How Chad bought Camp Manatee, his first short-term rental

0:00 Chad went from a complete beginner to making over $90,000 of bookings over the course of his first year. Now, he started off with long-term rentals, but quickly realized that short-term rentals could be way more lucrative. So, we're going to go over how he's been able to crush it with his property and plans for the future. You don't want to miss this episode as he shows us how to dominate a less competitive market. All right, we got Chad here. Thanks again for your time, Chad. You know, looking forward to speaking with you today. I know you've been, you know, doing very really well with your with property here. But before we get into all that, wanted to take a step back and kind of hear about your experience, you know, your background, and we'll take it from there. Sounds good, Preston. And uh first off, thank you for uh having me on here. I'm a huge fan. Definitely a student of yours for sure. Hopefully a success story. But as far as my background, pretty pretty normal guy, you know. I've got a beautiful wife, two beautiful kids, dog, two dogs, actually. Got another dog. Been working at the same job for about 16 years. My wife's a full-time teacher.

0:51 And you know basically I think I felt a lot like a lot of people when co came through just kind of in a rut just you know really looking inside myself and seeing you know am I doing what I really want to do and so you know I started thinking about legacy and I started thinking about you know what am I going to leave for my kids and and you know is this really what I want to do for the rest of my life and want to make more money obviously and you know that's when I started kind of looking out where else I could bring some more income in and your information came out you know I started seeing your material you're um you know learning from you and and others. And so I started to you know actually uh invest in myself, start taking some classes, start putting some money out there and you know I I purchased my first short-term rental which is Camp Manatee. Purchased that October 25th, so about a year ago. And yeah, it's doing great. It's exceeded my expectations. You know, I'm on track to hit probably just under 90,000 gross revenue for the first year. So that's that's like I said, it's exceeded my expectations. I was kind of thinking we'd be around 65,000. Learned a lot.

1:54 Still learning, but you know, definitely I'm I'm hooked on this. And, you know, my plan is to obviously get this maximized, get Camp Manity maximized, and then start looking at other markets and, you know, have a portfolio of of properties um that uh myself and my family can visit and use and and also hopefully have other people pay off the bills. So, pretty much in a nutshell. Awesome. That's, you know, a lot of good good background and a lot of things to unpack there. So, you know, it's interesting that you mentioned, you know, co, right? Because I think a lot of us, we had a lot of time to just kind of sit inside, think about life, you know, what we want to do. And that's kind of how, you know, I started, you know, you know, posting content because I had been investing before that, but I'm like, you know, I'm having all these people from my family, my network, you know, co-workers reach out to me wanting to kind of understand how to get started in investing. And so, I'm like, how can I kind of multiply myself cuz I'm taking all these calls, doing these lunches, and how do I kind of get the things that I learned? And I'm not saying I'm like like this guru expert by any means but you know the conversations I've had with friends it was really starting to help them. So I think a lot of introspection happened and I think you know I've heard similar things so I just thought that was interesting. But let's talk about your kind of your upbringing right like do you feel like you've always had this entrepreneurial mindset you know instilled in you at a young age or did do you think that started developing as you started your own family and so and so forth? Yeah you know I've always kind of had um sort of that spirit in me.

3:10 I've had businesses when I was a little kid. you know, I did window washing and stuff like that. And then I actually had a a long-term rental that I I recently sold. And so I've always been into real estate, always had an understanding of real estate. Always had a knack for finding good properties, just seeing the value, seeing something that that I knew other people would would like and and would appreciate. So I think the combination of those two things really steered me in this direction. And of course, you know, the asset, right? I mean, real estate is just such a great asset. You know, I I remember watching a video where, you know, they drew a box on a whiteboard and they split that box up into four pieces and they said, you know, look, in this box, you're going to have appreciation. Your property is going to appreciate on average 6% per year. Obviously, down here in South Florida, it's a lot more. And then you move over to the next box, and the next box is, you know, you're going to have ultimately somebody else paying down your principal. And, you know, that that's awesome. And then you look at the the box down the corner, and that's your tax savings. So, you know, there's there's a whole host of things that you can do with your company and with your property to help offset your your taxes.

4:14 And, you know, I'm a W2 earner, so I pay taxes. And, you know, one of the things that I've always seen is, you know, oh, they don't pay any taxes. They don't pay any taxes. Well, I do pay taxes. And actually, you know, I actually create, you know, opportunities for people in the economy, you know, local economy. When you look at what we do in the Airbnb space, you know, we're hiring cleaners, we're hiring management companies, we're hiring, you know, all sorts of people to to help manage that property locally. And then, of course, those people are going to visit that property and are using all those, you know, local businesses. So, you know, at the end of the day, you know, I am paying a good fair share of taxes and and, you know, I'm generating the, you know, an economy, a local economy. So, I, you know, that's that's definitely helped me sort of visualize that a little differently. And then of course the last box is cash flow. And if you can get cash flow, obviously that's huge. You know, you're going to be getting more revenue in the door and you can use that for what you want. So when I look at that box and and this was presented to me, I was like, there's no other investment that you can make that can get you all of this return. There's really not. And it's tangible. It's something you can use. It's something that you can pass on. So I mean, it's really, you know, broadened my horizons.

5:22 And again, my my goal is to have a multiple uh portfolio of of of properties. You know, not just here in South Florida, but you know, I'm looking in North Carolina. I'm looking in Georgia. I'm looking on the West Coast. Um I think you guys are out in Utah. Certainly, that region is is pretty cool and I have interest to visit there. So, I mean, you know, and again, that could be my retirement plan, right? you know, once I leave my day job, you know, I have have all these properties out there that are passing income and revenue to me. So, I don't have to worry about what the stock market's going to do or I don't have to worry about losing my job. And and you know, that's given me a whole different sense of how I approach my real job because now I'm not like, you know, going there thinking, oh my god, you know, what if I lose this job? So, I'm I'm taking more chances. I'm taking more risk. I'm I'm doing things more in line of of what I wouldn't do in the past because I I just feel like I have this this other opportunity if things don't work out there. So, I mean it it's truly life-changing. It really is. Yeah. No, a lot of good stuff there, Chad. So, yeah, one of the things that you touched on with that the buy box, right, with real estate, that's something that I really love about real estate. And obviously, you know, I focus on the arbitrage method because there's a lot of people, you know, they need cash flow immediately, right? And so like those all those kind of secondary benefits, appreciation, those are all great, but I think a lot of people, you know, want to, you know, from the people conversations I've had, they want to,

6:39 you know, quit their jobs as quickly as possible. So that's why, you know, focus mainly on that. So I know, you know, you mentioned, you know, the buy box of the four different quadrants. You know, awesome stuff. You obviously there's the inflation hedging as well that comes along with that, right? Cuz you're locked into this fixed rate debt for 30 years. You know, inflation's going to slowly eat away, you know, at your savings, right? But also eats away at your debt, so it's easier to pay back, you know, as more dollars circulate. Don't want to get too nerdy about that, but obviously, you know, that's another, you know, great benefit. So, I want to talk about how did you get the confidence because, you know, I don't think I think most people will start with the arbitrage meth. Um, but you went directly into buying. So, what gave you that confidence to go straight into buying? Because obviously that should be the end goal with everyone in all these properties because you could own them. You have all those other benefits that you mentioned. So, what gave you that confidence to, you know, go off with purchasing, right, rather than going the arbitrage method? Yeah, I mean, it was scary. I'll be honest with you. I mean, you know, basically what I did was I took equity out of my primary residence, which I'm sure a lot of people do. And, you know, we visited an area that we really, really enjoyed. And I said, you know what? I'm going to I'm going to take this leap. And and it's funny because um I always wanted a golf cart.

7:40 Always wanted a golf cart. I'm like, I can't afford a golf cart. I can't do it. And I kept coming up with excuses as to why I couldn't do it. Well, guess what? I did it and I have it and I can, you know, I'm able to pay for it and everything else and all the other concerns that I had. So, I mean, sometimes he's got to do it and and and I kind of, you know, that golf cart sits in my garage and every time I go to work, I see it. And that's been my like inspiration, you know? So, I'm I'm kind of, you know, that I think that's what people need to do. They need to visualize where they want to be and and honestly, stop making excuses and do it. And and you know what? What's the worst that could happen? You know, you lose you lose some money. Obviously, you don't you don't want to take risks that are going to bankrupt you, right? you you got to make, you know, conservative, you know, changes and things that are not going to destroy your your lifestyle, obviously. So, and and there's ways to do that, obviously. You know, for example, for my the house that I bought, Camp Manatee, you know, I put 25% down, which I know is a lot of money, but you know, the way I looked at it is look, if this thing falls apart in a couple years, um I can always uh sell it and I'll have a lot of equity and then I'll walk away, you know, on top of it. So, um you know, everybody's journey is going to be a little different.

8:46 Everybody's risk tolerance is going to be a little different, but you know, you just got to do it. And and and I think the arbitrage method is is is beautiful for people that are looking to dip their toe in the pool, so to speak. You know, to look to get to taste it, to see it. And and it's it's a sort of it's a very risk, you know, it's a less risk obviously when you're not putting out $150,000 down payment. You're, you know, as you said, you you do increments of 10,000 and then you rinse and repeat. And and I mean that's basically the same thing I'm going to do but on a smaller scale or you know so you know my plan is once once I have enough equity in this property obviously once the mortgage rates and everything else start to uh hopefully go back to where they were you know I'm going to rinse and repeat I'm going to take money out of that property and and roll it into a new one and and keep doing it and that's the plan. So I mean it's basically the same concept.

9:33 It's just you're you know the arbitrage is a little you know less risky from my perspective because you're dealing with less money less capital. Yeah. No for sure. that's definitely why, you know, preach that. But obviously there's, you know, nothing wrong with going the purchasing method and that's, you know, kind of what I, you know, I do myself now just because of, you know, where I'm at in my career. But, uh, I'm sure, you know, having, cuz you mentioned having a long-term rental in the past. Kind of want to dig into that a little bit as well. So, I'm sure purchasing that gave you the confidence like I've purchased properties before and so, you know, it's kind of, you know, obviously different business model that we're going to do with the short-term rental. Let's talk about the long-term rental a little bit. You know, what made you want to sell that property? You know, what were some of like the challenges, some of the positives about owning that? just cuz you know I have a portfolio of you know 40ish rental units at this point. I have my thoughts on that but I want to hear your thoughts there. Yeah. So I mean you know I I um I went to school up north and and I um graduated from school and I didn't have a job so I came down here with my parents and you know I this this there's this condo that came on the market and it was on the water and it was reasonably priced. So I bought it and I lived there for a couple years and then I met my wife and obviously the condo wasn't big enough for for a family. So, we ended up using that property as a as a long-term rental. And then, actually, we took the equity out of that property to purchase a foreclosed property, which we went in and used that equity to to fix that up.

10:49 And then I used that property to move into the property I'm in now. So, it's it without getting in the door, I would have never been where I'm at now. And, you know, people talk about real estate all the time. They say the best time to own real estate is 10 years ago, right? And the second best time is today. That's I I can't say that enough, you know, because people have this vision of they want to be in this certain house. Well, you can't get there today. So, how are you going to get there? You buy something small and you use that eventually to bump yourself up. But going back to the condo, um, you know, I will never buy a condo unit again just because I like control and obviously when you're in a condo, you you don't have a lot of control. there's there's an HOA, you have shared walls, you have shared roof, you know, things that people do that you have no control over directly impact you. So ultimately, it didn't really fit my my portfolio, so to speak, and where I wanted to go. And and again, you know, there's a lot of wear and tear, right? You get somebody in there that's living in that place every day. They're doing things. They're making modifications. And and honestly, you know, the revenue that you get from an Airbnb is so much more significant and and you're getting somebody in there to clean that property multiple times a month. So, so you know, the the property is is lasting longer and you don't have to renovate it as much. So, you know, I missed the condo and every every once in a while I kind of kicked myself to say,

12:06 you know, maybe I shouldn't have done it, but ultimately it was giving me more headaches than it was worth and and then, you know, I I use that money obviously to do what I'm doing now. Yeah. No, that that's the thing beauty of real estate, right? because there's always going to be even if there's like zero appreciation for like let's say 10 years which is you know doesn't happen but let's just assume that you always have the principal payown right so you you're still building equity in that from that sense and you know if you have a tenant then they're paying it down for you so there's always these different like you know levers that you can pull within real estate which is why I love the business vehicle right uh just because you know you are protected and you're getting paid in five different ways simultaneously and so even you know in a scenario like yours where it might have been some headache but you still came out ahead because you you purchased the property at the right time, you know, so so love that. So, let's let's talk about your, you know, Catman team. Awesome property and you'll be live for a year. That's awesome. So, how did you kind of gravitate towards that market and then ultimately choose the property that you have right now? Yeah. I mean, so we went up there a couple years ago and uh it's in the North Florida area, so it's it's outside of Gainesville, so college town area, but in addition to that, it's um on a on a river and it's very very close to a lot of the uh natural springs. I don't know if you're familiar with them, but there's springs down here in Florida that are crystal blue and they stay 72° year round. And believe it or not, other than beaches in

13:24 Disney World, they're the the third most attraction that people come to Florida for. So, you know, I've got the university within 40 minutes. I've got these springs within 5 to 10, 15 minutes. I'm on a river. The property is 3 plus acres, but it's adjacent to another 25 acres that will never be developed. And then right across the river is a preserve, a 6,000 acre preserve. So the wildlife that you see up there, deer, turkey, boar, I mean, it's just so different from from South Florida. So it's funny because Flidians typically, you know, when they go on vacation, they go to the Keys or they go to North Florida or Georgia or or North Carolina, whereas everybody else goes to Disneyland and Disney World or whatever and the beaches. We we try to avoid those uh when everybody else is going there. So, and then as far as, you know, at the actual property, I mean, you know, I think you've talked about this and preached this, it's really, you know, the realtor is such a huge part of the equation. I mean, when you're looking at markets, if you link up with the right realtor, obviously, they know the market. They know what's going to sell. They know what's going to be adding value. And and you know, my realtor was just phenomenal up there.

14:30 You know, I actually uh didn't get the property the first time. So, it was actually on the market for literally hours. the the previous folks had put the offer in, they they put in a full price offer and and it was off the market. That sale fell through fortunately, but my realtor knew their realtor and he reached out to her and said, "Hey, listen. This this fell through. It's going to be on the market again very briefly and and you know, I really lucked out with it because I don't think if that relationship was there with those two realtors, I wouldn't have gotten it." and and she really did have an eye for what the property I mean the property is just phenomenal and and you know I'm investing in it as I go along but you know the realtor also hooked me up with a cleaner up there also with a handyman so I mean you know especially when you're you're buying out of market where you don't live that realer is is is l the lynch pin you know they really are because they have so many things that they could bring to the table on on you know what you're trying to achieve. No, 100%. Love love love everything that you just said there. Especially if you're purchasing, you know, it takes like it pays dividends to do the research up front because not all realtors are created equal. Like I've worked with so many in in the past and there's a lot of bad ones, but there's like a handful of good ones in every single market that you have to go after. And it's not just whoever sells the most real estate, right? It's the people that, you know, in this case, right, someone that has experience in short-term rentals that understands the vision of what you're looking for and they just get after it.

15:47 You know, without that relationship, you know, you wouldn't have the property you have currently. you wouldn't have the team members in place. Like there's so many different things that fall into it when you find a good realtor. I mean, that's, you know, paramount. So, love that you uh, you know, made that. So, with this property, you know, I've seen it. It's awesome. So, I know you said it's roughly around 90K gross. Uh, what does the cash look like? Everyone always likes to ask. So, what what are we looking at cash flow wise after all expenses? Yeah, I'm I'm on average around 2500 a month, you know, and again, that's me putting a good amount back in to just buy stuff and and, you know, make upgrades to the property. But then you you add in the the you know the the tax savings and the other things and I mean if you look at the pro form over 5 years I mean it's it's performing and will perform based on that so much better than anything else you could put your money into honestly. It really is. Um and and the added benefit again from the ownership model is I go I've been up there four times already with my family and and you know so we we're making great memories up there and that's my whole plan is is to buy properties where not only obviously I can make memories there but I can share that with others that can go up and and and enjoy that as well. It's like a win-win, right? You know, I mean, they can they can enjoy it and they they pay me for it and, you know, that helps me to reduce the the cost and, you know, rinse and repeat, right? And then I can enhance the the experience and get more people in. So, it's it's really I've really enjoyed the

17:04 process and it is a journey. It's not a destination because every day is um is different and you know, it is stressful. For anybody that goes into this, they need to understand that there is stress. Um, you know, especially when you first start out and you don't know if if people are going to book and but it's it's literally it's kind of addicting though, you know, once you start getting the the bookings and they start coming through and you're always looking at your phone and it's like you get this, you know, kind of like the social media rush, right? When somebody likes a post of yours, you get that same rush. So, it's it's really cool. And again, there's there's really nothing else out there that that can get you the benefits that you can get through through a short-term rental in my opinion. No, 100%. You know, I love what you said about, you know, because everyone has different goals. Some people just want to make as much money as possible. You know, a cool thing about short-term rentals is that you can choose where your properties are. And if you like love to vacation there, like you said, create memories with your family knowing that you're getting paid to go on that vacation. Like, there's no better feeling than that. You know, me and my family, we took a trip to one of our cabins. You know, I think it was a couple years ago at this point. You know, we had our family there. Great, you know, great vacation, great memories that we shared. And, you know, in the back of my mind, I'm like, we're getting paid to like literally vacation here, which is awesome. And so, that's definitely an added perk of, you know, these short-term rentals. So, let's kind of shift gears a little bit. So, you know, from the next 6 to 12 months, you know, from your, you know, current portfolio. I know you're saying you're trying to continue to, you know, add back and, you know, improve your current

18:20 property, but where do you want to be here in like the next 6 to 12 months? Yeah, I mean, I I'd like to be, you know, I I think I have my next market pretty much lined up. So, I'd like to be, you know, actually visiting that market a little bit more. And, uh, I do have a realtor in that market that I like. So, it's it's really probably, you know, and again, a lot of things depend on what happens with with rates and everything else, but my my goal is to have, you know, my second property within the next 2 to 3 years and then, you know, obviously accelerate that as I move on. You know, maybe get more properties, you know, every every 2 to 3 years and just, you know, basically get to something around 5 to 10 properties. I don't want to be too much. Um, and and you know, really the cool thing about this, Preston, I know you have a little little boy, a little son, is, you know, your family can learn how to run a business, too. I mean, there's so many different assets of what we do, cash flow, and and, you know, real estate transactions and marketing, social media. I mean, it it it's really a tremendous way for kids to learn, your family to learn, and ultimately, you know, hopefully take on the business, and those assets will be in your family forever. That's the really cool thing from my perspective because you know we know in school right now they don't teach anything about finance unfortunately to kids and there's so many lessons that you can learn bas basically learning how to run a business from the ground up and you could be as hands-on or as hands off as you want to be and you know kind of right now I'm in

19:38 transition I'm transitioning away from my current management company because I felt like I was I wasn't as hands-on as I needed to be and honestly I needed to learn more about how it all works. So I'm kind of taking a step back. I'm going to get a little bit more involved so I know exactly all the moving parts. You know, really when I first started, I just wanted to get it on the market, start getting that cash flow coming in, but now that I know that, you know, the propertyy's going to perform, I could kind of step back and and really look at, you know, the process and and tweak it and really understand the nuts and bolts. And, you know, the property managers, you know, obviously there are some good ones out there, too, but they do take a significant chunk of your your income, right? So, that's something I preach. um you know, hire your virtual assistants, train them, and you can literally do the same thing if not better than what the property management companies can do at a fraction of the cost. So, we'll we'll get you there.

20:26 We'll we'll get you there, Chad. Yep. Crawl, walk, run, right? Uh all right. So, I mean, awesome conversation. You know, this has been, you know, great episode. So, before we know we hop off, thanks for the time again as well. You know, what would you say to someone that's, you know, considering wanting to start their own, you know, entrepreneurship journey or just, you know, short-term rental journey in general? Yeah, I would say, you know, invest in yourself, learn, you know, you know, make sure you do the homework and take the jump, you know, take the leap, you know, because you'll be surprised. You'll be surprised of what you can do. You'll be surprised what you can accomplish and just you just got to do it sometimes. Awesome, man. All right. Again, appreciate the time, Chad. Hope you have a great Friday and uh we'll talk to you soon. Thanks a lot, Preston. Love what you're doing, man. And a quick plug for my property. Anybody that wants to book Camp Manity, go to www.campmanity.net and we'll get you a nice discount for D. Awesome property. So, we'll definitely uh send me the link and we'll Yep. We'll plug it on the channels here. Awesome.

21:17 Thanks, Preston.