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June 21, 2022

From Pharmacist to 3 Million + in Annual AIRBNB Revenue (IN 3 YEARS) w/ Dr. Rachel Gainsbrugh

From Pharmacist to 3 Million + in Annual AIRBNB Revenue (IN 3 YEARS) w/ Dr. Rachel Gainsbrugh

Rachel Gainsbrugh had "The Golden Handcuffs".....until she realized she can make 256k per MONTH through only 10 AIRBNBS.

In today's show we follow the journey of Dr. Rachel Gainsbrugh, originally a practicing pharmacist who said "enough was enough" and began investing in luxury short term rentals. Through her concept of "less is more", Rachel's goal is 10k+ revenue PER PROPERTY / MONTH - and guess what? She's hitting it.

Today we cover a masterclass in short term rentals - what's working, what to avoid, and what's making the most money.

We cover shifting your identity from your profession to that of an "entrepreneur" and all of the emotions associated.

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Transcript
brian:

Rachel Gaines brew. . How are

rachel:

you? I am awesome. Brian, super excited to be here with you

brian:

today. We are representing from Atlanta, Georgia. Yes. All ATL. Nobody calls it hot Atlanta except for in the news or something like that. Except for in the news we actually call it Atlanta. So there's no T it's just ATL, a N a Atlanta. That's what it is. I'm so excited to have you on . You've been blowing up. I've seen you everywhere. I've had. Probably 20 mutual friends be like, Hey, you need to talk to Rachel. She needs to come on the show. And then all of a sudden you just start popping up. It's Hey guys, we got a zoom call with Rachel Gainsborough. Hey guys, we got another zoom call. And I was like, oh my God. Okay. I'm purposely not gonna be on those calls so that I can do this interview with her and hear everything for the first time. So here we are. I am very excited. And we have some topics to cover. We just talked off camera and off mic about some different directions that we want to go. So I will start it with, introduce yourself to the people. And let's start with your story because I think your story is the most powerful part of all this.

rachel:

Oh, thank you. And Brian, thank you so much for creating this platform and for taking the time to curate and put together such amazing content, especially for those of us who are looking to, exit. And so just watching your journey, just. Such an inspiration, you make it very tangible, you know? and so I just thank you for being personable and just putting it out there for the rest of us who are on the struggle bus looking for a way out. So thank you. Thank you.

brian:

Isn't it funny too? How income has nothing to do with it? It's incredible. It's weird. Isn't it? People think that maybe once they make that, maybe once they get up to that a hundred thousand mark, they'll be free.

rachel:

Yeah. And for others who think that once they get to the 200,000 mark, they'll be free. And so we're blessed enough to exceed that and we still didn't quite feel free. And it's incredible how one thing can with a snap of a finger and you're like, oh, I'm out. Yep. I'm

brian:

out. exactly. So let's talk about quitting. Rachel, let's talk about quitting.

rachel:

You wanna know about quitters quitting. Okay. Talk about quitting. So, And what I love about the community that we're in with go is that actually one of my gals who is a position who quit. Ever since I was a little girl, I wanted to be in medicine. I wanted to have that impact. So my personality, my entire, I think uh, neurotransmitters were like . I am Dr. Rachel. It's medicine and I'm a pharmacist by training and it's medicine, to think of quitting. I thought about what others would think a little bit, maybe 2% of the time, but it was really me. It was all in me, Ryan it's who. Who am I? Am I still a doctor? Rachel, am I still? And so that was the thing. And I kept making the excuse that it's the money, it's the money when I get to this level and I exceeded it, but then I had about a laundry list of other excuses and other reasons why, oh, insurance, that's a great one. The other one is oh, I'm making a few more capital moves, with purchasing property and. Wanting to leverage, those really cheap loans when you have a W2 . And so I had a great amount of excuses. There was so good. Brian, just really good excuses with my little golden handcuffs. And then, so my mantra this year was free in 23. I'm gonna be free in 23, 20 23 was. My freedom date, but then I started to speak with, my GoBundance gals and some other friends to walk me through this journey as I was seeking the great freedom. Yeah. And so we had a monthly guidance and schedule and we're gonna. Go and sit down, we're gonna go out into the nation. We're gonna cry. And we're gonna I had a whole like workflow of how I'm going to quit and developed it all in January and, had the plans because turns out it really wasn't the money. Of course, if you are in a position, you wanna look at your numbers and all of that cut back where you can, but it really wasn't like it was all this emotional work that I needed to do.

brian:

So I gotta PO I gotta pause you right there because the growth and I'm not gonna toot my own horn, but I'm going through a lot of emotional, spiritual stuff because you know what happens. And now I can offer perspective on this. Because now I'm a quitter, like I've left my W2 and Brian. Five months ago, you would've just said, oh yeah, we're gonna go sit out in the woods and cry once a month. I would've been like. That doesn't make any sense to me. I get it now. Because of the anxiety and the friction associated with changing your identity. Mm Woo. That hard let's keep hitting on that because especially in the medical profession. So I was a corporate sales. That was my thing. I am great at this. This is my this is my crowning, achievement. I was like, I'm the top guy. Yeah. And to go from that to, okay. It's just me now. There's no one else that's gonna applaud you. You're not gonna get the awards, the trophies. It's just you now. And if you fail, it's all on. You talk about that a little bit because the emotions that come with it, nobody talks about this, but it's a

rachel:

transition. It is a transition. and there's a guilt associated, , I'm a little girl from Haiti who was raised in the inner city of Miami mom and dad. They, sacrificed, they sacrificed for me to be here, to go to school, to go to school, to be in this country, this great, amazing country, for better or for worse, it's not perfect, but this is the great, country. This is a phenomenal country sacrificed me to get here. I was born there, got here, excelled in academia. Am I taking their sacrifices in pain. So all the voices in my head, so my identity, then this guilt trip, and these are all conversations I'm having with myself. And so I had this mapped out for the whole year where that journey was gonna take me. And then finally at the end of the year, I would put in my resignation letter at the end of 2022, and I would quit well. Healthcare burnout is so real Brian. And sometimes when you're in that, what is it called? Analogy like the boiling

brian:

pot or whatever. Oh, the frog and the pot. Yeah. Where, how do you kill it? How do you cook a frog? You boil it slow and it doesn't even notice that it's cooking.

rachel:

That part right there. that is the part . And I was that frog. And then one day, no, we were already really struggling. Overworked, understaffed, just hit more metrics, but. Our quality of life was depreciating. And what was great about starting with short term rentals and starting investing the income was coming in. I, I just wasn't really all that into overworking for less pay and, putting others' help at risk . And whenever someone would be called in to do more with less, I would. Really, I don't think she should do that. I started to speak up. Yeah. And there's a power that comes with you, not relying on a W2 who for your whole existence. Right? . And so I started to speak up and then one day I received an email stating that these are the new initiatives we are going to put forth. And and there are a few other things that I just didn't agree with in February. Remember I had all the way till December. Of 2022 life's didn't work like that. Life doesn't work that way. February 20, 22, got that email. I didn't make it two months into the year. And I said, peace, peace out. I'm out. And all of that identity angst, all of that, just went by the wayside because ultimately, if you really wanted to Brian, could you not go back to somewhere in corporate and say, Hey. I'm gonna apply for a job again, you know, I'm like, if you really wanted to, you could always do there. Yeah.

brian:

Oh my God. Yes. Thank you for saying that. Everyone's got such a huge fear. About making the big leap, right? Like gay Hendricks, big leap and everyone's so afraid of it. And my girlfriend even. So we're about to go travel and do all this stuff. And everyone thinks that, obviously that's the coolest thing ever. Like why would there be any anxiety or fear or scarcity associated with that? And, it's a transition and we're leaving everything that we know and find comfort in. And I told my girlfriend, I said, Bella, Hey, what is the worst case scenario? Like we come home and get jobs yeah. High paying jobs. What are we doing right now? So our worst case scenario is literally our present day reality, right?

rachel:

Baseline. It's yeah, exactly. So there's nothing to fear and I just want to give the audience permission to dream, Permission to step out on a limb permission to know that it's gonna be okay. And I had wish I understood that earlier on because I would've left a little bit sooner or even cut back a little bit sooner to the point where I didn't start to really hate the day to day.

brian:

I love that. You're familiar with Jason, right? Jason drew. Yeah. Like they've seen you in that community. Yeah. Yep. He said something that was super interesting to me. And I've adopted it to where he talks about how. You have a graph on the Y axis, the vertical access is growth of the X axis is time . And so people normally will grow slowly, gradually over time, maybe two to 5%, they grow, and it's a slow transition as you transition. But as you grow, there are also problems that come with success, but people are Handl them at bite size chunks. And then, so he said, whenever you in success, all of a sudden you have. 10 years worth of success in two months, but then you also have to integrate 10 years worth of problems. Yeah. That's where we're at right now. so how's your integration

rachel:

going? It's interesting. My new boss, she's tough. . brian: She's pointed at her. She points to self . Man. When you were describing your calendar a little bit, I was like, yeah, that sounds about right. Yeah. How can get roped up roped into back to back to back calls like this, yeah. But it's exciting because first of all, what I'm finding is that I'm able to be more creative. The creativity is coming out. The ability to, to just explore and create things without feeling completely depleted and wiped out by the end of the day. So that part is great. I am struggling with calendar management and okay. Using the word. No, learning to say no, and that's all on me. And so what I've done is I've actually hired several people onto my team. I do have a new EA and so she's helping me manage certain projects. But ultimately she will be managing my calendar. And so we're coming up with SOPs right now for my calendar. I told, believe it or not, I always need a lunch time at this time. I need breaks in between. And I feel as though someone who's unemotional about things can plug and chug that, everyone knows talk to Ashley. If you need to get on Rachel's calendar, talk to Ashley. Rachel will overbook herself. I've got meetings overlapping. It's a hot mess. It's yeah, I think I can make this happen. I think, but if it's someone else looking in, they could be a little bit more judicious with that. And so that's one thing that I'm working on as well. But I was running a small coaching practice for those who are looking to get started with short term rentals and within two months of quitting, I've generated over. I wanna say 10 X, what I was able to generate last year when I started. No.

brian:

Yeah. Oh my gosh, within two months. Yeah. All right. We'll use that as our hook. We'll use that as our hook right now, first off. But before we do that question, your EA, is that a domestic EA or is that a virtual assistant?

rachel:

Yeah, she, interestingly enough virtual as, and she doesn't come to my office every day. Sure. Sure. But she lives in Georgia. also like us, which is great. Yeah. So she's here in the.

brian:

Cool. Yeah, I've got one right now. That's working from, I think Turkey or something. Oh, nice. Yeah. So it's a transition that, that's another thing that people don't really talk about is they say, yeah, just SOP it out and then you have to be like, okay, now I need to transition to the identity of someone that has SOPs. Huh? Okay. How do I systematize my life when you've never thought about that before? Yeah. And that's another sticky situation where you're like, okay, What is my time best spent on . That's a rough one. What interest if you coming up with there.

rachel:

Okay. You want me? You want me to be truthful, right? Hair appointment at that part? That part look, if my self love is not on fleet, I'm not showing up the way. I'm just. Jim. I bet. No for me, no guests have ever told you that before. So I'm telling you today if my hair and my nails are not what, where they need to be. I am not showing up in the way that

brian:

I need to show self love and that's Hey, that's for everyone. That's the gym for me. I make sure after this, I have an hour blocked off, cuz I need to get my gym in yep. It's something for everyone,

rachel:

That's a part of it too. I need that carved out and I need to prioritize it because it's one of the first things that, that I will let go. It's one of the first things that I will let go, because for me, that's, there's flexibility there, but No, don't let that go because once you've done that part, you feel a certain way, and there's nothing like feeling confident and ready to conquer the day And so that's a part of it too. So part of it is that self love. How do I need to show up as the CEO of my small, but mighty business? And part of it is health. My health it's having those lunch hours carved out. We're not quite there yet. We don't have all of that in place yet, but really getting strict about that calendar so that I can be the most productive that I can be. And I read in an article a couple weeks ago, after 25 hours per week, your productivity reduces . So the first, map that out. Work your pants off for 25 hours, but the rest of the week, it's probably, you're probably not really moving the needle the way you think you are.

brian:

Yeah. Are you like mean to where now you find yourself working after you've left your w two after you've left your profession, do you find yourself

working from 6:00 AM till 9:

00 PM? Like me? Yeah. Uhhuh. Yeah. And it's you don't doesn't feel like work if fires you up and it's super. . Yeah, but there's a guilt associated with taking time for yourself where you're like, okay, this is all on me now. I'm our work ethics got us to where we were before with our vertical income, which is what we call corporate income. That's our work ethic. And now you're like, whenever I stop working, I feel guilty. Do you have any advice on. It's rough.

rachel:

It is. It is. And I wish I had the answer to that, but again, it's going in with a plan and creating those SOPs, and outsourcing there's more to life than. The grind, there's more Sali than working. There's more. And then again, the productivity, because if I'm working that late, am I really giving you should see the spelling errors that happen after a certain number hour during the day, it's gotta be a spelling errors, the posts that go out and it's a hot mess. It's huh? . So if that doesn't tell you, maybe you should. You're doing too much. You're doing great. I say, girl, you are doing too much. and

brian:

that's what it is. So it's, let's speak on that. So instead of doing too much, let's talk about less is more because that is your mantra. That's your guiding light and your business, and we'll get into your business here. The Airbnbs, the real estate talk about less is more.

rachel:

Absolutely. And I wish I came at this Approach from a philosophical there intelligent, me and Socrates were talking, no, it was a mama with a whole husband, two kids, and three dogs trying to figure out how to make those dollars stretch and still perform. And so after doing all of the digging, all of the research, looking at every single real estate approach that was available to me at the time, Because really I wanted to invest, but I couldn't figure out which vehicle to use. I landed on real estate Bitcoin and all that stuff. I didn't quite understand NFT. So I landed on real estate in 2019, and I did the analysis. And when I looked at the time that was associated with. Different aspects of investing and then the revenue that was produced with different aspects of investing for me at the time wholesaling, which is, easy to get into easy, and you're gonna start making all these check I was after, really digging in. I was like, no, that's 80 hours a week. That's another job.

brian:

He got no

rachel:

assets. Fix. And so obviously, let me do. Best thing. That's not gonna take a lot of time, I'm watching AGT in 30 minutes, I've got a $40,000 check, right? They, yeah, no, that's not real realistic. Short term rentals. Was it for me specifically luxury shortterm rentals and what I found there that the gross ROI on luxury short term rentals far exceeded by and hold long term rentals far exceeded any other real estate strategy. That I was looking at the time, really anywhere from three X to 15 X is what I had projected the gross monthly revenue would be. And so I went with short term rentals and I quickly identified all you needed was one or two to just be outrageously profitable. If you are doing the analysis correctly,

brian:

Talk about. Talk about looking at cash flow, which your clarity is Al already. A huge thing. People will talk about, what's your crystal clear criteria like brain Turner would say. And then, so you're already crystal clear about what you want your cash flow to be, right? Because you're like, Hey, I gotta replace this doctor income, which is substantial. And so your goal is purely cash flow. So talk about your ideas of less and more as opposed to just like door count because you and I were talking about that and. It's a vanity metric at the end of the day. Me and my friend, me and my buddy were talking and we were like, Hey, really, if we just had 10 to 20 houses, single family homes paid off by the time we're 50, like that would really do it. Yeah. That'd bring in like a quarter million dollars, $300,000. Absolutely. Absolutely. A year. Yeah. So talk about that a little bit. And coming up with that kind of change in your frame.

rachel:

What's interesting about short term rentals. And I was looking at it from the approach of say, I would cash flow 10 K per month. On a a luxury property or a larger single family home in a great suburban area. And so that's really what my goal was about 10 K per. Okay. Mm-hmm On these properties and whenever I would put in an offer or put one under contract, that would be what I was aiming for per property per property. Correct. All right.

brian:

Listen to that. People stop telling me about your grand mission to get $10,000 in. Cash flow. And you're getting like 900 units to get $10,000. She's doing it per property. Continue. Rachel.

rachel:

Thank you. yeah. Yeah. You're welcome. Yeah, come back to me if you're multitasking guys, cuz this is it right here. And so the first one we purchased was back in 2019. It was a single family home, four bedrooms really? Area in Georgia in my own backyard, there was a whole story behind that, that one we started off, it was generating about $8,000 per month gross. And there were expenses. I didn't quite hit the 10 K mark, but I already felt like we were winning because Long term rent in that area was about, I wanna say $1,500 a month. Our mortgage was $1,200 a month. So already we were wait. The next property was not too far away from that property. And so we purchased this next property and that property did I say it was 290 K not table.

brian:

Okay. When you're saying luxury properties. Yeah. I was about to ask that cause with a $1,200 mortgage, I was like, in my mind, when you said luxury properties, I'm thinking about you buying like some three stories, Savannah townhouse.

rachel:

Yeah. And it could be that too, but where my bread and butter lies is five to eight bedrooms. Okay. The bigger homes. I love those. And I'll tell you why in a moment. So the next home was a six bedroom home. We bought that one for 460. So we, really did an uptick there. I was projecting hitting my 10 K per month and then more, but here's the story and this is, I think the story's actually my claim to fame. It's the one that got us on Netflix. This home. Once I set it up on the platform, I added the dynamic pricing tool to it. Again, a little girl from Haiti, I was thinking to myself, you know what, I wonder if it will make, 8,000 or 9,000 or 10,000 a month because I was gonna put it on a monthly program. There's those first couple of months as I onboarded my new cleaning. I turned on the dynamic pricing tool. Uh, I use a tool called price labs and it's it has artificial intelligence, all of that in there where it's evaluating the neighborhood occupancy in hotels, short term rentals, all that good stuff. And then you have to train it though, right? the first couple of days you're training it, it starts out it'll either overshoot, outrageously, or undershoot outrageously. And so you need to know where your baseline is gonna be so that you can set it up correctly. So I set it up and of course it overshot outrageously. I was laughing. I was like, oh my gosh, $28,000 for 39th. That's insane. So let me turn it off and start training it before I turn it off. It got booked. What it got booked for $28,000 for 30 nights. The next month it got booked for 15,000 for 30 nights. The next month it got booked for 22,000. For 20 nights. It's been averaging about 21,000 per month. How

brian:

okay. And this is the which property is this? Is this the 212 or the 4 62. Okay. 4 62. What area

rachel:

is this? Petree city. Petree city. Okay. Haven't even touched the Poconos and Rosemary beach yet. All you need is a one or two, Brian.

brian:

Okay. So talk to me about this cause what all right. So talk to me about your strategy. So you have a four to six bedroom.

rachel:

No. Okay. Five that the first one I sold it and we went bigger. So five to eight bedroom. And the reason I five to eight, the five to eight bedrooms, Brian is because I get to host multi-generational, multi-families traveling with children and pets. That's my avatar. And imagine this, you, your girlfriend, your families, all you have about four or. Paying adult units that I can host. So I feel comfortable charging a nightly rate of anywhere from nine. I wanna say 800 to 2,800 per night is what we charge at our properties because we have large families with. Adults who are gonna be paying. Yeah. So for you, it's still a good deal because you're not in a hotel, you're in a big old house and you're together. Game room, pool, fire pit. And for me, it's fabulous. Again, a little girl from Haiti I'm like who would ever pay 28,000. So when that happened, my whole life was blown wide open.

brian:

And this is so you specifically rent them monthly.

rachel:

Not NEC no, not necessarily. So that one, if it's rented for monthly, we have individuals who are coming in for the filming industry. The first guest was actually the executive director of a major TV show. I cannot disclose, but executive director was the first one, but guess what? The subsequent ones were actually insurance companies, honestly, all state insurance. They were placing families in our units, progressive insurance, placing families in our units, either their home caught on fire or their home. There was a flood and so they would place them in there anywhere from 30 days to three months to I had one stay for 12 months paying those rates.

brian:

Is there any kind of proactive work that you're doing to get in touch with these insurance companies or anything? Now I am yeah, I was about to say so

rachel:

now I am. Okay. Of course.

brian:

Okay. So first off let's describe the property. Let's get the mental image here. So I'm visualizing it as something nice, but it's I'm still trying to wrap my head around somebody paying like 15 to 20, $28,000. Yeah. So what are you looking for aesthetically? So we're looking for the five day bedrooms for the family. Multi-generational that's your avatar? What specific areas? What are you looking for in your areas that you're buying in? What's your buy box for region and for the aesthetic of the property?

rachel:

So for me, the properties aesthetic on the exterior has to have some kind of curb appeal. It doesn't have to be perfect. Okay. But more importantly, not that particular property, the whole neighborhood has to have some kind of curb appeal. Otherwise I cannot market it as a luxury property because understand this modern luxury is not the accumulation of things. We don't need a big old grandiose fountain in the front. Modern luxury. Individuals who want to reconnect with nature who wanna reconnect with one another who want a convenient great communication, curated stay. They wanna live like a local. Yes. I have organic honey sticks that are local brought in for them. Yes. I will provide a charco board. So these are things that. Yeah, you can do that, but it's not that these homes are 800,000. What they are worth 800 to 1.7 million, but going in that was not my purchase price. So my buy box right now is larger homes, five bedrooms plus in a community with great curb appeal, if it's gonna be in a suburban area, but if I'm gonna be in a mountain. Or a lake or a beach region doesn't necessarily have to be in a community with great schools or anything like that. And so I'm looking for spacious areas in the backyard. If I can manage that because I can go in and add in my fire pit, add in my outdoor fireplace in the mountain regions, I do want a pool and a hot tub if possible. If it's not both possible, I do want a space for a hot tub in the beach areas. I'm looking for a place that I can add a pool or a place that has a pool. Those are pretty much my buy boxes, but for me, it's my budget, right? If I say, okay, my budget for this next acquisition is 600,000. For instance, then I go into my data and I'm huge on data. I look all over the us. I Don. Focus too much on the far west , because I wanna be able to get there within five hours if I have to. And I haven't had to but I like the east, the Northeast and Southeast area. I do some middle America areas, but I'm looking for somewhere that if I can get a lake view, that's great. If not that's okay. Because when I create the stay of the home, when I design. The home is the thing, I just have a student purchase, a 13 bedroom home in Orlando that you know, that home, once we're done decking it out, that is gonna be the attraction. Yes, they can go to Disney, but we're gonna create that. Know, whole stay to continue. It's gonna be Disney and continuation in the home. And so the home is the thing and that's where I think a lot of people make mistakes with short term rentals. They're just putting on grandma sofa. Don't try me with grandma sofa. We need to create

brian:

an experience.

rachel:

Yeah. Create a whole experience. Yeah.

brian:

What, so is this a niche on Airbnb? I'm thinking about it. Is this a niche that's like kind of underserved? Is that larger?

rachel:

I think after COVID, after, some of the travel restrictions were lifted, it definitely is a niche that's underserved. I think that being pet friendly is also a niche. That's underserved. Cuz I was in pet friendly. I'm like I'm luxury. I'm not gonna be pet friendly. I've got my own dogs. They don't get to go to my rentals. I got my own dogs. I don't let them into the rentals. So I was not going to be pet friendly, but. We kept getting asked, after the eighth person asked you, could I please bring fufu with me? I said, okay, wait a minute. This is a lot. So I called the different boarding facilities in the area. And when I got the price point to board fufu for 30 days, it was on added on. Okay. Absolutely. And not a hundred percent, but like maybe added on a 50%, for the pet. And so speaking to my revenue manager, he's he will tell you, I do have someone who. I reach out to, I was like, could you look at this in like a consultant? He says, my properties are at the top, like 99th percentile above everyone else. Cuz I'm able to peacock. I don't compete. People are competing by price with so and so do I don't compete by price. I add so much freaking value and my properties that once you see it, you said, okay, I'm gonna go there because she's got me covered. You don't have to guess. I got you.

brian:

Okay. all right. So I'm mind blown right now. So talk about some of the strategies that you're using to provide value, to make your listings irresistible in comparison to the other ones.

rachel:

Photos. Tell the story. Okay. If I can't get you to click on my photo, I've already lost. Okay. Photos tell the story. So professional photos are it. And when I look in my markets and I'm scrolling up and down or left and right to see. What kind of properties are in this market? My needs to stand out from the fray, whatever it takes. The first one may be the most glorious swimming pool while everyone has like a blue hint photo with the pool. I'm gonna, I'm gonna peacock. I may do a hot tub and make the scar the sky a little bit Misty, because I need you to see something different so that you. Tap on my listing. So photos tell the story then in my copy, the copywriting, , that's the second part. I'm very specific about my copywriting. It has to feel welcoming and it has to give a call to action. Personally, people need to be told what to do. Other, I read other people's copy. I do it for a living and it's three bedroom, two bad, this a real

brian:

estate rental boiler plate. Yeah. Very boiler plate. Yeah. BA

rachel:

boy, mine is, come stay with me book here so I can take care of you book here. Like wow. Amongst all of the amenities, we have luxury this, we. Your mattress. I even described the mattress. If I went all out on it, if my linens are Brook linen, you better believe you're gonna read that in the welcome copy message. Come and enjoy some soft Brook linens and kick your feet up on such and such, restoration hardware. So like really give them. A picture of a story and a journey. A readability is huge as well. Like I'm not, you're not gonna see paragraphs upon paragraphs in there. , it's gonna be bullet, bullet, a little paragraph, bullet. So all of that. Is the intro, right? To the property. And as soon as they inquire that communication is everything, it needs to be timely. It needs to be um, attentive. It needs to be the responses need to make sense. I know a lot of people automate and we have some things that are automated, but we have to communicate with the guests. We have to set the tone. Of what that trip is about and make sure that we're taken care of. And we pick up the phone sometimes to, to talk to them, just make sure that we can serve them and serve

brian:

them well, but you can do that with the fewer amount of properties. If you have 20 properties, you can't do that. But if you have three, like you can do that. That's not that much of a time commitment. So you've. Two of these. How many of these do you have

rachel:

now? We're up to 18 because we actually expanded partially with a partnership. Okay. We purchased a few more. We went into a partnership and then we're actually helping some homeowners who wanna get in, but they're not quite there yet. Say, guests are responding. They're. Doing a surgery or, performing some type of procedure. So we do co-hosting for certain homeowners, but we only select and enroll properties that meet our avatar in our program just because it's streamlined that way.

brian:

Okay. So what is this? So you've got 18 now. What's this cashflow looking.

rachel:

I was doing analysis in July of last year, cuz we're doing our projections for this year. 10 properties are in the Poconos. They made 256 K

brian:

in July

rachel:

one month. She got this smile. I can't try to tell people, they're not, no, you're listening. They're not

brian:

listening. So obviously it's like seasonal and it waxes and wanes, but I mean, even if you call it like six

rachel:

figure months, period,

brian:

six figure. Yeah. I was about to say, even if you call it. 200,000 month. That's 2.4 million

rachel:

we made 3.1. I wanna say in when we closed our books last year

brian:

off of 18 properties. Yes.

rachel:

Okay. Price points were 1 75 K to. 4 95 K. But those prices aren't available today, but that's for sure. 20 purchased around 2018 through 21. And this is,

brian:

yeah. So this is three years. Yes. Three years, 3.2 million.

rachel:

Top of line.

brian:

There we go. There's the podcast title. okay. So let's play devil's advocate to finish this out. So I cuz in this show I want to be able to like just absolutely decimate, any reason anybody would say anything. So let's play devil's advocate. All right. Rachel sounds great. That's great for you. Fantastic. Today's market's not like that anymore. And the prices are super overinflated. Airbnb is way more saturated. We got HOAs screaming at us. Atlanta's cracking down on Airbnbs and the economy is going to shit. What do you say about that? Rachel? You think that you can make your $3.2 million on me? What do you say to that?

rachel:

Okay. Bryan, I know this guy is falling and. And, you know what? I love that because that's all I hear all day, that's all

brian:

I hear is especially in the luxury

rachel:

market. Yeah, absolutely. Absolutely. And so what you need to look at is how do you reposition yourself in an economy where there, there are changes. And so I never anticipated doing a cohosting model. I never anticipated doing arbitrage. We have two that are arbitrage where we're renting to rent. And so that's an approach. Can you pivot when times have changed, right? You have to be able to pivot. If you are say you're an investor and you don't know how to pivot, you're not gonna last for long. You have to be able to pivot. Multiple exit strategies, multiple well, multiple exit strategies as well as different investment approaches. So I say I'm a Georgia girl. I'm just gonna invest in Georgia. Say Georgia properties may not be in my budget. I'm gonna look at the whole us. I'm putting in offers. In Texas, I'm putting in offers in Western North Carolina. I am going to look at the hot markets where I know I can generate the revenue and say that particular property there is in a, at a price point. I'm not quite comfortable with. I'm going to go to two neighborhoods over and see what I can do there. You can always leverage the fact that you're in the vicinity of the smokes of blue Ridge you're in the vicinity . But if you can curate a state at that property, they don't care that it's, 30 minutes away. You make sure you have full disclosure, you make sure you're well stocked. You can go outside of that area and close on a property. That's $230,000. Like my student just did a couple of weeks ago. That's in the blue Ridge area that is going to generate her fabulous cash flow. Okay. So secondary tertiary markets expand your reach, expand your markets. Expand your mind. Zig, you know what, everyone's zing you Z you go a little bit further out. You're going to find something. And so understand the numbers. Saturation is actually an economic term saturation means, and I'm not an economist. I'm not a financial advisor, but generally speaking, it means, yes, you have an increased volume of the product and then the price is going down. But what I'm seeing is demand. There is an increased volume of product, but my prices are going up. Boo. They're going up. You need to stand out for the crowd so that you can continue to peacock above the crowd. Don't do what everyone else is doing. What value can you offer? What value proposition can you add to your space? Can you connect with a local, small business? Who's a private chef and just add them on there and say, Hey, we also. Provide private chef services, that person, God getting in, you can have a meal and, you can split the charge with them, add a little bit more into the nightly rate. If they want the private chef, can you provide a driver to grab them from the airport, and provide a little bit more guys. So they're not thinking about that. Can you provide a car service? Some people can. Think about those things. How do you add more value? What is it that this avatar is looking for? Is it on a lake? Can you add kayaks? Can you add, a paddle board? What can you do to make yourself stand out from the crowd?

brian:

And so it's almost like the Alex hormo. Like a hundred million offer strategy where you're like, Hey, like we're not battling on price. We're battling on value gear. Like absolutely. We're trying to, oh my God, no

rachel:

competition, Brian. I kid you not, I have no competition

brian:

bring it. Alright, so I've got two questions which try to do a rapid fire here just for the sake of time. Yeah. So one question is, I'm curious about your Your capital allocation right now. So if you're making and I'm just going off an assumption here this is just where my mind goes. Tell me if I'm completely wrong or what you're doing, but like my mind goes, okay, cool. So now we're flirting in an area to where. The economic forecast, isn't looking like that. Fantastic. And you're making that type of top line revenue. Are you reinvesting when you're doing this? Are you still highly leveraging in scale, put as little percent down or are you starting to pay off some of the equity of some of the properties just to have a little bit of cushion? Does that make sense?

rachel:

It does make sense. So actually what I'm doing is repositioning my property. So if I have a property that I felt didn't quite perform the way I needed it to perform or hasn't been performing. And the reason is if you have older homes with short term rentals, Newer is better. I mean, if you, or if you could renovate, that's gonna be better. And so I'm looking at that. I have actually offloaded we're at 22, we offloaded some properties. We're building up a nest egg and we are actually building on the beach and sending the capital there towards the beach. I don't have a strategy right now to pay down debt. I'm getting into. I'm buying more property right now. And the way I see it, especially with my runway I think I have a longer runway. I hope I do with my runway. What I'm seeing is that my guests, they're more than ever paying for, the expenses of the property. I would say there's about. 35 to 40% of the revenue that goes back into the property, whether it's for the debt service, whether it's to replenish things, to make some improvements. And of course, to take care of my team, my cleaners, I do have a maintenance person that sticks around with us. And I have virtual assistance that help with the communication side of things. So I don't communicate with my guests anymore every now and then I'll pop in, but I have the virtual assistance. Those are typically. I think they're all. Yeah. They're all in Vietnam. Actually. Those

brian:

70%. That's a 70% profit margin. Yeah. Oh my God. Okay. So you're just operating at a freaking bananas level okay, this is awesome. I'm running out of time. So I can't ask you all the questions. We'll maybe do a part two in the future. What do people get wrong? A lot of people get into Airbnb. A lot of people are like, oh, racial, this sounds great. I'm trying to get into Airbnb. It's 20% pero law, right? 20% make 80% of the money. What did the 80% get wrong? How, because how there's a lot of people that crash and burn an Airbnb, what are some mistakes that people make that you can say to avoid for maybe somebody that's okay, I love what Rachel's saying. I wanna jump in. What can they avoid? I

rachel:

think the first thing that they get wrong and there, there are different things to get wrong along the way, but not really analyzing the deal before going in, not really understanding the numbers, not really understanding the market, just going off of assumptions of what others told you that you can possibly make. You have to understand your own numbers. This is where. I don't want you outsourcing this. This part is the most important, the buy and a lot of them yeah. Understanding the analysis because, and then they come to me to try to fix something that's completely broken. And one big part of the analysis. What is the occupancy rate of this market? Are there travelers coming to this market and there's a free exercise that I do on, my Facebook lives is plug this address in here, add the bedrooms, add the bathrooms, add the number of guests, and you will get a number that spits out that tells you a percentage. And if it's under 50%, we do not invest there. That's called high risk. It has to be 50%. Or higher for the occupancy rate. That part, that's where we start. And then I go in and I granularly Ana analyze more and more. And then I pay for data into, different tools to analyze more and more because when I'm putting money on the table, I'm going to pay to get more data, to make sure I'm doing what I need to do. . And once I identified a market and I say, okay, this is a great market. This is, my, my buy box. I can just Rente and repeat that process, but. If you come to me and you just purchase a home and I plug it into the tools, the free tools that are out there, and it tells me a 27% occupancy rate. My suggestion to you is let's figure out how we can sell it, cuz no, boo. It is not, it's not gonna work out. And that's where I see a lot of people. They come to me by the time they're like, we're not getting bookings. There are no travelers to this particular region.

brian:

Okay, that makes sense. So next question for time's sake. What's next? What's your vivid vision? What, where are you taking this in three to five years?

rachel:

Ooh, I love it. So I am more than content with the size of the portfolio. Sure. I think we're going to continue to reposition and look at how to continue to be profitable. We wanna own less and make more, just saying that's where I'm at pruning down the ones that aren't doing great, adding more that are doing phenomenally and teaching others to do it. Because although we did have rapid growth, thanks to, collaborating with GoBundance folks and we were able to grow rapidly, but I want the message for everyone who's listening to be less is more. all you need is one or two, really? Especially if you have a W2, once, you kick it through the curve. Yeah. Continue to grow. But I don't want the overwhelm and the paralysis to come in because it is work. It is not passive income. It's not passive investing. It is active.

brian:

so's we need to cut that. Cause I talked to so many people on this show and this is literally my entire life now. So it's like the goal was to do what you want when you want with who you want. So it's just. Lifestyle design is as important as cash flow when it comes to all of this. Absolutely. So now we've got everything designed up and it's just, it's. It's cool. It's cool to watch. Like I love seeing all of this and there's just so many different ways to go about this. Cuz think about how much mental space this takes up for people that they're like, oh, I need to make this much. And it's always 10, it's always $10,000. That's where everyone starts at instead say I wanna make $10,000 to do what? Yeah. What does your life look like? Now that you have that coming in, do you want to scale? Do you wanna grow? Do you wanna travel? Do you wanna spend more time with your kids? What do you want? Yeah, so that's very interesting. So where could people find you? Where could people reach out to you with all of the 10,000 questions that are

rachel:

gonna have. Oh, I love it. You know what? Download my free gift. I have a gift called 75 gems.com. If you go there, go to 75 gms.com. You're gonna get my free top us cities with the highest profitability. I'm a spreadsheet girl, it's gonna be a spreadsheet. It's not gonna be cute. It's gonna be a spreadsheet with a little video to show you how to use it. This is my list for 2022. And whenever I'm in acquisitions mode, I refer back to that list because, it's a list that I curated with data minors and we put it together because that was the top question that I kept getting asked. If my city then pickings wrong, but so where should I invest? Major woods, city . And that's how. I gave birth to that back in 2021. And now I released 20, 22 not too long ago. So check that out on 75 gems.com and then you'll get redirected. At the end, you'll see my little Facebook group. We can connect there and just message me I'm on Facebook. I'm on instant LinkedIn. Yep.

brian:

I love it. I love it. That's a heck of an offer. So everyone would go to 75 gems. So like literally seven, five gems, seven

rachel:

com five gms.com. Yeah. Perfect. And

brian:

then we will have that in the show description and we will have all of this linked in the action academy newsletter of course, because all of you need to subscribe to that and go get your free. Excel tracker for these top Airbnbs, because now if you're listening to this, you've gotten a lot of value today. Yeah. You've got a lot of value today. So Rachel, I appreciate it. We're definitely gonna have to have multiple shows down the path, but I love your philosophies here. I love how you're going about this. I love your mindset about this because we need to keep pushing the narrative that you don't have to just get $200 per door. Oh, no, that does not exist anymore. And then also even with this podcast, I'm like, Hey, let's put everything online. Yeah. And you can print out, like you would be shocked at what this show produces. So I'm just saying, find out whatever you're passionate about for Rachel. She was like, Hey, short term rentals. This is my thing. Luxury short term rentals. Now she pops it out. Now all of a sudden it's another revenue stream. What are you passionate about? Putting it online. Go make it your money. Get outta that job. You hate. I love this, Rachel. Thank you so much. Thank you, Brian. All right. This has been Rachel and Brian with the action academy podcast. Signing off sign.