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Utilizing Tech In Real Estate To Build A Thriving Short Term Rental Business With Jessica Larsen

March 22, 2023

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CWS 241 | Short Term Rental

 

By embracing technology in real estate, we have the power to create thriving businesses that prioritize guest experiences, streamline operations, and maximize profitability in the short-term rental industry. In this episode, Jessica Larsen, a high-energy leader in the industry, discusses how to utilize tech to build a thriving short-term rental business. Jessica shares her insights and experiences on how to leverage various technologies in the real estate industry to create a lucrative and sustainable business model. She shares the benefits of using technological tools such as Airbnb, Jetstream, AI, and more to streamline operations, enhance guest experiences, and optimize profitability. Jessica also touches on what real estate agents can and must do in order to generate leads and manage short-term rentals effectively. Tune in and discover the power of tech in the short-term rental business.

 

Tech tools mentioned: Cape Cod Cleaning Collaborative | Five Star Vacation Rentals | AirbnbVrbo | Booking.com | getsojo | Jetstream

Book a session with Jessica Larsen through BookWithJessica.com

Watch the episode here

Listen to the podcast here


 

Utilizing Tech In Real Estate To Build A Thriving Short Term Rental Business With Jessica Larsen

 Joining me is Jessica Larson. Jessica has been selling real estate on Cape Cod since 2012 and works tirelessly to represent her client’s best interests, guiding them each step of the way. She’s also the President and Co-owner of Cape Cod Cleaning Collaborative and Five Star Vacation Rentals. The company has a client list in the hundreds, and the business gives her exceptional insider knowledge of the housing and investment property inventories on the lower and outer Cape.

She’s also a dedicated contributor to her community, serving on several world boards on Cape Cod, and a mother of three. She and her partner Jeff are devoted and involved parents. Jeff is a stay-at-home dad, and they are a great team, working to navigate three kids through childhood. As a mom of two, I love that you and your husband have found this balance of what works for you guys. We’re on the back of International Women’s Day here, so bravo to you.

Thank you. There can always be more women in real estate. You can say that for sure.

We’ve talked a little bit prior about your journey and how it started. You have some unique things that you talked about with your cleaning collaborative and vacation rentals. Tell me how you got to where you are now.

I started cleaning in vacation rentals because I’m on Cape Cod. I was young. This was many moons ago. I’ve been in vacation rentals full decade now. My daughter was young. Somebody said to me, “Why don’t you walk into this real estate office? They’ve got a lot of turnovers. You can get into cleaning. It’s a great way to start making money.”

The minute I walked into the real estate office, I remember looking at the broker and saying, “I’m going to be back with a real estate license.” Two weeks later, I brought one back. I was with him for about eight years and I started my cleaning company around his need for turnover cleaners. He had this huge inventory. We were able to answer emergency calls. We were able to set up regular service.

It was a great way for me to build my sphere of influence because I did not know anyone. It was a great way to get started. When you put love and passion into something, it naturally grows. From there, we ended up in residential cleaning and commercial cleaning. That naturally grew into its own little baby. In the meantime, I stayed in real estate, expanded my sphere, and eventually, wanted to go out on my own with my broker’s license.

Now, I’ve got these relationships. I’ve got clients. We’re cleaning houses. I’ve got my own people coming in. How do I take all of that and make it a business that I can grow, scale, and be effective in immediately? The biggest shortcoming was how I am going to distribute my listings. I have cleaners and clients, but nobody is sitting around in an office answering phones. How are we going to process stays? What tech are we going to use? Where are we going to list? Where am I going to get the cash to build a direct booking site? When I have it, how am I going to direct traffic there?

All of that was what led me to find that there is something called channel distribution tech. It is something that is widely used in the hotel/motel space. To take extra inventory and put it on platforms like Airbnb, Vrbo, and Booking.com. There are a lot of different channel manager tech options. You can get something you’re going to use in your office. You can get some that might sync two platforms. There’s a lot of murkiness.

Effectively, I still don’t know how. I’m a big believer in fate, so I think I manifested it, but I found a company that was doing this in the hotel/motel space. I shot them an email and I said, “I see that you’re taking big hotel inventory. You’re putting their name on it. You’re throwing it onto the internet for them. You’re processing all their stays. Could you do this for me? I know I’m a teeny tiny fish, but this sounds great.”

They called me back and we spent a whole year putting together what would it look like if they took my listings and put them out. We started with one. We quickly grew to five in the first year. All the tech we would have to put in between to get it all the way down to the cleaners. How do we have an OpenAPI so that the cleaning tasks are scheduled? How can I let go of certain tasks? I need a guest communication team and a reservation team. How do I implement all that so that I can grow my business?

That’s what I was able to do, and now I have the privilege of growing around and sharing this with other people in this space. There are a lot of real estate agents out there who would take short-term rental listings and they don’t know how. They don’t want to be answering Airbnb messages at 4:00 AM. They don’t know how to link with a cleaner. They don’t know how to do that. At the same time, they have the kernel of something great. They have an amazing sphere of influence. My goal is to help people diversify and capture that.

It seems like you lean pretty heavily into tech. In an industry that is still a little bit behind in terms of technology usage, I’m assuming it would be a differentiator that sets you apart from your competition.

Something as simple as automated door locks, which we got rid of keys. My cleaning company, a few years ago, told everybody that we cleaned for, “I’m sorry. We can’t launch with keys anymore. It’s a logistical nightmare. You can put it in a lockbox, but you’re going to have to have something.” By now, most of our partners and everybody under management has locks where we can swap the codes out and the guests get unique stays.

This is basic tech. They get a checkout code. When they check, the unit shows it’s ready to clean in our dashboard. At 7:00 AM, we used to be driving around houses to see who got out, so we can start early and flip things. Now, we have this dashboard in live time where we can get the information if this party has left from the door.

This stuff saves us so much time. It’s so basic at this point and what the young people seem to be calling a vacation rental tech stack. That’s effectively where I find myself. It’s helping other people implement a tech stack. If you’re going to grow and scale a business like this, you need to focus your efforts on growing and scaling your portfolio. You do not want to be in the day-to-day muck of guest management.

Let’s talk about that. Once you were able to get this tech stack fine-tuned, can you talk about the impact on your business? One, I’m assuming, is your time. Being able to do more of the business growth versus being in the weeds. How did that correlate to rentals under management? Did you see a big growth?

We did. We also saw that we were able to be more selective. Growth isn’t always volume. Sometimes it’s, “Can we take the clients we already have and do more with them?” Offer a better service, and create more, rather than going out and trying to get more clients. That was a huge turning point for us. We could go to some of the clients we were doing vacation rental turnovers for and say, “We’re already in your house. For a small percentage more, we can do the whole thing for you. Since it’s in-house, it’s hands-off.”

Growth isn't always volume. Can we take the clients we already have and do more with them? Offer a better service, create more, rather than going out and trying to get more clients. Click To Tweet

From a real estate perspective, most agents want to stay out of that day-to-day muck of the cleaning, so I advise them to find a strategic partnership. That’s when they need to find a cleaner and have a conversation about, “I’m going to bring us listings. You’re going to bring us housekeeping.” For me, it made sense to grow my housekeeping company because that was where I started.

CWS 241 | Short Term Rental

Short Term Rental: From a real estate perspective, if you’re an agent that wants to stay out of that day-to-day muck of the cleaning, you need to find a strategic partnership.

 

For ambitious people, there are two different sources of revenue right there. That can insulate you because there was a minute when vacation rentals froze during COVID. Nobody knew what to do, and we all just froze. I can tell you that we kicked it into gear with our cleaning company. We kept everybody on staff. We operated through that. The minute we could get our vacation rental business back up, we did. We ended up housing a lot of people from the city. It enables you to pivot a little bit and stay where you need to be to keep the whole picture.

A lot of people are looking to get involved in real estate and start their own businesses. When people think of short-term rentals, they think, “I have to own them all and manage them all myself to have some passive income and build a profit.” You capitalize on a need. Find the need in the industry and build around that. Knowing you, I’m assuming it’s not happening, but if you were to stop and manage what you have, how many hours do you feel like you would be putting in a week to manage what you have now?

I put in more than I have to and I know that. I don’t have a strategic cleaning partnership right now. I do have a company, but I’m pretty involved in that and that’s a choice that I made. If you remove that, if you outsource your cleaning and let somebody else do that, not much. The work is done upfront when we get a listing.

It’s getting the owner on. You got to clean it. You got to get stills. We want a 3D tour for everybody. We’ve got to order the linens for the beds. We do automated amenities through Getsojo, which is fun. We do automated amenities, but we got to get that in the queue. It takes about two weeks of everybody being on time to get the listing completely ready to go live like that.

From there, not much because all of the inquiries are being answered by my guest communication team, which comes with my channel manager, Jetstream, so it’s a white label. They answer all of my inquiries in Five Star Rentals, which is who I am. They do all of that. They only call me when they need me. If there is, for example, a beeping fire detector in the house and the guests can’t reach it, there is nothing the guest team can do about that. They’re going to pick up the phone and call me. If somebody calls them up because they might have a simple question, maybe it’s a message like, “Is it a drip coffee machine or a Keurig?” They can go on the 3D tour that I took at the beginning and look to answer the question without calling me about it.

The longer you’ve had a listing and the longer they’ve known you, the more reactive they are. People tend to think of them as being a call center and they’re not. Jetstream is an employee-owned company. The guest communication team is full of the kindest, smartest, and nicest individuals who also happen to be multilingual. They’re amazing and they have been doing all of my communications with my guests for years now. I would never go back because I have managed listings in the middle of the day long enough to have done that. Zero regrets there.

It shows that if you’re looking to get into real estate, you can do it without buying 4 or 5 short-term rentals. You can do it by finding the problem or pain point and serving that, and still building a life around your terms.

The other thing for real estate agents, in particular, use your colleagues. If this is something you want to get into, tell them, “I’m doing vacation rentals.” If they get a listing, give them a revenue forecast. Help them understand what kind of an asset that could be as a short-term rental, because then if they find that buyer, they’re going to bring it back to you.

CWS 241 | Short Term Rental

Short Term Rental: Real estate agents can use their colleagues. If they get a listing, give them a revenue forecast. Help them understand what kind of asset that could be as a short-term rental, because then if they find that buyer, they’re going to bring it back to you.

 

Here on Cape Cod, just to take this to one more level, even though I operate, which I do, and I’ve partnered with this company. Other agents who used to bring me listings, I help them keep their listings and do their distribution, and then I anchor my cleaning company to it. In turn, all of their listings go right into my cleaning company. In that way, even though we’re competing, we’re working together and leveraging the best employees on the Cape.

I used to work at a software company that did property management software. We would get a ton of calls about short-term rentals. It’s not something the software handled. I still don’t think they do. This was back in 2010, 2011, or 2012 maybe. Now, I still don’t think there’s not a ton of market saturation there. There’s still a ton of room for growth.

This is something I believe in any industry, that technology will set you apart. As you said, you have a customer support team that is human. There is an interaction. It’s not an automated bot you’re speaking with. Having the technology in the way for them to communicate back and forth is going to set people apart in any business, specifically real estate.

I’m going to go a step further and say there’s all this talk about AI. I was at a conference and there was a private investor who was saying that if he looks at a company and they’re not using AI, he puts them at the bottom of the pile. I personally think that’s a little aggressive for where we’re at right now with AI. I have to ask. Is that something you’re using? If not, why not?

We’re using a lot of automation and OpenAPI. You are specifically asking about a chat AI?

Yeah, like ChatGPT.

Personally, I’m staying out of that because that would be a time vortex for me. I do know that our guest communication team is experimenting with it. I do know that they’re testing it out for the content of the listings because they do all the writing of the content. It’s being used on that level. We are not the point and nor do I think we should be. It would make me uncomfortable if we were using AI all the time. For example, in place of the people, I’ll take the people any day of the week. I’m sure there will come a day when I would be more comfortable with it, but for me personally, it’s your name that’s on this and I’m all ready to give that to it. AI, not quite yet.

I agree. Whenever someone is using ChatGPT, it’s a great jumping-off point. I can tell you. I get so many LinkedIn messages daily or I see LinkedIn posts. I’m like, “That doesn’t sound like personality. That sounds like someone else wrote it and it’s trying to sound super sophisticated or a certain way.” If you’re going to use something like a ChatGPT, it’s a great starting point if you’re stuck or having writer’s block. Use it to add your own flavor, personality, or voice to it. That’s where it is now.

Maybe five years from now, maybe I’ll change my mind. Maybe the way it’s moving, apparently, someone would probably say a year from now. Right now, I’m in agreement with you. I’m not quite there yet to say it could take the place of someone who’s emailing on my behalf or reaching out to an investor on my behalf. I’m also very much a people person, so I believe in that personal touch. Tell me a little bit more about when you’re working with someone who’s interested and says, “I love what you’re doing. I’d love to implement this technology in my business so I can take on short-term rentals.” What does that conversation look like?

It’s a personal conversation. I say that because I feel like in the past years as I’ve been working with the tech company, a lot of times we’re like, “How can we automate this conversation?” The truth is, everybody’s needs are different. Everybody’s market is different. Everybody’s business is different. Understanding what it is they’re trying to do is primary, and then how can we get them there?

The truth is everybody's needs are different. Everybody's market is different. Everybody's business is different. Click To Tweet

Sometimes we hear from agents or managers when they have five properties. If you’ve got five properties and no automation happening, you’re feeling it. If you haven’t implemented techs and door locks, you are going to be feeling it at about five properties. Sometimes we hear from people around then, and they just want help cleaning up an existing operation.

Other times, it’s okay. You’ve got this business. You’ve got these relationships. On Cape Cod, the number of houses that are closed seasonally here, and we keep them open year-round with dynamic pricing. Can you imagine a whole asset sitting closed? It makes my heart bleed. Other agents, who do you know? If you’re in a market where you’re heavily seasonal, could you help somebody turn that asset into a revenue stream for them? Especially if it’s just sitting empty. You would be surprised at how many houses are empty for a year.

CWS 241 | Short Term Rental

Short Term Rental: Could you help somebody turn that asset into a revenue stream for them? Especially if it’s just sitting empty. You would be surprised at how many houses are empty for a year.

 

It’s about figuring out what it is they want to do, and then how can we make it work. Sometimes it’s them implementing this text. Sometimes we get creative for smaller PMs and they bounce off of mine. Instead of getting their own task management software, we put their property in because it’s not customer-facing and we hope they’re cleaner wherever they are. We bounce off of what I built because it’s easier for them.

It depends on how involved they want to be, but I can tell you that passive residual income and rental income is not a bad thing when you’re in real estate and sales. It can be very like this and you have to be able to weather the storm. It is nice to have something that is more consistent than that. The other thing is it’s a great top-of-mind tool. You’re working with clients.

Can you imagine if you’re putting a deposit into their bank account every time there’s a stay? They see your name right on their bank statement next to that deposit. They’re going to come to you when it’s time to sell that asset. There’s this idea of nurturing a bigger relationship. Depending on the laws in any area, you can virtually manage. You’ve got a client who might own houses where you are, but you find out they have multiple houses, maybe they like to travel. You could expand outside of your market in some cases.

Most of the people who come to you to either help, not manage their unit but want to grow a short-term rental business, do they have a real estate background? Have you worked with people who are like you? They got their license and they’re like, “I’m going to do this.” They’re newer to the industry, but they have drive. Are those people you’ve worked with? Have you helped people implement outside of the Cape?

Yes. I have a couple of partners across the US now, which is exciting. I have a little geo going up in Wisconsin and Minnesota. They’re not all realtors. I will say that the National Association of REALTORS has featured my story and this text. They’re starting to hear me. I’m like, “If agents don’t start embracing this technology the way that we do in sales.”

We should be doing this in long-term rentals, short-term rentals, and commercial leasing. It’s a lot more than just residential sales. I would like to see more support here. Why do I have to go to the internet and find it on Google? The more real estate agents that embrace this and keep their professionalism more the pros. You can’t be hacking it along when you’ve got a real estate license.

Real estate agents are great. I think their biggest fear is the property management piece. “What if this becomes a time vortex? I don’t want to clean.” That gets down to having a real conversation about finding. If you’re going to get into this business, you need a cleaning partner. You can do that very successfully where everybody stays in their lane.

CWS 241 | Short Term Rental

Short Term Rental: If you’re going to get into real estate business, you need a cleaning partner. You can do that very successfully where everybody stays in their lane.

 

When you were starting to utilize tech or before, did you run into any speed bumps along the way or things you wish you could have done differently or you would do differently?

No. We’ve never implemented tech that we hated. Once we got used to it, we kept everything we’d implemented. For some houses, we go deeper. We do temperature controls and those might have cameras. Some houses go all out. In some houses, we just do the door locks and the noise monitors. It depends on the nature of the house and other things.

It’s all positive, so much so that when I take on a fully-managed listing, we buy the lock. This isn’t something, it’s part of our agreement. We’re going to put it on your door. I bring all the tech in with me. There are managers out there that charge owners for the tech because we put the lock on the door and we don’t own it. It’s hard to get rid of me when it’s to all my tech. Do you know what I mean? It makes our flow a lot easier, and our owners are very hands-off. Vacation rentals don’t feel burdensome to them.

If you were to give advice to people who are tuning in, they might be a realtor. They’ve thought about the management side of it, but they’re overwhelmed by all that could entail. What would you say to them?

1) I would love to meet with them. They’re welcome to book a time to talk to me. I keep a Calendly at BookWithJessica.com. it’s easy to remember. I would welcome this conversation with anyone because short-term rental dorks can talk about it all day. I’d love to hear about it. 2) I would say that you focus on your strategic partnerships. You think about what it is you would want to do with that business, and how involved you want to be, and then you begin to put the pieces into place. From there, it’s doing a lot of the same things that real estate agents are already doing.

We know how to create relationships, network, and lead drive. Good agents in some of those branches, long-term rentals, and commercial rentals, get really good at working with other agents. You want to view other agents as your friends because not many of them are in rentals, so they’re going to have referrals for you.

As a real estate agent, you should view other agents as your friends because not many of them are in rentals. So they're going to have referrals for you. Click To Tweet

That’s what I would say. Take a look at it, figure out what it is you want to do, find the right partnerships, and understand that when you do find a cleaner, you’re going to need to pay them well. That’s half the business. It might even be a little more than half the business. If you’re not going to start a cleaning company, which isn’t for everybody, you are going to have to figure out how to factor in paying that person fairly if you want them to take the phone call.

If people did want to reach out to you, learn a bit more, and maybe work with you, how would they do that? Is it just BookWithJessica.com?

That’s probably the best way. It’s to start with a conversation. I have started some productivity groups within Jetstream. When we take on new partners everywhere, we do meet together once a month to mastermind. I meet with some of those partners more frequently. It just depends. As I said at the beginning, when you’re learning, there’s more work. If you do it right up front, you don’t have to do it again. It’s worth the time and energy to do it right the first time.

The best way to reach me is totally to book your time. I’m also on Facebook because I’m old, so that’s about what I can manage. I am on LinkedIn, but it’s probably not the best way to reach out to me because as you said, those AI bots have killed that one for me. It’s very hard to wade through who’s reaching out authentically and who’s not. I’m always ready for one-to-one.

Thank you so much for joining us. Everyone tuning in to this episode, if you enjoyed the show, share it with a friend, subscribe, or leave us a review.

Thank you for having me. This was fun.

 

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About Jessica Larsen

CWS 241 | Short Term RentalJessica is a high-energy leader is an understatement. Her dedication to her family, business and community are unparalleled. She has been selling real estate on Cape Cod since 2012 and works tirelessly to represent her client’s best interest, guiding them each step of the way. Jessica is also President and co-owner of Cape Cod Cleaning Collaborative and Five Star Vacation Rentals. The company has a client list in the hundreds, and the business gives her exceptional insider-knowledge of housing and investment property inventories on the lower and outer Cape. Jessica is also a dedicated contributor to her community, serving on several boards on Cape Cod. She was elected to the Town of Brewster School Committee in 2015, and served as chairwoman of the Cape Cod Collaborative for five years. The thread that connects all of her volunteer work is her commitment to the youth and families of our community. She is a passionate advocate for those who don’t always have a voice and need someone working for their future. As a mother of three children, Callie, Maverick and Paxton, Jessica is well-aware of the needs of children and young people. She and her partner, Jeff, are devoted and involved parents. Jeff is a stay-at-home dad, and they are a great team working to navigate three youngsters through childhood. Their household also includes Jessica’s beloved mother, Kathy. It’s a very happy, busy multi-generational household, rounded out by her doggy co-pilot, Goose.

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