Bernadette is with Jen Clark and they are going to be talking about Airbnb and her succesful journey on the short term rental path.
Listen to Episode 41 Airbnb Queen: Jen Clark
Podcast: Download (Duration: 28:53 — 28.28 MB)
- A career change, from graphic designing to Airbnb
- Her motivation into getting to Airbnb
- The process of owning her first property in Airbnb
- The Fox House, Kyneton property, a property in a rural location
- The second property, Mistwood, Mount Macedon
- The most challenging aspects of doing Airbnb
- Being a graphic designer as an additional skill
- Co-hosting as a much lower risk strategy
- Being full time in Airbnb as a long term goal
- The moral and ethical side of short term rental vs long term rental
- Jen’s 3 biggest tips
01:41 – The short term accommodation course
03:23 – A good move in terms of lifestyle and career
05:58 – Having a landlord that is willing to thin outside the box
08:00 – Being in a rural area is a key challenge
10:23 – Being open-minded and seeing the benefits of a long term arrangement
12:18 – The setup process is pretty gruelling
14:10 – By staying in other properties you take some learnings away
16:10 – Tempting to want to scale quickly
18:28 – The moral or ethical standard of short term rental
20:06 – The Kyneton foodbank
22:12 – A double edged sword
24:00 – Never underestimate the value of beautiful photos
25:47 – A good guide book or house manual
“You’ve just got to think, I guess, from that guest’s perspective about what’s gonna make this stay not only as comfortable as possible but convenient as possible. I think that’s really important. “
Well, hello! It’s Bernadette and today I’ve invited one of our students in our Airbnb students to share her journey because we talk about the fact that Airbnb is such a great way to produce income without a massive outlay.
You can actually do this with properties that you rent. And Jen is one of the students that’s actually doing this really well. And I think you’ll find her story very inspiring.
Jen: My name’s Jen Clark. I’ve spent the last 20 years in the graphic design industry. In the midst of having a bit of a career change, I’ve also had a tree change at the end of last year. I’ve moved from Melbourne’s inner northern suburbs out to Woodend which is about an hour out of Melbourne in the Macedon Ranges. It’s an absolutely beautiful area. The reason for us moving out here we had a baby two and a half years ago. So we wanted to give him a bit more room to move so to speak. We sort of have a look back.
Bernadette: Okay. So you still got your graphic design business?
Jen: I do, yes. I had that business for 8 and 1/2 years. That business is now at a point where it’s just really young. Humming along really nicely, but I’m looking at potentially winding things down with that business towards the end of this year and obviously scaling things up with my new accommodation business which is really great.
Bernadette: Beautiful. Let’s get onto that. Tell us about 6 months ago. What was your motivation?
Jen: Yeah. Well, believe it or not, I actually listen to your podcast. One morning in the car on a trip to Melbourne and I really really enjoyed it. Got me thinking about after having moved to Woodend. What do I actually want to do with the next year, 5 years, 10 years and I always had an interest in interior design renovation all of those sorts of things.
And I had actually been an Airbnb host previously. I had a family room in my house that I’d rented out and really really enjoyed that process, too and met a lot of very interesting people doing that. That sort of got me thinking, well, maybe I could try renting a whole house and renting and subletting it and seeing how that went.
I ended up enrolling in your course. The short term accommodation course and I really loved it every minute of it. And then obviously I got my first property. The rest is kind of history from there. It just seemed like a really natural fit.
Bernadette: Yeah. And I think that’s the great thing about Airbnb, like often. I don’t know whether this is sexist or not but as women we tend to be nesters. But we tend to really love that aspect of it.
Jen: Absolutely. I mean I think having dabbled in the interior design well to my design career that’s something that I really really enjoy. I haven’t had any formal training in interior design but it’s something that it just kind of lands on the job and helped a few people with some renovations and so forth.
It just felt like a really natural fit it was something that I really loved doing. It doesn’t necessarily feel like work to me. I really enjoy people as well and those 3 things combined, it just felt like this could be a really, really good sort of next career, a mini-career change for me.
Bernadette: I know you’re talking about a career change but it’s more than that, isn’t it?
Jen: It’s really like a life overhaul in many ways because up until last year I was living in a really nice house but we felt very crammed in. That’s because of the pace of life in Melbourne it’s just pretty crazy.
We were really starting to feel that and have come out here it just gives you, I mean not only a lot of room to move physically but kind of room to move emotionally as well. And I think gives you that opportunity to sort of grasp exactly what it is that you want to do.
I just had enough of this sort of sitting at the desk daily grind, plugging away day after day after day sitting in front of a computer. And I thought I want to do something where I can draw on my design skills, I can draw on my interest in people, interest in design and et cetera et cetera. And get off and do things that are more physical. Once again when I was listening to your podcast it just seemed like this could be a really good move, but it’s just in terms of lifestyle and career.
Bernadette: Yeah. And so you now have two properties?
Jen: That’s right.
Bernadette: Would you like to share that process? How that sort of come about?
Jen: Basically, I’ve been a lifelong renter so I’ve never actually owned a property. But that’s always been a long term goal to own a place. And particularly now that I have a young son, really came to at some stage. But really it was you actually Bernadette, who introduced me to the idea of like rent arbitrage which is quite an unknown sort of a term here in Australia, it’s quite common overseas. But, here a lot of people don’t necessarily think of it as a viable option.
But really the principle there is obviously you would rent a property as per a normal long term tenant and then get the landlord’s permission. Obviously the agent’s permission to sublet that property on the short term market. So any profit that you make, basically, between the rent and the income that you derive from Airbnb or any other booking source is yours.
Jen: That’s what I went out and did with the first property I really canvassed a whole lot of different real estate agents and was just completely open and honest with them about what I wanted to do. I’ve got a lot of rejections, I get a lot of people saying there’s no way, no way that landlords are going to let you do that.
Ultimately I did get a call one day actually from the landlord directly and she had seen my enquiry and was actually really keen and quite excited to talk about the prospect of letting the property to me in order to manage it and lease it on the short term market. She saw a lot of benefits in that, that a lot of other people were perhaps a little bit more skeptical and less like-minded didn’t see. Things like the property would be very carefully maintained, it would be cleaned every week, the gardens would be maintained. All of those sorts of things that don’t necessarily just naturally occur to people when they think of this kind of arrangement. And she saw all those benefits from the word go.
I think the key to me was having a landlord that was willing to sort of think a bit outside the box and think about it in terms of what benefits could such an arrangement offer.
Bernadette: Yes and often that, I can’t say you are lucky you were persistent in finding a landlord that was open to it. That often it’s a bit of an education process. Sometimes you need to educate the agent as well. But certainly what I find is the longer that a house is unrented the more open they become to alternate solutions.
Jen: Interestingly enough, I sort of thought that, too. In this particular house that we secured as the first property, it was actually, funnily enough, it was probably the least I thought it was one of the least likely houses that we would get because it’s a beautiful big 4 bedroom, 2 bathroom house just recently renovated and the renovation is absolutely meticulous. It’s a beautiful, beautiful property. When we contacted them about it thinking, “You know what? This is probably and there’s no chance in hell of this coming off but I’m just going to put in an enquiry and see what happens.” And it just shows that you can’t really necessarily always predict which houses are going to come off and which ones aren’t. Because the landlord was quite designed savvy and you’d have a lot of pride in the house. It actually paid off in dividends for us because she was the one who was open ultimately to us leasing it on the short term market. That actually worked in our favour.
The Fox House, Kyneton
Bernadette: That’s really great. And so how is that going? And it’s important to note that, that’s in a rural location.
Jen: That’s right. That house is actually in Kyneton, which is a town about 10 minutes drive from here and Woodend. It’s going really, really well. Obviously a lot of our bookings are on weekends. So people coming away from the weekend and also during school holidays. That’s a challenge. That’s an ongoing challenge for me is to know how to get people into the property during the week.
Bernadette: Exactly. Yeah.
Jen: That’s a kind of a key challenge. Particularly, in a regional area but with a concerted social media campaign and with marketing and other promotional activity that we’ve been doing the booking. Our bookings have been really good. We’ve recently entered the top ten properties in Kyneton in only 4 months.
Bernadette: Well done.
Jen: I was very, very happy about it.
Bernadette: Yeah. That’s awesome. And I will make sure that we provide links to your listings in the show notes so that if anyone listening wants to actually go and experience your hospitality. Then, yeah. There you go.
Jen: That’d be great.
Bernadette: So just recently you secured your second property?
Jen: Yeah. The second property actually came about a lot sooner than I planned. When I say we, my partner Christy, is actually almost a silent partner in the business. I’m just naturally used the same way with the second property. We essentially got a call from a real estate agent one morning to say that she had this property that was for lease in Mount Macedon which is kind of 10 minutes in the other direction from Woodend to Kyneton. And the owners there were we’re moving to Sydney basically and they were very keen to have someone manage that property on the short term market. Which was quite unusual I thought because the owners already had an open mind towards doing that.
Mistwood, Mount Macedon
Jen: We went and had a look at it and basically look we absolutely loved it. It’s a beautiful property but having just obviously established the first property and clients. We were pretty cash poor at that time, to be honest. Because we’ve furnished the first property and so forth ourselves and spent quite a large sum of money on that, but doing it properly. And so, really with this second property, it was unfurnished and obviously, we needed to come up with the rent and bond and so forth for that. And so initially we actually said no to that house which was tough because it’s a beautiful property. And I would say that it would do very well in the short term market.
The timing was just wasn’t right. But then as things sort of progressed the properties, and as you said before the property sat there vacant basically for the next 6 weeks and the agent got back in touch with us and basically said look the owner is considering funding the furnishing of the property.
Basically, one thing led to another, we ended up having discussions with the owner about furnishing the property and the owner actually ends up being willing to fund the furnishing of the property. Essentially handed us over some capital to be able to furnish it ourselves which was kind of the deciding factor in taking that one on. Once again it came down to a really open-minded owner that would see the long term benefits of this kind of arrangement and we go. So that was a month or two ago now.
Bernadette: Great. Is that one getting up speed?
Jen: It sure is. Yeah. Like that one. It’s a bit of a lucky property that one. Because it’s just been since the word go. It’s just been we’ve had a lot of interest in it. We’ve had a lot of already, a lot of media, the online media publicity about that particular property and it just seems to sort of a really lucky property for some reason. I mean we’ve had to work hard to promote it to a flying start.
Bernadette: That’s really great. What’s next? Actually, before we go to what’s next let’s just be a bit reflective. What have you found the most challenging?
Jen: The most challenging thing. Probably 2 things. One is obviously capital, making sure that your cash flow is consistent enough to keep paying the rent and to keep funding other services that you need to establish a successful Airbnb property. Things like cleaning fees and laundry, all those sorts of things. You’ve got to make sure that you budget for those things and paying utilities and setting those things up as well. That’s taken a reasonable amount of work to manage those.
Jen: Secondly, I think and this is a challenge that’s just unique to us because we’re in a regional area would be getting those bookings in midweek. Really getting that occupancy rate up so that the houses are being used as much as possible and booked as much as possible. I think those 2 things kind of have been the biggest challenges.
And the setup process is pretty gruelling. It’s not for the faint-hearted. Actually getting the houses furnished and ready to go and photographed and so forth is a really labor-intensive process.
It’s very, very satisfying and a lot of fun in many ways but it’s also extremely gruelling and quite tiring.
Bernadette: Yes, I would agree with that. Is there anything that you found surprising? Or surprisingly good that you weren’t expecting?
Jen: I think the thing that I’ve found and maybe this is more a reflection on my background as a designer.
But I’ve found just working in this sector, in the short term accommodation sector to be quite, just really positive. You’re actually providing a really positive experience for people. Their attitude tends to be, overall, a lot more positive than they would perhaps in some other businesses. I’ve actually found that really lovely. It’s really nice to be dealing with people that are happy and when you’re providing them something to look forward to. I really enjoyed that aspect of it whereas in design obviously it’s a bit of a different ballgame because you’re dealing with people that want things changed and constantly going through this process. But with this business, it’s been a lot. A lot more positive.
Bernadette: I think it’s probably important to note that you don’t actually have to be a designer to be good at Airbnb or short term rental. But I think the thing that’s important is that you sort of really focus on what your skills are.
Bernadette: If your skills are hospitality. Then you do more of that yourself. But if they’re not, if you’re like me and my skills are definitely not hospitality then do that. I’m more about the prettying up and providing and being strategic about it. I think that it’s funny I mentioned in the Facebook group recently that I stayed in an Airbnb in Queensland when I was up there and it was interesting. It’s always very enlightening being a guest, isn’t it?
Jen: That’s right. Oh, absolutely. We actually stayed in an Airbnb a few weeks ago in Melbourne and we had to attend an event in Melbourne. We stayed the night in an Airbnb. It was a totally different approach to what we’ve taken with these properties. It was more like just walking into someone’s home. The door is being left open. So rather than nothing was really meticulously prepared it was all just very quite slapdash. Made for an interesting night. I mean we did actually get a few ideas from staying there, too. I think that’s really important. Like it’s good to actually go out and stay in other people’s properties to not just see what they might be doing badly but also seeing what they’re doing really well and maybe take some of those learnings away.
Bernadette: I really agree with that. And the thing that surprises me how much little things really annoy you. When people complain about little things you think, “Oh my gosh!” When you’re out of your comfort zone and you’re in the foreign surroundings they do annoy you much more.
Jen: Yeah, absolutely. I think having just said that, too. It’s really important to stay in your own properties because.
Bernadette: Exactly, yeah.
Jen: I mean even little things that you might not necessarily think of. Like only recently did I think to actually put a universal mobile phone charger in one of the properties because I think how many people actually go away and forget their charger at home but their phone is so vitally important to them.
You’ve just got to think, I guess, from that guest’s perspective about what’s gonna make this stay not only as comfortable as possible but convenient as possible. I think that’s really important. And having stayed in, I mean we stayed in our Kyneton property not that long ago and yet it’s a completely different experience staying there as a guest as opposed to just creating it.
Bernadette: So now you’ve got into properties up and running. What’s next?
Jen: I’ve actually had a bit of a busy fortnight in the last, well, in the last fortnight. Because I’ve been approached about 4 further properties.
Jen: Which is lovely in many ways but also a bit overwhelming because I think in this business, too. It’s very tempting to want to scale quickly but I don’t think that lends itself to a sustainable business that has a quality focus which is what I really want to do and what I really want to establish. We are actually talking to some other property owners in Mount Macedon at the moment about taking over the management of their property at the start of October and that property is fully furnished and it’s already doing exceptionally well on Airbnb, so it’s a bit of a no brainer from that angle.
Bernadette: So you’re doing that as a co-host rather than renting a property.
Jen: I’m doing it. Yes, essentially as a co-host. That’s right.
Bernadette: Yeah, that’s a much lower risk strategy.
Jen: Yes. And I’m keen to try that arrangement, too. And see how that works versus the sort of rent arbitrage approach.
The other project that I’m sort of working on at the moment is I’m just managing an apartment. Actually, a 2 bedroom apartment for a friend who’s moving interstate temporarily, in Abbotsford in Melbourne. That’s also going to be a big learning curve for me. It’s gonna be a learning opportunity to see how an urban property performs first as a regional property. And this sort of treating it all was a bit of an apprenticeship at the moment and learning and trying to absorb as much as I can.
Bernadette: Beautiful. What’s your end goal to your long term vision? Say in 2 years’ time. Where do you want to be with your business?
Jen: I would like to be obviously focusing on this accommodation business full time and no longer working on my design business. A complete career change first and foremost. But I think by the end of 2021 which is only 2 years away, I would ideally like to have a stable of about 10 to 12 really high-quality: properties. I don’t have any aspirations to have 50 properties or anything. I think I would be biting off way more than I could chew there. But having, I think, maybe a dozen properties that are in different areas that are different types of properties and just once again it will still be pretty early days and then seeing how those properties perform will be really interesting. That’s kind of my aim in the next 2 years and obviously ideally for the business to enable me to buy a property for my family which is something that we’ve always wanted to do. So that’s kind of our why, I guess.
Bernadette: I see big things for you, Jen.
Jen: Oh, thank you.
Bernadette: Just before we finish up I thought it might be an idea. You and I have had a little bit of a chat about the moral or ethical side of short term rental. Is that exploiting the sector of the community that relies on rental properties? And do you wanna have a quick chat about that?
Mistwood, Mount Macedon
Jen: I’d love to. This is something that’s really important to me. I think one of the things that I guess underpins my business as opposed to some of the other short term accommodation businesses. Is this really ethical strong ethical principles. For instance, when we’ve been furnishing, fitting out these 2 existing properties we’ve really been absolutely vigilant about sourcing as many furnishings as we could second hand using sustainable products that might be eco-friendly. Those sorts of things rather than necessarily just buying everything new and cheap. Though a lot more thoughts go into it from that angle.
But also I’ve been looking at how can I use these properties as a vehicle to give something back? Which is really important to me and I couldn’t run any type of business without doing that. And I’ve done that through my design business as well in the past.
Even one thing that was noticeable to me almost from the word go, running this sort of business was this amount of food waste and things that are springing up. It almost seems criminal to be throwing a lot of this stuff out. And so what I’ve done, I sort of sat down and looked at how can I at least try and reduce some of these like I can’t reduce all of it obviously but how can I reduce some of this waste? And we actually have a food bank located right around the corner from our Kyneton properties.
So, I’ve put a crate in our Kyneton property that basically says to guests if you’ve got something left over from your stay, pop it in here and we will take it around to Kyneton food bank and donate it on your behalf. That’s a really small thing but it’s one little way of being able to do something positive whereas otherwise, the food would’ve just been thrown out.
The Fox House, Kyneton
Bernadette: Exactly. Yeah. Time to invest in some worm farms, too.
Jen: I’d love to do that but anything like that. I think you might think that something is just really small or trivial but it’s not. And I think it’s important to just have those little things that you do as part of your day to day business. Over the course of a year, they can really add up.
Bernadette: Exactly. One of the things that are one of the arguments that have been, I’ve heard a lot is that by renting properties for Airbnb. It’s diminishing the pool of rental properties that the people that actually need them. I don’t know about you but I’ve really, really noticed that the demand for rental properties has really dropped and often I certainly haven’t rented anything that hasn’t been on the market for a very long period of time. So, I don’t know that, that argument really stacks up certainly in the present conditions.
Jen: I’m inclined to agree with you because I mean the nature of the properties that we’re renting. We’ve got a 3 bedroom, 2 bathroom property and a 4 bedroom, 2 bathroom property and both of them. I mean the rent is actually probably on the higher level. These aren’t, I don’t know that these are properties that would necessarily be within easy reach of those people who might be on lower incomes, so they are otherwise sitting there vacant.
And I think if we can inject more into the local economy and partake in things like the food bank and perhaps even eventually an Airbnb open homes program which will enable people who do need an accommodation to use these houses during the week or whenever they’re sitting there vacant. Then those are much more productive ways of giving back, rather than worrying too much about taking these higher in houses off the housing market.
Bernadette: Yeah. I would agree with you. There are always two ways of looking at an issue.
Jen: That’s right. I mean the other thing, too. It’s the number one sort of social and environmental issue in Australia at the moment is climate change. It’s a bit of a catch 22, it’s a double-edged sword. Because in creating really great bespoke local experiences for people to enjoy. You’re giving them the option of traveling somewhere locally, there’s a lot of pros to that approach as well. I sort of think of it if you can use your accommodation as a vehicle for good in whatever small ways you can. Then I think it can’t really go wrong.
Bernadette: I absolutely agree with that. And to be honest with you it doesn’t really matter what you’re doing, they can find fault in everything. It’s just really about how you approach what you’re doing and really doing the best you can with what you’ve got.
Jen: And having that consciousness, I guess, of not just sort of flippantly thinking I need to get a bed or I need to get this. But thinking about what you’re buying and where you’re buying it from. And if you can be a bit more judicious in those decisions about where are you sourcing this stuff from. Then I think then that’s also really great. You’ve got the ability to sort of reduce that footprint.
Bernadette: Exactly. So, just before we wrap up can I just ask you what would be your 3 biggest tips? Best tips for someone who is choosing to go down the short term rental path.
Now we’ve talked a lot about Airbnb, but in actual fact, there are many platforms but we won’t go into that now. What would you say would be the 3 key things that someone considering going down this path would need to think about?
Jen: First and foremost, I think you’ve got to have a love of people to be able to work in this business. I think if you don’t like dealing with people and dealing with the day to day sort of demands of guests. Then don’t even consider it because every day you are dealing with people. Fundamentally, that’s what this business is about. So that would be number one.
Number 2, never, ever underestimate the value of professional photos. I think that’s absolutely pivotal. I think out of every single possible marketing tool for these short term accommodation, for these houses. Photos, really great quality photos have been key.
Having a professional photographer come in and photographs the properties and then being able to use those photos to get others, whether it’s media coverage or other publicity and on social media particularly, has been really really helpful. Worth every cent.
Jen: Three, I guess and maybe remember that people are using sites like Airbnb because they want to have a more authentic experience. And I think what can often go wrong is people think they have to recreate a hotel room with an Airbnb property. And I think that’s the wrong approach because it’s about if people want to have things like books and magazines and different arts and they want to have that more homely sort of experience rather than walking into a soulless hotel-like environment.
So I think to make sure that your property is, it’s not sterile or cold or soulless it’s somewhere that people want to spend time and relax and feel like they’re part of the local communities. I think that’s really important and that’s getting a little bit lost because I think given the number of homes on these sites people are going for that cookie-cutter approach. I don’t think that will work long term.
Bernadette: I absolutely agree with you and I think if I had a complaint about the place that I recently stayed at. That was the complaint, that it was really quiet. It was a bed in a room with that private and had its own bathroom and fridge and that was pretty much it. And it does feel a bit, I guess, isolating. You don’t feel that you are a part of the community.
Jen: That’s right. And I think I actually stayed in a place not that long ago, too. And I was amazed at the fact that the guidebook. Which I also think is really important. So providing a really good guide book or a house manual in the house is like, don’t ever underestimate the value of that.
But this house manual had no recommendations at all from the host, as to where to go and I sort of thought if I had wanted to stay in a hotel, I would have. But what I really wanted to know was where can I go to get a nice glass of wine? Where can I go to go for a walk? Or all those sorts of things. So people want to be able to experience it from as if they were living there. And I think that’s really important to remember.
Bernadette: I would agree with you. Well, listen, thank you so much for generously sharing your story and wisdom as I mentioned we will include the links to your property. We’ll also include links to your business as well, l in the show notes so that anyone that’s interested in experiencing your special brand of hospitality will be able to do that.
Jen: Terrific. Thank you.