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436. Hosting Hotline: Which STR Upgrades Actually Increase Bookings?

Welcome to the Hosting Hotline

Sarah Karakaian: [00:00:00] [00:01:00] Hello, welcome back to another great episode. My name is Sarah Karakaian.

Annette Grant: I’m Annette Grant, and together we are

Sarah Karakaian: Thanks for Visiting, and this is the Hosting Hotline. If you’d like to get your hosting questions answered here on the Hosting Hotline, all you have to do is go to hostinghotline. com, ask your question, and we’ll answer it here on our Tuesday episodes, the Hosting Hotline.

Listener Question: Investing in Privacy Fencing

Sarah Karakaian: Today we’ve got a great question from Bree.

Hosting Hotline Caller: Hi ladies, I am so excited for your upcoming boot camp and I have a question around how do I know when it’s actually lucrative to invest in privacy fencing and creating kind of a compound feeling. I live in a mixed industrial residential area that’s not super pretty and a few guests lately have mentioned they don’t feel super safe in the neighborhood, but they love the property itself.

self and I am getting solid five star reviews, but I did hear in a recent podcast with one of your guest experts that they really [00:02:00] recommend investing in the patio outdoor space if you live in Arizona, which is where I’m at. And so I’m wondering, how do I know if I were to invest 15 to 25, 000 in creating this compound feeling with the privacy fencing.

How do I know if it’s actually going to be lucrative? That I’ll actually get more bookings and it’ll actually pay itself off because that feels like such a big investment right now. But in the long run, if it’s really going to get more bookings and it’s going to pay off, you know, I want to make sure that I’m making great investments and I’m also thinking if I’m getting a solid five star ratings already, is it really important to do this?

What are your thoughts on this?

Sarah Karakaian: Great, this is a great question.

Personal Experience: Privacy Fencing in Phoenix

Annette Grant: I’m gonna, I’m gonna share a story really quick.

Sarah Karakaian: Oh yeah.

Annette Grant: Before we dig in. Sarah and I just stayed in the Phoenix, Scottsdale area for a convention. And we were close to the convention center. So as you can imagine, it was more [00:03:00] of, uh, Downtown, I don’t want to say downtown. It was, it was a neighborhood, but obviously close to downtown. And this particular home that we stayed in, thank you, Wendy from Mostest Host. Mostest. host, check them out. It did have the fence, the privacy fence, like I think you were speaking of. It was the concrete all the way around, had that compound feel like even part of the driveway.

You would drive in and park your car on the other side of it. It did have A pool and a fire pit area, but it was, um, Sarah, myself and one of our other teammates and I can share with you that I do think like this home we were kind of, you know, there were three neighbors in back of us and two on the side.

So we had would have had contact with five potential neighbors. That I can share. I don’t know how well kept their yards would have been in this particular area. But [00:04:00] because we had that fence, I literally, we did not see anything. They did not, they could not see us at all. We could not see them. It did feel very retreat esque and super private.

Uh, and, Just once, when you asked this question, Brie, it really brought up me, that particular stay that we just had and how safe it made me feel, how I did not encounter any, we didn’t even see a neighbor, see what’s in their backyard, anything like that. Again, felt very safe.

Bootcamp Highlights and Success Stories

Annette Grant: So just want to share that recently experienced that and it was Also, Bree, the bootcamp is completed, but we hope you loved it. Sarah and I had the best time.

Sarah Karakaian: So many of you, hundreds of you showed up, so if you didn’t attend the bootcamp this time, we will do more this year.

Annette Grant: Yeah, so make sure you’re on our email list so you can find out about it. It was awesome. It was lit. [00:05:00] I wish I could say, we just, we are getting Message after message pouring and people are making changes to their listing because it was a booked and profitable somebody yesterday 3, 600 worth of Reservations coming in and that’s on something that’s a hundred and fifty dollars a night people are doing the work So when you do the work it matters, but back to Bree’s Question so hopefully Bree we took you through some a lot of analytics in the boot camp.

Analyzing the Investment: Questions and Considerations

Annette Grant: So this will prep you for the work You’re going to need to do some work to see if this is going to move the needle.

Sarah Karakaian: I have a lot of questions for you, Brie, so if we had you on here right now, we could ask you some questions, we could dig in even more specifically to your Specific situation because my question to you is, is how new is your, are your listings and you mentioned people are starting to mention the location.

So you said, but you’re getting solid five star reviews. So when you said the word solid, I was like, Oh, you know how a guest can leave you an overall five star review, but they can ding you on things like location and [00:06:00] value. And so if you’re newer and guests haven’t yet done that yet. That doesn’t mean they won’t, especially if they’re giving you private feedback, they might feel a little uneasy in the area.

Yeah, keep an eye on that

value and location because that will impact the algorithm and future bookings, which would, which will

impact your income. Now would it impact your income so significantly that building this fence will boost it right back up? I can’t tell you that for sure because here’s what we’ll have to do.

Market Data and Competitor Analysis

Sarah Karakaian: You need to dig into your market data. I like using Price Labs for this, and I can see who are my competitors at the same price range and what do they offer that I don’t offer. If it is a private, fenced in backyard or a feeling of more of an oasis or retreat or estate and they’re able to charge more per night, Then yes, that would make you more money and drive more bookings

Annette Grant: and we wanted to and we didn’t know Brie You said you use the word compound.

So we didn’t know if you had multiple [00:07:00] properties If you do you’d want to You know, or multiple properties on the same, um, multiple doors on the same property. You know, you could divide that investment across all of them. But for some things to keep in, keep in mind, number one, the fence just, Oh, I think a lot like I want everybody that’s listening.

Always remember the overall equity. that you have in your home. So yes, is it going to bring, it might bring more value to each and every reservation, but Bree, is it going to increase the overall value of your home? Because that’s important, you know, if you are ever going to, to resell it.

Additional Amenities and Long-term Planning

Annette Grant: We also want to know, if you’re putting this fence in, is there a possibility, is there a true amenity that you can add because you have this fence?

Maybe it is a hot tub. I mean, Dare I say maybe a pool, but is there a fire pit? Is there something else while you’re doing construction, while you’re making the investment that you could actually charge, um, a higher rate for, an actual amenity besides the fence? Could you then become pet [00:08:00] friendly because you have a fenced in area?

We’re not sure if you’re interested in that at all, but just wondering, you know, is there a way to Um, do some other renovation at that time that could really impact your daily rate immediately?

Sarah Karakaian: And then you need to dig into the data, you need to dig into your competitors, and when people are shopping around, again, I don’t know how you have your things set up, like do they stay at, are there more, multiple properties, do they stay at all of them, do you, do you separate it off, um, who are your competitors, what are they making?

We’re gonna link our pro forma in the show notes. for you, Brie. Now, I know you’re not purchasing the property, so you, when it comes to like purchase price and things of that nature, you don’t have to put, um, the down payment. Like, you don’t have to put anything in those sections, but what you could put in, we have a, we have a cell for construction or capital improvements or furnishings.

That’s where you could use your fence, and then you could put in your expenses and how much you’re currently making. So at least you can figure out how long it would take you to, to make your money back, your investment back. And [00:09:00] then pairing that with the market data, if this would actually, how long would it take you to make your money back?

Would it affect, uh, you know, your, your future bookings? But I do wonder too, and you could ask, um, I know in Scottsdale, Phoenix, Arizona area, there are realtors who specialize in the short term vacation rental market. You could also ask them their experience with fencing in your area and what that could do to the equity appreciation value of your home.

And to, and to bookings as well.

Annette Grant: Yeah,

Sarah Karakaian: and with

Annette Grant: that, I’m going to use Sarah’s idea of an oasis. Is there a way to add maybe, again, something with a lower investment, like a cold plunge, an outdoor shower, something that, again, makes this outdoor space more desirable?

Sarah Karakaian: And Brie, maybe it was you in the boot camp, but I remember someone else talking about the quote unquote compound, and I took a I took a poll in a boot camp and asked people if they thought compound was a negative word or a positive word because I know that there are some, there are some news happenings where the word compound has gotten a negative connotation.

Annette Grant: And so, it’s [00:10:00] very, it can be culty, right.

Sarah Karakaian: And so, I, I didn’t know, I was like, does that just meet my perception? So Bree, some other words you could use if you end up doing The Fence is retreat, estate, sanctuary, manor, oasis, pavilion. Things of that nature might sound more enticing than the word compound. You didn’t ask for that feedback, but I’m giving it anyway.

But

Final Thoughts and Recommendations

Annette Grant: this is, yeah, this is where you’re going to have to, um, make sure the math maths, but Brie, I also heard it in your voice a little bit, that it’s probably weighing on you, that you’re listening to the guests that might have some concerns. So those are some of those things that don’t fit on a spreadsheet, um, and we could just kind of sense it, that like, you’re starting to wonder, um, will the solid five stars, continue if, um, if people are having, if guests are starting to mention it.

But the one thing we could tell you immediately, and if you were in the boot camp, we brought this to everyone’s attention. Please note this, you know, if your guests are saying [00:11:00] certain things about the area, you might, you want to put this, you want to make this, um, known to future guests that way if anybody right off the beginning knows that they’re there.

It’s obvious to them You’ve mentioned it ahead of time. It’s not a complete surprise One guest

Sarah Karakaian: mentions it

Annette Grant: then other

Sarah Karakaian: guests have thought it and they just haven’t brought it to your attention Brie

Annette Grant: Yep,

Sarah Karakaian: you know so and whether they leave it in your review yet or not is you know up to them to do I also Yeah, and if you’re in this for a long haul, Brie, maybe it’s not something you do today or this year, but maybe you put a, a, a portion of your income into a savings account or a checking account that saves for this and capital improvement down the road.

That’s what I

Annette Grant: really like is like with each and every reservation, maybe there’s just a percentage that goes in and then once you hit a certain amount, then you take the plunge and. I’m just going

Sarah Karakaian: to do it because we love them so much, but breathe. I don’t know if you, who you use for business banking, but relay makes it really easy to do this.

Like on the fly, create a checking account. It’s free. You can do it within seconds [00:12:00] yourself online. And then I’ll do this when like I want to hire a new employee or I want to save for some sort of capital improvement. I’ll have this special savings account. I can automatically put a percentage of my income that goes into this account.

I don’t have to think about it. And then with time, it just builds up. And when it reaches a certain threshold, it’s like, OK, it’s decision time. What am I going to do?

Annette Grant: Mm hmm. Love it. Let’s do it, Brie.

Sarah Karakaian: Alright. Thanks for signing up for the bootcamp, Brie. We appreciate you. Yes.

Closing Remarks

Sarah Karakaian: With that, I am Sarah Karakaian.

Annette Grant: I’m Annette Grant. And together we are Thanks for visiting.

Sarah Karakaian: Talk to you next time. [00:13:00]