corporate dream job, I was making about $1,000 a month. And then this house was making the same amount of money as me while I slept. So my husband and I looked at each other and we were like, we need more of these. How do we do that?
And so only then did we start researching and listening to podcasts, which back then there was only bigger pockets really, and learning about real estate investing. All right, guys, we got Avery here in Las Vegas. We're gonna talk Airbnbs today, right? Yeah, yeah, vacation rentals. I like to differentiate a little bit. Okay, yeah, there's a difference, right? I think so.
Yeah, because a lot of people list their stuff on Airbnb, but you specifically target vacation rentals. Yes, yes. So what we do is vacation rentals in true mature vacation markets. So beach markets, mountain markets, lake markets, things like that, not going into your grandmother's residential neighborhood and turning everything into party houses. Yeah, more competitive there too, right?
Yeah, yeah, it is. Yeah, Airbnb I heard. Well, there's that whole bus thing, right? Yeah, yeah, there was the whole bus thing. I'm happy to jump in straight in on that if you want. Yeah, for people that don't know what that is, could you explain that?
Yeah, yeah. So between 2020 and 2022, with interest rates going down to 2%, a lot of people bought real estate of all kinds, primary homes, second homes, investment properties, and short-term rentals were one of them because people heard, oh, 2%. I want a beach house. I've always wanted a beach house. I can make that mortgage payment.
Let me just slap it on Airbnb when I'm not using it and make money. Well, it turns out it is actually part hospitality business. So I kind of I like to call vacation rentals kind of a gateway drug to both owning a business, like being an entrepreneur, and also getting into investing in real estate. And so a lot of people did not treat it like the business that it was.
And then there was, I call them FOMO buyers, a lot of FOMO buyers who really wanted to get in. But in every asset class, there were thousands of offers on every single property. So a lot of people bought kind of weird stuff, like maybe they bought a little too far away from the attraction so that when the COVID travel boom kind of The tide went out on that.
They kind of got caught with their pants down because they're a little too far away from things and didn't really work. So a lot of people jumped in that didn't necessarily need to be there, realized, oh, hey, this actually is a little bit of work. Or, hey, I hate dealing with people because you do have to deal with people and then saying, OK, I think I'm going to sell this.
This isn't really what I want to do. But I actually read an article from AirDNA last week that a lot of the markets that they were talking about that did see saturation, so that saw a huge supply come on in 2021 and 22, have kind of the tides gone out on that too, on that big supply. So like something like 20% came on in a market like Joshua Tree, California in 2022. So a ton of supply.
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Chapter 2: Why do vacation rentals outperform traditional real estate?
Yeah. Certain cities, it just is, it's almost better to be in a Airbnb than a hotel, honestly.
Yeah. And I think that that's something that a lot of people don't realize that there's a time and place for both things. They try to make it a big, like we're going to, it's your hotel person or your Airbnb person in their adversarial, but they're really not. So for me, if I'm coming like here to Vegas for a a conference or podcast, I'm staying in a hotel.
I'm staying in a nice hotel on the strip. It's got room service and all the amenities. I don't have my kids with me. I'm going to relax. But if we're going to go on a ski trip or a beach trip, we're booking a vacation rental. So it's a different time and place. Yeah. So before Airbnb, you were in bartending, right?
Yeah, so I graduated undergrad in 2009, so no jobs for a soft communication major like myself. I was playing in bands, bartending to make ends meet during that.
Once the job market swung back around, I went back, got my master's, and got what I thought was my dream job, doing marketing on the business side of music in Nashville, and quickly learned that it wasn't, and kind of ended up in real estate investing, kind of looking for a way to have a Right. And I know you've said on other shows that bartending did more for you than a college degree.
Yeah. Especially being in the types of businesses that I'm in. So running the hospitality business of having short-term rentals. And we've got a lot of long-term rentals too. We've got 250 doors across the country.
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Chapter 3: What market trends are affecting vacation rentals?
Yeah. A little bit of everything. Yeah. Um, so are you still stocking up on places? Are you kind of just managing your current portfolio?
So we are always buying something. The market has changed. The real estate sales market has changed a lot in the past two years. There's not as much inventory coming on to buy because people don't want to take a hit. Everybody's been in this big waiting for rates to come down. Yeah, standstill.
Yeah. So nobody is really selling and then people aren't really buying because of the rates. So we've slowed down some, but we've always got we're always buying multifamily in the Midwest. We're always buying single family long terms in the southeast and we're always buying vacation rentals as they pop up. Typically, we'll be in the Smoky Mountains or somewhere in the panhandle of Florida.
But it's just easier now to not branch out into new markets because we've already got our systems built. It's easier to just plug a property in there. So always looking. That's kind of our main investment, like family business and then running the short term shop.
Yeah. Just looking for the right deals. You're patient, which is a good skill. A lot of people get into real estate. They want to just scale quick into multiple cities and then collapses once the interest rates go up.
Yeah, yeah. And we saw some of that even with our clients in 2022, people who, again, bought the, I got to build this huge portfolio really quickly. And you could then. I mean, I did it. I'm one of those people. But people were taking like $500,000 HELOCs. And not factoring that into the property they were buying. So they would take a $500,000 HELOC on their primary home, go buy a property.
And then they'd come to us later and say, hey, I'm not making money. Can you look at my stuff? And it's like, well, you have an entire other mortgage. $500,000 is no joke of a payment. And you didn't factor that into what the expenses are going to be on the property. So of course you're not making money. You've got this huge HELOC. So we did see people over leverage in that way.
The majority of people didn't. But I think that, you know, you got to be careful. You're trying to go too fast. Know your numbers, right? Right. Super important, no matter what level of business you're at. Yeah. Did you have a real estate mentor when you were starting out?
No. So we started buying vacation rentals in 2015. So back then, there weren't a thousand people on Instagram doing it. There weren't courses. There wasn't even AirDNA, like the main data source of what the income will be on Airbnb properties, started like the year after or the same year that we started. So we kind of came to it from a place of necessity. So we...
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