Brian O'Leary on his first Airbnb arbitrage home in Iowa

0:00 in today's video we're going to be talking to Brian who's absolutely crushing it by having a strategic game plan he didn't over complicate anything he just followed the road map to a T and now he has a property cash flowing him two thousand dollars a month we're gonna talk about how he chose a specific Market we're even gonna Deep dive into one of his properties we're also going to be talking about how he was able to convince multiple landlords of this business model and also handpick the best one all right we got Brian O'Leary here we he's got a property up and running in Iowa who's you know absolutely crushing has seen his listing it looks beautiful so Brian if you don't mind just kind of uh giving the people an introduction some of your background we can go from there sure thanks Preston thanks for having me my background is I work in information technology in Iowa and uh I've got a good job I enjoy it but I was just looking for other sources of income I've had a uh a rental property before still have one rental property and it just wasn't situated in a good place for short-term rental and I I wanted to expand and instead of expanding into getting purchasing more properties I decided to check out this Arbitrage model that I heard about from you and got my first one up and running and it's just been a lot of fun nice so let's talk about the the whole long-term rental because that's something that I focused on for you know the first three and a half to four years of my career and obviously uh you know there's a lot

1:18 of benefits that come with real estate but I think the one thing that it lacks is the cash flow potential right and so uh you know what what are some of your experiences with your long-term rental what made you want to shift over to uh the the short-term rental game that's a positive experience with the long-term rental um but you know I get a tenant in there for a year or two I think the longest I had a tenant in theirs for three and it just found that the longest I had it longer I had a tenant in there than just the more work I had to do when they left to get another one up and running and and it was Cash flowing well but I was really looking for something to boost cash flow I do want to own more I want to have more assets that I own so I'm using the Arbitrage model to get there like I'm just going to use it to to bring in more cash and then properties that make sense I'll see if there's an opportunity to switch from renting to owning or maybe down the line I'll just be looking for properties to to purchase and to then put on the market as a short-term rental but that's I've really enjoyed the short-term model I like working with the guests and like just having being part of their like vacation experience our experience so far has been that the house has has been kept in really great condition and and just having our professional cleaner in there

2:35 after every guest certainly we're you know preventing like the long-term issues that I've had to deal with when I have a tenant in a single place that's been living there for a year or two years no that's great it's great stuff and you know similar experience to make right because I have experience both in the short term rental and the long-term rental space and obviously if you bet your short-term rental guests properly up front then they treat your house you know sometimes just as good as you would treat your own house so yeah what are some of the challenges that you saw you know from like what are some of the main differences that you see from a long-term rental versus a short-term rental uh maybe some pros and cons of each um just so we can kind of get an idea because obviously like I'm you know going kind of all in all the short term you know short-term rental game not saying there's anything wrong with the long-term rental um side but you know just want to hear from your perspective on the on that front my perspective is um pros and cons So Pro with those the long-term rental is that you sign that lease and you know you're going to have someone in there uh for the Long Haul but then the cons is it does that always doesn't work out right I'll work out for you right like they there's gonna be months where the payment's not coming in and then you've got to chase that down uh there's problems neighbors have problems with what's going on on the property and um so that's the cons and so the pros

3:54 I'm seeing with the short-term rentals is that you know the money is up front so I've gotten paid before they've even entered into the property and but then the the downside is the turnover you know I'm constantly looking for guests to be in my my home every single weekend I want every single weekend booked and then part of the the week as well um so more work uh but more reward in the short-term rental space but with as much of the automation as I could do following the steps that you provided in the Arbitrage class I've been able to really manage how much time I have to put into it each week and it's just a lot of fun to see a new guest get that notification that a new guest is coming and then all the automated messages go out and then I just have to basically take care of if they have a special question that comes in yeah love it that's one of the things I do really like obviously it's a little bit more work with the short-term rental side but then you are rewarded with that higher cash flow potential right and so that's something that I really do like about that model so shifting gears a little bit if you don't mind talking about how are you able to find this property what did that conversation look like at the landlord and how are you ultimately able to you know secure the deal with them

5:12 yeah so I was uh searching on Zillow for places in my target market and found well maybe four or five properties that I was interested in and I was able to get three landlords on board not completely sold initially but it wasn't a no so I was able to get them to the point where we could talk about me coming and seeing these properties in person and I was just following the the script provided from the roadmap tailored to to my personality I think that's important for people to do take that script but then you need to be able to have a a casual conversation with someone and not make it sound like you're reading from a script so it's got to be you know tailored to how you you talk and how you interact with people I would say I had a lot of confidence in the model after going through the road map and just knowing exactly what I wanted to do and how I wanted to do it so I was able to portray that confidence when I was talking to these landlords and so then the next step was to go look at the properties out of the three one just got me really excited I didn't want to leave the property my wife and I wanted to like buy the property and stay there and I thought okay that's the type of place that I want to put on the market as a short-term rental because if I'm excited about it God it's going to be an easy sell on Airbnb or verbo so I

6:30 ended up going with that one uh turn the other two down and um so I've just got the one right now the biggest hurdle I had to overcome to seal the deal was to prove that I could do what I was going to say I was going to do and that was where I was a little hesitant because I was brand new to this model and so that's where just having a group of people behind me was really helpful I was able to tell her yes while I am new to this I am part of a team that has done this for dozens of homes and they are super hosts and here's a link to a few of those you can check them out the level of Quality quality photos and reviews that you're seeing on these listings that's what I'm going to bring to you to your property and so that just really helped seal the deal and was able to close on the house in January and then we got her on the market in February awesome a lot of great nuggets in there so I think one of the main things that stuck out is being a part of a community that you can kind of lean back on because I know that's a fear of a lot of new hoses oh I'm brand new to this how do I present that to the landlord do I lie I like and I'm like no like first if you're a part of a community that has your back that can you know help you guide you along the steps that you need if you don't have answers to certain questions and also just you know being on the expertise of people that have come before you I think is huge um is obviously was able to help

7:48 you secure that deal so that's you know kind of how I got started as well you know being able to rely on others expertise you know and kind of have them vouch for you while you're getting your your footing and show them that you're actually legitimate I think it's really cool that you're able to do that all right so we have Brian's listing here and obviously you know like he was mentioning he didn't want to leave this place and you can tell that right away just from the photos and so Brad if you want to just kind of walk us through your thought process on the design um you know what kind of inspiration you took from it and then we can also talk about some of the updated photos that you're that you're planning on here sure so it's all about knowing your area and so I was in a part of Iowa that has a lot of history right along the Mississippi River and so I was looking for a large house had a lot of history behind it and that's exactly what we got here so this is a large four-bedroom house with a beautiful front porch that overlooks the downtown area and the Mississippi River and you can see three states from the front porch we just wanted to keep it clean we love the bedrooms like you're scrolling through there one thing we did was that bedroom there was we added the bunk beds so that we could get the 10 guests sleeping in the four bedrooms the other three bedrooms each have a queen and so it's

9:07 just keeping that historic look but still modern this this home was built in the early 1900s and then you just scroll past those like pink and green bathrooms that was just something from that era it's just something really cool uh historical about this part of Iowa and so that's still original to the home but everything else has been pretty much updated by the the owner of the house they did a lot of that work so for us it was just getting Furniture in there that looked like you know that matched everything get everything staged the way we wanted it to and then we had a professional photographer come in that had experience with short-term rentals it was important to us that we didn't just stage for photos but we had we took photos of what the guest was going to experience when they arrived there so we made sure everything looked good that it was staged nice but then that's how it's going to look when you enter this home and you're going to get exactly what you were hoping to get when you looked at the photos on our listing yeah I think one of the main things because you'll you'll see sometimes where you know obviously photos can't be deceiving right um and so if you have a house and we've gone this on a lot of our properties where you know the reviews are like the property actually looks better in person than it did in the photos that's the biggest compliment that you can get and so because you're always wanting to you know undersell and then over achieve

10:25 right and so I I feel like just looking at these listening pictures I I can totally you know see that and I'm sure you've seen it in person and you've been there you didn't want to leave um and I also really like this it I mean honestly like in a way like this could have turned out like really tacky and kind of outdated but I think it really works really well with the overall theme of your property thank you so then you had mentioned yes I do want to do some updated photos we had taken these photos in the winter time so when I joined your class I joined in early January we got this property by the end of January and we were taking photos in February and so in Iowa there's snow on the ground and the best part about this house is the front porch and so we've got our photographer coming back at the end of April early May and we're going to be taking new outdoor pictures without the snow we want all the the green leaves and the Green Grass and then we want to show off that front porch nice view from the front just putting our guests in the chairs there as they're looking out at the front porch and out at the downtown in the Mississippi River love it and I love that you're constantly thinking about the guest experience and how to continue to you know increase that because like I feel like a lot of people they you know set up the listing and

11:43 then that's that right they don't touch it again but you know someone like you who's constantly thinking about how they can improve their listing how they can improve the guest experiences only going to have more reviews coming in and ultimately make more money from your listing so I think you're definitely thinking about this sure thank you yeah a couple a couple of things or places where we made changes like we added a dedicated office space which I don't even have in the pictures here yet because I while I took a photo from my phone I wanted to wait for a professional photographer to come back but we now have a dedicated office space we know a lot of people are are still working when they travel oh just adding you know we've had guests that you know asked if there was a crib or like a a gate child gate and we just said yes we went out and bought it and we thought you know this this is a four bedroom house catered to families so it's going to be good to have those things and be able to say yes to Future guests so we've been adding as we hear requests like that and then it could be an immediate yes next time someone comes back or checks out our property and wants to know if it's kid-friendly super important to listen to your guests right I think a lot of people will just ignore their guests be like oh yeah that's not worth it but you know we found like kind of universally across all our our properties because a lot of them are catered towards families are you know like the little things that you don't

13:01 really think about you know pack and plays and you know kid friendly making sure that's all you know taken care of so you know love that you're thinking about that and adding those I don't know those things too so let's talk about you know cash flow numbers right so what are we looking at you know cash flow wise on this property what are you projecting for through the rest of this year so cash flow wise we just started becoming cash flow positive uh in March so we went live in February but you know as you can imagine uh didn't have a lot of bookings just yeah but in March uh cash flow positive probably the you know fifteen hundred dollar two thousand dollar a month range as we approach the summer we just missed super host status since they reevaluated that on April 1st and we did not have 10 guests um before the April 1st but we had our five star reviews and whatever the other criteria where we met that so for us it's just competing with the other larger homes uh in this market and we've got a little bit of competition but their super host status and maybe a little bit higher on the ranking and that's what we're competing with and hoping to reach that point where we're getting that two thousand dollars a month cash flow nice so what are some things that you're doing with your property to stand up from the competition because I think that is something that's going to be increasingly important whether that's their design through you know guest experience through reviews so what are

14:18 some of the ways that you're looking at to stand out from from the the rest of the crowd some of it we've already hit you know we're trying to stand out with like the amenities of the house the front porch and really draw 10 attention to that with the new photos that we're working on Price is another another place where we are trying to stand out I don't want to stand out too much on price I'm just trying to beat the competition a little bit until we've really established ourselves and are high in the rankings and then maybe we don't even have to try to compete on price with others in the area but just keeping the listing updated if I've got a small tweak to make I'm going to make it and go in there and make that adjustment and just so that Airbnb and verbo knows that the listing is active and you know making those small adjustments and just showing them that we're an active listing on their platform great no love love that and you know obviously you know things especially in this space it's not just set and forget it there are little tweaks you have to make to continue optimize continue to push your listing to the front so you're definitely thinking about this in the right way so let's talk about kind of some future goals you know obviously have no property number one up and running you know it's been successful so what are we looking at uh you know for goals for the rest this year on you know property number two three or you know whatever your goals are for for your portfolio so my goal before I even had this property

15:37 was to get a property up and running every quarter so I wanted to have four uh by the end of this year and then continue that next year so in quarter one we got our first property up and running the challenge with getting a second one up and running in Quarter Two is that we haven't been through our busiest season yet for our market so cash flow wise just not a lot of extra reserves sitting in the business account so I don't know yet if I'll be getting the second property up and running in quarter two but I'm certainly looking at properties I want to be ready to pull the trigger on that um if we decide to move forward but in general that's our goal is a property a quarter and then that's short term longer term then is kind of what I said earlier want to start to own some properties in addition to leasing some so I think some properties are going to make complete sense to just lease other properties I think are going to make sense to own and so we'll be making those choices down the road love it so are you looking to kind of just dominate your market and be just because you you know have experience there are able to figure out and have a competition over the edge of someone that might not be as familiar or are you looking to expand into other markets I want to expand so we we started in this market because I wanted to start somewhat close to home I really appreciate the advice and

16:55 guidance you give on remote setup for me personally I just wanted to be really Hands-On with my very first property I wanted to be there I wanted to Stage it I wanted to see what things were looking like from beginning to end and I'm probably going to set up more properties in this market just to take advantage of everything that we have in place cleaners handyman all that footwork that's already been done I want to take advantage of that and have a couple more properties here but then I want to expand into more profitable cities and uh and those are going to be further away from where I live I'm going to be setting those up full remote and following the strategies that you've outlined in the roadmap yeah no that's that's great I think that's a strategy that a lot of the students do take is you know being somewhat familiar with the properties in their surrounding markets and then once they have a really good understanding of how the ins and outs work finding a reliable boots on the ground team then and it just becomes way easier to go and do this no matter where you are 500 2000 miles away from you so I think that's a really good strategy to have so let's just let's talk about you know lifestyle wise right because this is a huge reason why I think me and a lot of other people I'm sure you're included in that we wanted to move into because once you set up the property you can automate a lot of the you know a lot of this business so how many hours per week do you feel like you're actually working on the property

18:11 now that everything's running up in life oh I've gotten where it really tracked that but I would say probably uh an hour to two hours a week some weeks more but a lot of that might just be like you know it's time to do some bookkeeping or other things like that but just for I mean the property itself just it pretty much runs itself um you know with the boots on the ground team there's not a lot for for me to do so it's just kind of the back end stuff and and getting getting everything bookkeeping wise and and then just looking to expand that's probably where I'm spending my time right now is on Zillow and looking for other properties so hard for me to to say how much is spent just on this one property but it's not a lot and I appreciate that about this business yeah I know for sure and I think that's something that you know a lot of people like me included when I first started I'm like well there's no way that I'm gonna have to be able to trust the cleaner to clean the properties and you know what if I don't have an on-site manager and all this all these other what ifs came up but you know what you really know and understand how the business model works and be able to set up the proper systems processes software and all that then it's really can be a pretty you know passive investment which is you know obviously something that a lot of us are looking for Brian let's you know talk about you know before to wrap this up like what's something that you would advise that you

19:28 give to someone who's looking to start their own Airbnb business you know just kind of pieces of advice things that you know you've learned along the way well I would say you need a community and uh like this road map from Preston I can't tell you how many times really on I just I needed someone to go to with a question and it's just because it was new to me and it gave me that confidence to move forward when I was able to have someone respond directly to me with advice about the property I was thinking about leasing you know because for me that was just that was the big step like I had done all the research and made phone calls and you know not a not a big deal there but then when you're about to sign a lease uh then you're like man am I about to do the right thing and just having someone else there to look through your numbers look at the look at the market do their own assessment and then and then say thumbs up man I think this is a solid property if it was me I'd go for it and that just gave me the Boost that uh that I needed and there's a lot of uh organizational skills that are required to to set up something like this so you need to have checklists you need to know what you're going to do first second and third and um so I think that that's my advice for

20:46 someone looking to start a business like this is just know what it is that that you need to do to to get the bank account open for a business get your LLC forms set up a website some of the things that you might not think of and uh was helpful to me to have a checklist that you provided to me Preston so I was just able to march through that list and get everything set up pretty short period of time awesome man uh well you know a lot of great things that you shared today thanks for hopping on showing your beautiful listing and you know best of luck with the upcoming properties and uh yeah we'll talk to you soon