How Much Do Short Term Rentals Make in Blue Ridge? (2025 Income Analysis for Cabin Investors)

Yok Re [00:00:03]:
Welcome to the Short Term show from Blue Ridge, Georgia. We will cover everything you need to know, including buying, holding, managing from a distance, raising rents, renovating, and how to rent it when you are not using your very own vacation home in the North Georgia mountains. For more information on current purchase prices and income data, please visit theshortermshop.com welcome to the Short Term Show Special episodes from Blue Ridge.

Avery [00:00:44]:
Hey guys, welcome back to another episode of the Short Term show special episode series, this time on Blue Ridge, Georgia. We have a pretty cool cast of characters here today Also, by the way, I’m Avery. Carl Luke’s been doing all the other episodes on Blue Ridge. I’m going to take over the numbers episode. Cool cast of characters here today including, including myself that are going to talk to you about the numbers in Blue Ridge. So when we say numbers we are talking about income only right now. We have expenses in a later episode. Actually the episode directly after this.

Avery [00:01:16]:
So stay tuned for that. But today we’re just talking about numbers and performance. So the first guest that I would like to introduce is Yok Ray Yak. Do you want to introduce yourself really quick?

Yok Re [00:01:26]:
Yeah, I’m Yok. I’m our, I guess I would say I’m our short term shop rep in North Georgia. Been in the Tom. The North Georgia area for just about eight years now. Absolutely love it. I feel spoiled and blessed at the same time to be in this place and hopefully kind of share the knowledge and, and share what we have to offer with all of our listeners and the rest of the people that want to own up here because it is a special place to be.

Avery [00:01:50]:
All right, and next we have Erica Mueller. Erica, do you want to introduce yourself really quick?

Erica Muller [00:01:55]:
Hi everyone, I’m Erica Mueller. I’m a data scientist and I’ve been a realtor for 21 years. Got licensed at 18. Been working in real estate ever since. Strictly on investment properties. Also a real estate investor. I’m the founder at Rolio. We do really cool stuff with data and short term rentals for agents.

Erica Muller [00:02:12]:
So excited to be here today, Avery. Thanks for having me.

Avery [00:02:15]:
Thank you so much for coming. So I’m really excited to hear what, what your data says. So I guess we’ll just go ahead and start with. Well, actually, let’s start with I know I told you guys we’re going to do this differently, but I’m going to switch it up on you again. So let’s start with a little bit about so you guys can kind of understand what Erica and Yak and I are going to be talking about. Let’s with a few, just vocabulary words and definitions of a few metrics for analyzing short term rentals that you might hear. You might hear words like income, gross income. So, Erica, when you say gross income, does that mean true gross or is that minus a couple of things.

Erica Muller [00:02:51]:
When I say gross income, it means just off the top, what it brings in. Minus nothing.

Avery [00:02:54]:
All right, minus nothing. And I think that’s really important because that is what gross means. But different sources will say gross is the true income, minus cleaning fees or minus taxes or something. And it really, it should mean the true gross. Anything else would not be the definition of gross. So next you might hear the word cash on cash return. So that’s a metric that a lot of people use to analyze short term rentals. And a lot of them there, there’s different.

Avery [00:03:21]:
There’s not really a rule of thumb anymore. It used to be there are some people that have said 30%. We used to say 20. But now you’re kind of looking for opportunity. The opportunity to get a property to that cash on cash return number that you’re looking for. It may be just laying around performing like that, but you’re looking for the opportunity of, okay, if I buy this property at this price, how high can I get that cash on cash return? Maybe there’s the opportunity to do a kitchen update, or adding amenities or adding another bedroom, things like that. So things that you can do to improve the property. Sometimes you can boost it just by managing the property better than the previous manager, having better photos, better listing, etc.

Avery [00:04:03]:
But you do have to actually manage it. You can’t just buy somebody else’s property and say, oh, I’m going to be a better manager than them and just slap it up and then expect to do better. So you’re looking for the opportunity. You might also hear the word cap rate. Erica, do you want to give the definition of cap rate for me?

Erica Muller [00:04:19]:
Yeah. I mean, cap rate is a very basic formula used to analyze all real estate across the board. It’s basically your noi divided by your property value. Your noi is your net operating income. That means it’s basically what’s left from your gross after you subtract everything that you have as an expense except your mortgage. So you would then subtract your mortgage from your noi after that, but that’s not your cap rate. So does that make sense, Avery?

Avery [00:04:43]:
Yes, absolutely. All right, cool. So I guess let’s just dive right into it. So you’ve taken a look at the data for this market. Do you want to kind of just give us a synopsis of what you found and then I’ll ask you questions off of that?

Erica Muller [00:04:55]:
Yeah, I mean, what I, what I found is that eight bedrooms are still killing it in this market and they’re actually killing it so well compared to what I expected them to be doing in today’s purchase prices. So even with today’s purchase prices, they’re still knocking it out of the park that you could actually get a loan at today’s rate and still make money on these eight bedrooms, according to the data, which I thought was incredible because we don’t see that in a lot of markets right now.

Avery [00:05:21]:
Okay. For eight bedrooms.

Erica Muller [00:05:22]:
Yep. Eight bedrooms.

Avery [00:05:24]:
Seven.

Erica Muller [00:05:25]:
Seven bedrooms. So here’s what’s interesting, is that it kind of trails up an income. Like you have a decent amount of income in all bedroom sizes, but it starts to really pick up at the six bedroom point. So once you jump from a five to a six, you see a massive increase in income. A five, you’re looking at 70,000 a year in income. And I’m talking about single family homes, not condos, not townhouses. But on single families, you’re looking at 70,000 a year in gross income. On a 5, you go to a 6, you’re at 121,000 a year, then you go to a 7, you’re at 180, then you go to an 8, you’re jumping to 485,000 average.

Erica Muller [00:06:01]:
It’s a huge jump. Now purchase price. Now this is, you know, if you can afford to buy that, your average purchase price is around 1.9 million. But if you have the price to pay for that price tag, you’re looking at a large return right there. Let’s just say you didn’t even have enough to spend on an eight bedroom and buy it like that. You could probably buy a 6 and convert it to an 8. So imagine spending less on a 6, which would put you right around in today’s market 1.4, converting that to an 8. And now you’re getting the revenue of an 8.

Erica Muller [00:06:35]:
To me, that would be a huge play in this market that you really don’t see in a lot of markets right now in the luxury home side.

Avery [00:06:41]:
Interesting. So you could the eight. Let’s. Okay, let’s say you’re on a budget in this market. You’re on a under million dollar budget. Is there a, a particular size that you that would perform best for more of a budget opportunity?

Erica Muller [00:06:58]:
So under a million dollar budget, on average and of course, yak, you can maybe like speak to this, but on our data it puts you about a four bedroom. So where I see the opportunity there is to focus then on getting what you can for under a million and try to get, add as many bedrooms as you can to it. Because you do see a massive jump also from the four to the five. So if you got a four year and you can add on one bedroom by converting the garage or, or however you’re going to do it, your revenue jumps up to about 70,000. So that’s a, that’s a sizable amount of income. That’s like $24,000 more a year just from adding a bedroom. So that’s how I would run that play in Blue Ridge if I had under a million dollars to spend. One thing you don’t want to do is there’s the three bedrooms.

Erica Muller [00:07:43]:
So the most saturated product in the whole market is a three bedroom. If you buy a three bedroom, you’re competing with 37% of the other houses out there. And nobody wants to do that. Right. No one wants to be the most competitive product. So I would say the play here to stay under a million is to get into a four or get into a three and make it a four. But get out of that three bedroom category, get from like a four above. And then that’s where you start to see your, your revenue increase.

Yok Re [00:08:09]:
Yuck.

Avery [00:08:10]:
Are you seeing that on your end? Because there’s times that we, when we have data people on that, the agent stuff or the agent side of things actually sees the same thing. And then there’s certain times that it’s kind of like with the enemy method where the data will say one thing, but because of the area or something, it might not actually be the exact right thing to buy. There might be some caveats. So what do you see on the agent side?

Yok Re [00:08:34]:
Yeah, so some of the stuff that Erica’s saying it 100% agree with. Right. Three bedrooms is the most competitive space. No doubt about it. It’s, you know, three threes. Three twos are our bread and butter. It’s what we have the most of. She was mentioning, you know, these, these really big cabins.

Yok Re [00:08:53]:
I’ll be honest with you, I’ve only sold one. You know, they, they do not hit the market that often. And when they do, they are, you know, I, I hate to say it, but if somebody’s going to spend 1.8, they want to spend it in the Smokies and not in Blue Ridge. I mean, it’s just a reality. So you know, they are out there. But again, I think I’ve sold. Avery sold one. I think I’ve sold a seven bedroom swimming pool.

Yok Re [00:09:19]:
It wasn’t even a cabin, but they’re killing it to the point. So the data kind of plays that out. I wish I had more people looking for six, seven and eight.

Avery [00:09:28]:
Well, maybe they don’t know to look for that because I think you’re right that a lot of people, they say, oh, I can’t buy in the Smokies right now, so let me scoot over and buy in Blue Ridge. But then if they have the budget, a lot of times, since the Smokies is more of like the popular brand name market, they scoot back over to the Smokies. But I have not seen an eight bedroom in the Smokies make that much money that, that Erica’s talking about. So maybe it’s just a scenario where people do that because they think, oh, Smokies, that’s what I’m supposed to do. But the opportunity at that price might actually be in Blue Ridge.

Yok Re [00:10:02]:
Yeah, I mean, you’re in the six, seven and eight bedrooms. You’re in the 1% of 1% of cabins. You know what I mean? Like, they are just very few and far in between.

Erica Muller [00:10:10]:
I say there’s actually a few of them. And I’ll tell you exactly where they are. Because just to say what you know, to jump on to what you’re saying, if you go along the Toccoa river, right. Just north, it’s kind of like northwest of the 76 along the Toa river, there’s three of them, three, eight bedrooms. Killing it right now. And they’re all along the river and one of them is kind of like further down the street. So if you were going to do that play and someone was coming to you with $2 million and wanted to get one of those, because it’s like Avery said, you don’t know that you could put your $2 million there until you have the data to support that. Now, you know that’s exactly where it would be.

Erica Muller [00:10:46]:
It would be right along the Toccoa River. So when you’re spending that kind of money, being on that river is probably going to be critical to being a high earner for sure.

Avery [00:10:54]:
Interesting. All right, so that, I mean, I’ve already learned something because that’s something that I think a lot of people do if they think, well, I have this huge budget, let me just buy in this super brand name market, blue chip market, for lack of a better word, when really the opportunity might be here. And okay, so under a million, the opportunities in four bedrooms, turning them into.

Erica Muller [00:11:15]:
A, if you turn them into a 5, your revenue increases by about 24,000 a year. The cost of converting the garage could be pretty minimal. You’re going to add about 24,000 in revenue to your property just by adding on that bedroom.

Yok Re [00:11:29]:
Let me add, let me throw on a little bit of a wet blanket here. The, the, the only drawback we have now is I believe is as of November 1st, I think it was two Wednesdays ago, we, they did layer on some short term rental regulations here. And you have to be cognizant. When we’re purchasing a house, your occupancy rate is going to be based on your septic system. So just converting, so just doing the conversion may not be enough. You may also have to do the work from a septic standpoint to get that figured out.

Erica Muller [00:12:05]:
So again, that’s excellent feedback.

Yok Re [00:12:07]:
Yeah.

Avery [00:12:08]:
For that.

Yok Re [00:12:09]:
Yeah. So, you know, they’re, they’ve basically come in and said, hey, and Avery, you’re in Tennessee. So you see, or we’re in Tennessee. So you, you know, this play there is the five bedroom house that was originally, you know, a two, two that’s now a five, three sitting on a two bedroom septic. The, basically they just said, hey, we’re not going to do that anymore. And long story short, there’s been a couple instances where these five bedroom houses on two bedroom houses have had the septic blow up and the neighbors have to smell it for two weeks. And they basically said we’re, we’re going to set down some regulations. It’s not a bad thing.

Yok Re [00:12:45]:
Like I don’t want people to think that that’s a bad thing. It’s here to protect, host and protect everybody in the community and make it a safer environment for everybody. So again, you know, Blue Ridge, I tell people Blue Ridge really isn’t the place. You know, we don’t have a lot of honeymoon suites. You know, the one bedrooms we don’t have a ton of. And to your, you know, as we talked earlier, we don’t have a lot of these six, seven and eights. So you know, it really is about kind of family environment and all that and you know, mixed smaller families. But if you can get something that can host, like you said, these bigger groups, you certainly have something that’s unique because here unique sells, unique makes money.

Yok Re [00:13:25]:
And something that’s a little different than everybody else, you can, you can pretty much write your own check.

Erica Muller [00:13:29]:
And also, yuck, the data supports the event strategy for the eight bedrooms. Because if you go and you look at the top features of all the high performing eight bedrooms, you’re looking at all the other bedroom sizes. There may be 1% or less than 1% are suitable for events. When you look at the eight bedroom high earners, 14.2% of them are suitable for events. That’s an enormous increase in the amount of units used for events than all the other bedroom sizes. So perhaps there’s some kind of strategy here that you know and I, what I always do is when I see something like this and I find an interesting data point like this, I’ll go straight to the eight bedrooms and read the reviews and, and say what is going on here? I want to see what people are saying. And a lot of times I’ll find that hey, we have family reunions, we’re hosting weddings here, we’re doing retreats and that kind of gives you a strategy like okay, hey, I’m going to go pick up this eight bedroom for 2 million, I’m going to turn it into an event friendly retreat spot and I’m going to kill it. Right.

Erica Muller [00:14:28]:
And no one else is doing that because you only have like less than 1% of the market, like you said, that’s actually executing that strategy. So in my opinion, everything you just said is accurate along with the whole event strategy.

Yok Re [00:14:40]:
Yeah, I try to tell people, you know, as your data points out, grandma’s big brown three bedroom, three bathroom cabin, it’s, it’s kind of, you either hit a single with it or you hit a home run. You know, I’m not going to call it boom or bust, it’s probably too strong. But you do have a large competition base when doing that. And, and if you are, you know, if you’re, if your budget is that south of 700,000, you know, if you are going to do the three bedroom, find something that’s unique. You really need to chase something with a view if you can afford it.

Erica Muller [00:15:10]:
Yeah. And I noticed another interesting point was that people, I think a lot of people try to go for like the downtown area of Blue Ridge too. But when I look at the high earners and we kind of isolate them to one to the locations of where they’re at. There are some down there in the downtown area, mostly condo, not as many houses, but all of the high earning houses are just to the southwest of that. There’s like a mountain range there. Yuck. I don’t know if you know what it’s called. I don’t really know the mountains there, but it looks like Trammel Mountain, Baloo Mill, that whole area.

Erica Muller [00:15:41]:
There’s a ton of high earners all nestled along in those mountains right there. Like a ton of. They’re just like west of the 76.

Yok Re [00:15:49]:
So we have to be careful. They are not issuing any more short term rental licenses inside the city limits. So all the things in town, those have been grandfathered years and years and years ago. So they are not.

Erica Muller [00:16:01]:
That license, like if you buy it, can you get it from the owner and transfer to.

Yok Re [00:16:04]:
No, no, my, my understanding is not. Now with that being said, a lot of those that are managed by management companies, they never ask you for a license and people are just like, screw it. You know, do it anyway. Now if we get a new tax commissioner, can they start putting the kibosh on that? I guess. But again that’s, that’s not a place where I’m gonna, I’m gonna steer my clients. I’m gonna say, hey, let’s, let’s get something where you’re not going to be impacted by, by regulations and, and everything. Just, you know, not an area, you know, don’t want to, don’t want to dance in the gray area.

Erica Muller [00:16:35]:
It sounds like that area just southwest of it then might be an option. And also too yuck. There’s an area off Lake Blue Ridge, very specific spot. It’s just one small cluster. There’s nothing around everywhere else. But there’s like a street called Aska Road and it has like this road that goes off on it. And if you go down there towards like the south part of the lake on Lake Blue Ridge, there’s a whole bunch of these top earners right on this one mountain area by the lake. So I think that’s those views you’re talking about is, you know, if you can get down there, they have these gorgeous views of the lake and it’s really, it’s really showing in the data that it’s paying off for them.

Yok Re [00:17:09]:
It definitely can be all down Aska. I wouldn’t call it a street. It’s a two lane highway and it’s, you know, can, can be challenging for people at night because a lot of wildlife and all that. It’s, it’s a really cool place to be. It’s, it’s feels a little more remote than the rest of Blue Ridge, but it is where kind of the, you know, people that are looking for outdoor adventure type stuff that’s called the Aska adventure area down in there. There can be, you know, There’s a lot of, to your point, a lot of great views and, and is a great place to be.

Erica Muller [00:17:39]:
Yeah, it looks like there’s a lot of activity over there and it’s all like high performance activity, which is interesting. So let me ask you this about, about pricing, if that’s okay. So we noticed that pricing takes a big jump when you go from a two bedroom to a three bedroom. We go from like two bedrooms in the four hundreds and then the three bedroom bedrooms are showing in the seven hundreds. Are you able to go out there if someone wanted a four bedroom and acquire it for them for less than what the average prices are right now? Like do you have off market inventory, stuff like that?

Yok Re [00:18:09]:
There’s not really anything off market, to be honest with you. Because look, everybody knows what they’re sitting on. I tell everybody, if you’re trying to sell, you’re trying to sell a, a vintage car, are you going to take it to Mecham auction or are you going to take it, you know, try to sell it in your front yard? You know, you want, you want as many people looking at it as possible. And right now that’s just it. I mean nobody, you know, this isn’t five years ago where people don’t know what they have. Everybody wants their property to get as much viewership as possible. And to be honest with you, all the agents up here, absolute sharks. You know, even though we are a sleepy little town, this is where a lot of very successful real estate agents from metro Atlanta come to retire and they, they only semi retire, they keep doing real estate and, and again they’re urging all their people, let’s, let’s get this thing on the market, get you as much money as possible.

Yok Re [00:19:01]:
So off market stuff, very, very few and far between.

Erica Muller [00:19:04]:
Interesting, interesting.

Avery [00:19:07]:
Okay, Erica, so you’ve got some data up and we talked about the higher occupancy properties being a great opportunity in this market. But what about for people who want to get into Blue Ridge on a low? What are we kind of looking at there in terms of best options for them?

Erica Muller [00:19:21]:
Yeah, so there’s a really clear strategy on that here and it’s pretty simple. We’re going to look at where all the high earning studios and one bedrooms are because there’s a lot of potential right now with the studios and the one bedrooms and even your twos. And so we’re going to look at where you can do well with the middle, the highs and then we’re going to show you how to get into a low for the Same for less money than you’re going to get into a middle or a high. But do the same strategy. So I can see here on my map I’ve got some high and middle high earners. They’re in blue, the middle high earners and green are the highs. And this is the downtown Blue Ridge area. But see all these red dots when you see these red dots.

Erica Muller [00:19:58]:
And for those of you listening, I’m looking at a map right now and I’m hovering over downtown Blue Ridge. And what I’m showing is that there are markets where high earners are already exist on the studios, one bedrooms and two bedrooms. But there’s also some that are currently underperformers in that same location. So what that tells us is that this location is great. This location has opportunity. However, there are some poorly managed properties there because if it was just a bad location, you wouldn’t see any top earners in this location. But if you see them there and you also see some bottom earners, it means that those people are struggling. They’re either struggling with management, they’re struggling on how to do it themselves, they haven’t updated it.

Erica Muller [00:20:38]:
The interiors are awful. I don’t know, but there’s a number, a number of reasons why they could be struggling.

Avery [00:20:44]:
Scoot out just a little bit because I see a lot of what looks like underperformers. So outside of the city limits, inside city limits is a little hairy right now because they’re, they don’t really want short term rentals inside. But there’s definitely some clusters outside like further out and some top performers too. And that, what does that say? Burnet Lucius Burnett.

Erica Muller [00:21:05]:
Yeah. So right here in this Burnett Mountain, there’s like this mountain right off of Burnett Boardtown Road in between ADP APD highway and Boardtown Road. There’s a, it looks like a mountain and there’s a town called Burnett and it’s to the, it’s to the east of it. There is a bunch of middle high and high earners here and then surrounded by the, surrounded around that are a bunch of lower earners. And so to your point, Avery, if we need to get out of the downtown area, this would be a great location to kind of focus on for that entry level. Under 300, under under 400 price point. If you want to get into the Blue Ridge market and you want to be in a proven area that we know you can become a top earner, that would be a great one. There’s also others spread out around here.

Erica Muller [00:21:48]:
Like there’s a little Cluster down here under Glamp Blue Ridge. We’ve got some activity going on in this whole little like campground area. It looks like there’s some condo or studio activity there on a mountain. So yes, there is a strategy here and the strategy would be find what’s working for other people that are doing it right and then follow along and try to pick up something that someone wants to get out of. Those would be my location choices and my strategy for this market.

Avery [00:22:14]:
Yeah, so what I’m seeing is like there’s underperforming one bedrooms kind of all over the area. So it kind of seems like there’s opportunity really anywhere, location wise. Of course you want to have, you know, the best amenities, best views if you can get them, waterfront if you can get it, all that. But I really, I love a good studio or one bedroom because I think they’re so overlooked by investors because everybody’s like, I want to get as big as I can, but I love my studio and my one bedroom cabin. They do exactly what I need them to do without, you know, getting all in the mix of fighting with everybody over four and five bedroom properties.

Erica Muller [00:22:50]:
So yeah, like look at this one, Avery. Can you see my screen? This is an underperforming one bedroom. There’s no way that there’s. This property isn’t going to be a top earner or a higher earner. If someone got a hold of this. Look at that. Right on the trout stream. Right on tub and the look at.

Erica Muller [00:23:07]:
But look at it inside. I mean it daunting to look at. And so the photos are awful. The interior is outdated. If someone got a hold of this and they just updated it and they just made and they got better photos alone, I think would totally change the game on this. The locations aren’t the problem. It’s that there’s a lot of people here that yeah, bad management, bad advice. So.

Erica Muller [00:23:30]:
So you’re right, there’s a lot of opportunity, especially in areas that are also proven with top earners. Even the ones that aren’t. What we’re seeing is that there’s probably just no top earners there because people aren’t putting in the effort. And if someone comes in, picks up these studios or one bedrooms and puts in the effort, I mean, I don’t see how you could go wrong. So yeah, that’s overall my opinion on this market. I mean even this one is so beautiful that I’m seeing this cabin on this river. My gosh, this is gorgeous issue. It’s dark, it’s dreary.

Erica Muller [00:24:00]:
The pictures aren’t so great. Yes, it’s clean, but sometimes, you know, people. People need to feel like there’s light in there. And a lot of these are just super dark because they’ve done an overkill on wood. So just some updating. And Avery, you’ve got, you’ve got all the suggestions for this market, but we don’t have a problem here with these properties not being good opportunities. We have a problem here with people not managing correctly, therefore making it look like there’s just so many bottom earners because the market’s bad. But it’s not bad.

Erica Muller [00:24:29]:
It’s a great market. It’s just, we have an issue with owners, and that’s common in a lot of markets that are longer. They’ve been around longer than newer markets. So we see that in Orlando too. We see that in other markets that are traditional vacation areas. We’ve had people vacationing there for a very long time, and these owners just aren’t motivated to do much. And that’s what you’ve got here. So this is kind of cool, too.

Avery [00:24:53]:
Awesome. Well, thanks. All right, so. Well, let’s, let’s talk about. So we kind of talked about areas. Are there any other areas, Erica, that kind of jumped out at you as having a lot of high earners and places you might want to be?

Erica Muller [00:25:03]:
Yeah. So I was kind of trying to stick just to this smaller downtown Blue Ridge and surrounding area. But if you keep going a little further south down Aska, past the first one by the greens mill area, there’s like a small, and I don’t know, it’s called Will Scott. It’s still in Blue Ridge, but it’s kind of out into the mountain area as the lake turns into kind of a river. Just south of Will Scott on the other side of the river, I’m seeing a lot of activity over there. There’s a. There’s like a glamping place, but there’s a lot of short. There’s a lot of high earners in.

Erica Muller [00:25:35]:
In that area. Do you know what the Will Scott is area is? Yog that whole area.

Yok Re [00:25:40]:
I know of it. Again, you start getting into that super remote stuff, and sometimes it’s just hard to manage, you know, because of its distance from town. You have people, you know, you’re. You’re 30, 40 minutes from downtown. You’re 30, 40 minutes From Walmart and restaurants. You may not have great cell phone service. So again, there could be some great opportunities out there. But again, it kind of becomes harder to manage if you Are the out of state or and you know, aren’t willing, you can’t stay on top of it.

Yok Re [00:26:13]:
Right. Because it’s just hard to get cleaning crews out there. You know what I mean? Some of those places are hard. Including the area like if you look directly west of town in the Cassius Valley, I know there’s high earners out there. Sometimes it’s hard to get cleaning crews out there for a turn because they don’t want to do, you know, 45 minutes. If they live on the other side of Blue Ridge, they don’t want to have to do a 45 minute drive and half of it be on gravel and it just can be tough. So I know there’s earners out there, but it’s a little bit harder to align your services to make it work. You know, it may take a little more massaging from the host area and building up your team and of course that’s something we’ll help you with.

Yok Re [00:26:53]:
But it, but it is harder to kind of put those pieces together.

Erica Muller [00:26:55]:
Yeah, that makes a lot of sense. I recently was up there a little further north, stayed in a short term rental. It was disgusting. They couldn’t get a good cleaner and it really did affect the stay and I won’t go back now. One thing I like to do too is I look at the high earners but then I also like to turn on all the low earners that are, that are also on the same app. So I can see in contrast where’s all the low earners to the high earners. So we know kind of the areas that might not be performing as well and we can maybe get a strategy around finding out why. And then if there is opportunity there with high earners, we could understand how to convert those short, those bottom earners into top earners.

Erica Muller [00:27:30]:
So one area that jumped out at me right away where there’s maybe four top earners and there’s probably like 15 or 20 bottom earners is if you go down the APD highway south from downtown Blue Ridge and you keep going south right before you get to Ellijay, it’s north of Ellijay on the way to Blue Ridge. It’s called White Path, Norcutt. That area just to the west of that, there’s a whole bunch of low earners. And it’s weird because there’s a, there’s a river, the Ellaj river that goes through there. Do you have any idea why we might only have three or four high earners there, but a whole bunch of bottom Earners like what could be going on there?

Yok Re [00:28:05]:
Older cabins.

Erica Muller [00:28:06]:
Okay.

Yok Re [00:28:07]:
You know, a lot of, a lot of older properties in that area. Not many new properties. White Path, you know, poor cell phone service down there. I’ll be honest, for whatever reason, it’s not, it’s not super remote, but there’s poor cell service and there’s just not a lot in there. Also down White Path we have the golf course. So you know, they’re not allowing, you know, there’s not allowing a lot of rentals. Also. There’s one of them, there’s Buckhorn Estates that it’s on the golf course.

Yok Re [00:28:35]:
They allow short term rentals, but it’s very restricted to the sense of you’re not able to really do it. There’s a lot of administrative work. You have to pay the HOA certain amount of money for the rental. So, you know, they, they just don’t rent as frequently.

Erica Muller [00:28:51]:
So what’s interesting is I’ve got two top earners next to each other and then up the street I’ve got some bottom earners. Do you think there’s opportunity to pick up at a better price some of these bottom earners that might be in a good location but for whatever reason they’re missing the mark and convert them into a top earner at a better price than us trying to go out and acquire a top earner right now, for what it’s worth in today’s market with all of its revenue coming in.

Yok Re [00:29:15]:
It’s a great question and, and it’s one, you know, I have with a lot of clients is do I, do I want to do a quote unquote, some sort of rehab? Right. I’m not getting the perfect property. What is the value proposition? How can I go in to inject some money into this property and bring it up to where it is? You know, it really is something. You have to look at these properties at an individual basis because it’s. This isn’t like Tennessee or Orlando where a builder comes in and does an 85 home development. You know, a builder may come in and build three homes. And so every opportunity very much is unique. And it is just something that I have to, I tell my clients we have to look at them on a case by case basis.

Yok Re [00:29:56]:
Like, like you said, is there, is there a garage we can turn into something else?

Erica Muller [00:30:01]:
Another point that I’m noticing that might give an uptick in revenue, and this is an interesting one, is pet friendly. Because what I’m seeing here is that when you look at just the regular earners and the bottom earners, they’re not very pet friendly. But when I switch to the top earners, I’m noticing a big uptick of around 50% being pet friendly. And so I don’t know why more people wouldn’t just do that if that’s, that’s such a simple thing to do, charging a pet deposit. But that seems to be increasing the revenue as well on some of these top earners. As you know, an actual point with a lot of validity here.

Yok Re [00:30:35]:
That’s, that’s a great point. That is such a personal question, you know what I mean? For, for a host, you know, do you want pets? Some people are adamant. They’re like, hey, my kids have allergies, I don’t want pets there. Some people are wondering is it worth it? You know, are they, are the pets going to tear up my house? You know it. And some people don’t care, you know. So I’m glad to know that you give me the data on the pets again. You said 50%. What did that data sound like again?

Erica Muller [00:30:59]:
Yep. In the smaller ones, if 50% of the high earners were pet friendly and then when you isolated down to the low earners, it’s a much lower number. So we see a huge increase with, we look for those patterns of like, why would this top earner be a top earner? And to do that we’re comparing it to the features of the low earners and there’s more pet friendly in the top earners than the bottom earners. And that makes sense to me. In this market people go there, they hike, they bring their animals. This is an outdoorsy market, so people travel with their pets. Another point I wanted to ask you about that I noticed is in the high earners, it looks like 73% of them are managed by a manager. Only 26% of them are owner managed.

Erica Muller [00:31:37]:
I hear so many people that are always like, oh, I’m going to owner manage and I’m going to be more successful, save money. But in this market that’s not a solid strategy. According to the data, you’re actually more successful if you hire a good manager than if you take it on yourself. Do you have any idea why even like 26% of these people would even try to attempt to self manage?

Yok Re [00:31:56]:
Well, I think, I think the biggest issue is not that the management companies do a great job. I don’t really think they do. I just think our market is not as sophisticated as a Smokies, as Orlando, as Destin and the self managers aren’t really elite. You know, we have a lot of people, you know, just, you know, pulling back the curtain here. A lot of people that are coming into Blue Ridge are people that couldn’t afford the Smoky Mountains. Okay. So they come in here, this is their first purchase. They, they aren’t well seasoned hosts.

Yok Re [00:32:30]:
So because of that, you know, I think that’s, I think that’s what the data is showing. More so than management companies do a better job. I would say maybe on the whole, some management companies are able to do better than first time host, but generally speaking, the, our clients that we train with Avery and Carl’s help, they are able to do much better. No, but I’m being serious. You know, they’re able to do much better than these management companies are.

Erica Muller [00:32:56]:
Oh, that’s great. Yeah, because we did notice there wasn’t as many top earners that are self managed. So maybe some of those people that are using a manager that’s not so great with your help could actually do better if they switched over to self managing in this market.

Yok Re [00:33:10]:
They absolutely could. In a lot of these management companies, I mean you’re talking, they’re taking 30 to 33%, you know, right off the rip. So it’s not for a lot of people. That is your, you know, that’s your slice of the pie and you’re giving it away. But, you know, teach his own.

Erica Muller [00:33:24]:
Yeah. Interesting. My last thing I wanted to kind of bring out and talk about was condo versus townhouse. I noticed that we don’t have hardly any high earning condos here. It’s mostly, I mean, versus single family. Most of it’s single family. We, we don’t, we do have actually some townhouse activity, but it’s mostly going to be single family. Like do you recommend condo? Because in our data we’re not seeing that as being.

Yok Re [00:33:48]:
Yeah, not at all.

Erica Muller [00:33:49]:
Okay.

Yok Re [00:33:50]:
Data. Yeah, reality backs up that data. We don’t really have townhouses, houses, they are down, you know, in town. No real multiplexes. I would assume. If anything, I don’t know how you’re, you’re acquiring your data, but if anything shows up as a multiplex, a lot of times it’s, you know, it’s a two story house and they rent the top and the bottom and they have some sort of system. I know there, you know, there’s people with four bedrooms, they’ll, they’ll rent the bottom. You know, you have to pay extra to get the bottom that has the sauna and things like that.

Yok Re [00:34:22]:
Those may be populating your data as multiplexes but for the most part, yes, it’s. It’s single family homes and that’s it.

Erica Muller [00:34:30]:
Interesting. Great. Thanks, Avery. That’s all the big points I had that I wanted to drive down.

Avery [00:34:34]:
Yeah, I think all of that is really, really good information. I think my last question before we wrap up is, were there any amenities that stand out that you notice a lot of the high earners had or is it really just like a, you know, you need to be a modern cabin and be kind of unique like yo said.

Erica Muller [00:34:51]:
So I’ll first start with size and year built because that’s an, it’s not an amenity, but it’s a feature that people overlook. And I like to look at that with the high earners. So one thing that was interesting to me in that area was that most of these high earners were built around the year 2006. They’re not brand new, but they’re not really old. And so that kind of tells me that I don’t have to be building a brand new house to be a success, successful high earner in this market. I have opportunity here to buy something that’s a bit older, fix it up, renovate it, and still kill it in this market. Also, the square footage on average was about what I was noticing in those successful ones was anywhere from 3,700 square feet and larger. So when you’re looking at size, you also, if you’re acquiring, let’s say a five bedroom, you also don’t need to be buying, you know, a 5,000 square foot house.

Erica Muller [00:35:42]:
You can get away with 3030, 700. So those are the first two things that even though they’re not amenities I wanted to bring up and talk about. The other things were, I think, things you wouldn’t be surprised by, like hot tub, for example. Hot tub definitely makes a difference in this market. We see that most of the high earners, more than 50% of them, usually more than 60 or 70% of them in this data, have a hot tub. So that’s kind of something I would look at and say absolutely a necessity. I need to have that really interesting data point on the six bedrooms though. Like, none of these houses really have pools.

Erica Muller [00:36:17]:
But then when you get to the six bedroom, 18% of the high earning six bedrooms have a pool. And so when you go from like pretty much all of them having no pool to 18% of them having a pool, that’s a data point I pay attention to because I’m like, that’s a big leap. So that’s an interesting One, there is possibly a pool in the six bedrooms. I did mention the pet friendly, so that was something. And I did. We already talked about the events, so those are the ones that just kind of jumped out at me that I wanted to bring up to you all.

Yok Re [00:36:45]:
Interesting points and I’ll say this. With the age of the property, the, the more prevalent you get. Like you get into the three bedrooms, you know, the threes and the fours and the twos. I think it is imperative, I shouldn’t say imperative, depending on the price point. The newer the house, I tell all my clients, the newer the house, I’m not going to say the better, but I think you got a better chance to make more money because you know, a lot of young affluent families driving up from metro Atlanta, they want, they want new chic, sexy cabins and you know, the, the tired three bedroom cabins. You really have to go over the top with amenities and furnishings and decor to separate yourself from the rest of the pack there. So if you, if you, you know, nothing wrong with a three bedroom, but just be prepared to, you know, you’re going to need to be able to, and have the desire and resources to, to make the inside look like Joanna Gaines waved her magic wand and, you know, made it cool. To your point about the larger properties and swimming pool in general, I tell people we are not a swimming pool area.

Yok Re [00:37:46]:
You know, I’ve only sold one cabin over five bedrooms, one house over five bedrooms and it was a six bedroom and it did have a swimming pool. Okay. And they do really well there. I think there was something like 22 beds in it, you know, counting bunks and everything else. But yes, it did have hot tub and swimming pool. I think. Hot tub. You had said your data says, you know, 60, 70%.

Yok Re [00:38:09]:
I tell everybody you have to have a hot tub. It’s a non starter. Like if you want to find yourself in this, you know, above the 50 percentile of earners, you’re going to have to have a hot tub. I also tell everybody, you know, you need to have, you know, on the smaller properties you have to have some sort of secondary common area. You know, something you can turn into a game room or something like that where kids or whoever can hang out, where, you know, mom and dad, they, they, you know, they can, they can be upstairs on the hot tub drinking wine and the kids are down in the, in the game room entertaining themselves. You know, those are things in my opinion that are just must have.

Erica Muller [00:38:47]:
Yeah. And our data backs all that up. So I’m happy to hear that awesome.

Avery [00:38:51]:
Well, cool. Anything else related to data performance that you think our listeners could benefit from hearing? Like maybe anything that we didn’t touch on before we wrap up, you know.

Erica Muller [00:39:00]:
Outside of, you know, cash on cash, cap rate, those things? Not really. I think we touched on so many valuable points. I mean my big takeaway after digging into the data with Yaak and hearing his perspective, making sense of it is that there’s a lot of opportunity in this market to pick up properties that could be a renovation opportunity to bring some cash into this, fix it up, make it pristine, brand new to attract those higher end families traveling from, like you said, the Atlanta area that are willing to pay more. And you could probably get a good opportunity to purchase those if they’re older and kind of beat down. I would do it. I would execute it in a way where you’re buying it in the location that we know is going to be in a top earner location. So even if that property is a bottom earner, we can invest that money into fixing it up to make it become that top earner. And we know now what those features are.

Erica Muller [00:39:48]:
We know we want to kind of gear it towards events if it’s a bigger home, pet friendly, possibly, things like that. So in my mind, if I was going to go invest in Blue Ridge after this discussion, my play personally would probably be to pick up as small of a property as I can figure out if I can get enough septic permits to make, to add as many bedrooms as I could, make it beautiful inside and attract those events and retreats. That’s my personal like take away from this. If I was going to go into the Blue Ridge market. But I mean there’s so many takeaways from this. You could execute so many different strategies in this market. It’s a cool market.

Yok Re [00:40:21]:
Yeah, I’ll leave it Avery with this. And it’s the same thing I told Luke is unique here sells. And when I mean sells, I mean, you know, for renters, everybody’s looking for unique. You need to have a hook. Whether it’s, you know, you’re the, the big house that can, you know, accommodate these, these corporate retreats or whatever you want to call it, you know, the six, seven and eights. And if you don’t have the two million dollar budget to do that, you know, and you’re looking at that sub 750, that, that sub 600,000. If you’re going to pick that two and the three, then how are you going to be unique there? You need to have unique amenities Decor, everything else. You know, you’re gonna have to give something, give people something that your neighbors aren’t willing to do.

Erica Muller [00:41:01]:
Let dogs in. That’s.

Yok Re [00:41:02]:
Yeah, There you go. I love to hear that. That was an interesting point.

Erica Muller [00:41:06]:
Yeah. Put up a fence, put. Take out all the carpet, and there you go. You’re. You’re on your way without having to spend a ton of money.

Yok Re [00:41:11]:
There you go.

Avery [00:41:12]:
All right, well, guys, thank you so much. So, Erica, if the listeners want to follow you, learn more about you, where can they do that?

Erica Muller [00:41:19]:
Yeah, so they can. We have. Brolio.com is our website, v r O-L-I o dot com. But honestly, we’re a B2B, so if they want to acquire our data or learn more about our tool, they would connect with you, Avery, to get that from you. So anyone that’s interested in that, just definitely connect with Avery and we can definitely make sure we get that in their hands.

Avery [00:41:40]:
Awesome. And if you guys are ready to buy a short term rental in the Blue Ridge area with Yock, you can email us at agents the shorttermshop.com and we will get you connected with him. Or if you just want to hang out with us and talk more about short term rentals, you can do that by joining our Facebook group. It’s the same title as my book behind me. It’s called Short term rental, Long term wealth. Or every Thursday, we have a live Q A where you can ask us any questions you want about short term rental investing and you can sign up for that@strquestions.com. thanks, everyone.

Erica Muller [00:42:09]:
Thank you.