What is a Hostel? And How Are They Different Than Short-Term Rentals?

Today’s expert guests are the owner/operators of Howzit Hostels, a growing brand of hostels based in the Hawaiian Islands. Michael and Nathan discuss their journey beginning with investing in short-term rentals to scaling up to commercial and hospitality properties. They currently own two hostels, one in Maui and the other on the Big Island of Hawaii, with a combined bed count of approximately 140 beds. 

Within only 3 years of opening, Howzit Hostels won the 2024 award for #1 Small Hostel in North America. Current annual gross revenues from their hostel business are expected to exceed $2.75 million. Their goal is to grow to 400 beds within the Hawaiian Islands and 4,000 beds in North America.

Michael and Nathan explain why hostels are not only an excellent investment but a feel-good business that brings people together to share incredible experiences.

(00:01:34) STRShare: @the_avian_lakearrowhead

• Drone footage for the win 
• Deck inspo! Great outdoor areas 
• Offering a guitar for guests to play

(00:02:57) Introducing Mike and Nate of Howzit Hostels

• The source of great partnerships
• Business benefits to an alignment of goals and values
• Early days of short-term rentals in Hawaii 
• How they landed on hostels 

(00:16:54) Hostel vs. Short-Term Rental vs. Hotel

• Leaning into guest experience and design 
• Curing a shared experience for younger demographic
• What’s the bed/bath count?
• Business requires a volume of travelers 
• Important safety and security notes 
• Delivering Happiness by Tony Hsieh 
• Do/can they list on Airbnb?
• Check out Hostelworld OTA 

(00:36:02) What’s it Like to Manage a Hostel?

• Being in the community building business 
• Concept of elevated reciprocity 
• How do they manage cleanliness? 
• Full-time housekeeping manager
• Building detailed processes for accountability
• Mike and Nate share a gut punch review 
• The time a storm took out their plumbing 

(00:47:23) Running the Numbers on Hostel Management

• $200,000 a month in revenue
• 35% net operating income 
• Licensed as a hotel 
• What are the age and family dynamics?

Download a transcript of this episode.

Resources:

• Instagram: @howzithostels 
• Book a Hostel: howzithostels.com 
• Investment Website: vortexmaui.com 
• Investment Instgram: @mikeandnate_thehostelguys 
• Swell Vacation Rentals: swellvacationrentals.com 
• Video: How to Clean Your Airbnb – A Walkthrough for New Airbnb Hosts 
• Submit your property for our next STRShare at STRShare.com
• Airbnb Essentials Checklist: hostchecklist.com

#STRShareSunday

@the_avian_lakearrowhead

The Avian at Lake Arrowhead is a meticulously designed rental, where every detail is crafted with intention and purpose. Their stunning photography captures the charm of the space, highlighting small moments like the availability of a guitar for guests to play. A record player with vinyl records adds a nostalgic touch, creating a unique and inviting atmosphere. 

The incredible drone footage showcases the property’s beauty from above, while consistent branding ties everything together seamlessly. In a creative effort to grow their Instagram presence, The Avian partnered with their Lake Arrowhead community to offer a generous giveaway of a three-week midweek stay, fostering a strong connection with their audience and community.

• Instagram: @the_avian_lakearrowhead 
• Airbnb: Secluded A-Frame, Fire Place, 2 Outdoor fire-pits

We would love to feature YOU, so don’t forget to use #STRShareSunday to get your chance!