From Airbnb Co-Hosting to Owning Properties with Bailey Kramer

Quick Summary

Bailey Kramer, a young entrepreneur who transitioned from Airbnb co-hosting to owning properties shares insights on how he started with co-hosting to generate income and gain experience, eventually leveraging this foundation to build his real estate portfolio. The conversation covers strategies for finding co-hosting clients, managing properties remotely, and scaling a property management business while transitioning into ownership.

Key Points

• Co-hosting is a low-cost entry point into the real estate industry, requiring no capital investment in properties.
• Key strategies include networking through social media, real estate meetups, and leveraging referrals.
• Cold-calling long-term landlords to propose short-term rental conversions can also be effective.
• Implement systems and processes to streamline property management remotely.
• Start by building relationships and gaining trust within the industry.
• Be persistent in outreach efforts and focus on adding value to property owners.
• Scale cautiously to avoid over-reliance on a single client.

Full Transcript

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Jeremy: Howdy, welcome to the short-term rental Pro podcast, where we have conversations with those who are killing it in the game, who are making a living with short-term rentals.

I'm here with Bailey Kramer, probably the youngest person I've had on the show to this point, who was able to achieve financial freedom through co-hosting. Co-hosting, for those of you who don't know, is when you manage a property for someone else and just take a percent of revenue.

Bailey, how young were you when you started doing co-hosting?

Bailey: Yeah, Jeremy, thanks for having me on. When I started co-hosting, I was 20 or maybe 21. 20 or 21?

Jeremy: And how many properties do you co-host today?

Bailey: So, I scaled my co-hosting business to 30 units. That was like my big, straight push for co-hosting. Right now, I've scaled back, and we can talk about reasons and shifting and stuff. I'm at about 12 units right now co-hosting, and then I own two Airbnbs. Just me,
Jeremy: And Bailey, before we were talking, because we were catching up. Bailey and I are old pals. We probably talked—what was the first time we talked? Probably like three years ago at this point. I saw just what he was doing, and he saw what I was doing, so we just connected and networked.

But you have actually switched your focus today. You've used the co-hosting, you know, the cash flow and the income from co-hosting, but B, the experience, the data, and you are leveraging that to now build your own ownership portfolio.

Bailey: Yep, exactly. And even like when I first started out, like you mentioned for the first part about building an income stream from co-hosting—for me, that's how I ended up dropping out of college. Like that, that was like—yeah.

Jeremy: Bailey's a college dropout!

Bailey: Wooh! College dropout. Truthfully, that's the reason why I was able to drop out, is because of the co-hosting side. Like you said, I'm switching focuses now. I'm still co-hosting, I'm still bringing on new units, but really the main focus now is, okay, now that I have steady income coming from the co-hosting side, great. I have all this data, all this experience, I have a team that helps me run the properties. Now, switching a little more to, all right, let's start building some wealth now.

Jeremy: Got it. And Bailey, what type of properties? So, I think Bailey's also someone who—he's obviously taking a multi-strategy approach, as have I. He's leveraged other people's properties to now buy his own properties. But what type of—you’re not even looking purely short-term rentals for your ownership portfolio. Tell us, what type of properties are you looking for and why?

Bailey: Yeah, for sure. So right now, I'm strictly focused on midterm rentals in the Midwest. These are properties that, if you say the price of them, people will laugh if they're from California, New York, or anywhere else where properties are more expensive. But places where the rents for a midterm rental are extremely high. Like, for example, I bought a property back in October for $115,000, and it's actually a really nice three-bedroom, one-bathroom house. It's 1970, I want to say, so not crazy old. It's a really nice little house in a pretty solid area.

That one, we just got signed from an insurance company for $2,800 per month. So, $2,800 per month on a $115,000 property. And again, the tenants are in there for three-plus months, so there's really little to no communication. Those are the types of properties that I'm going for right now until I hit probably $10,000 to $20,000 per month of pure profit cash flow. Then I'll switch over to be like Jeremy and buy these big houses with pools and cool stuff.

Jeremy: It's funny how you say big houses because, like, I look at the houses I buy, and like, I'm—my buy box is really like a 500 grand house. That's pretty much it. If you average out, the lowest we've bought was 400, and the highest is 750, but predominantly around 500. Whereas, Bailey, right now your buy box is 150, 150?

Bailey: Not even. 115 is really what I'm going for, or even under, just so that I can match those up with the rents of 2800 per month. Because, at this point, a property for 150,000 that I could buy is just—it's going to bring in the same amount as a 115,000 property where I'm at. So, it's like, I'm only going to go for those lower ones.

Jeremy: Right, sure. And then, what is—so, what is a mortgage on 100—let's say, I don't know—what interest rates are you getting for 115 grand properties, and what does that monthly mortgage look like?

Bailey: Yeah, so when I bought back in October, it was like the—I think the rates were—could be wrong on this, so someone can fact-check me, but I'm pretty sure they were at the peak. Also, I want to mention this—I didn’t have W-2 income for two years. I was, like, the least qualified person, on paper, for the banks to see. I was, like, the least qualified person to buy a house. Yes, I had some experience co-hosting, but, like, from the bank's eyes, I was nobody. I don't even think, at the time, my first tax return was just finishing up. So, I don't even think I had any tax return. I was, like, the worst of the worst on paper.

But I bought it—115,000. I had to put, I think, 30% down, and my interest rate was 8.6%, I want to say. It was high—eight, eight and a half, or something like that. But the monthly payment’s only 750 bucks, somewhere around there. So yes, the interest rate—stupid high. Yes, I had to put down way too much money. But I'm cash flowing. I'm cash flowing 1,500 dollars per month from this property.

So, it's like a crazy cash-on-cash return. But, most importantly, like, that deal is not going to make me a million bucks. But it got me in the door, for me, got money flowing. And now, it's just a matter of duplicating it over and over again, and then now using different strategies. Now that I have the tax returns, and I look better financially to the banks.

Jeremy: Yeah, and you put 30k down, so you have 30 grand of equity in the property. So, are you trying to stack? Is it all in one geographic area, or is it just generally in the Midwest, like certain states? Or are you really trying to—what I call is, like, the fortressing strategy, where you just get a bunch in the same area? How are you looking to expand this medium-term 100k property strategy that you're doing a really good job of?

Bailey: Yeah, so there’s really—right now, I’m just focusing in Indiana. And I don’t live in Indiana. I’ve only been to Indiana one time. And the one time I’ve been there, I was driving through and got a 500-dollar speeding ticket. So, that’s the only time

Jeremy: You had to get out. You’ve been there too long.

Bailey: Yeah, I know. So, the way that I actually found the market that I just bought my most recent property in, which is like the second one that I own just myself, is I co-hosted for somebody who has three properties in that market. And literally, before, we have the data.

Jeremy: You had the data?

Bailey: I had the data—literally before. We’ve done this podcast, I’m texting with someone who found me a Furnish Finder to negotiate a five-month lease for—I’m throwing out 2800, she’s at 2500. So, we’ll see where that one ends up. But I just saw the proof. I’m like, we’re literally always booked. So, I’m like, it’s time for me to get one here.

So, to answer your question, though, I’m really focusing in Indiana. And then, there’s really five-ish markets that meet my buying criteria in Indiana. And my buying—my buying criteria is really just—number one, I’ll tell them, I’ll tell you how I found this market. The first one that I bought in that I’m not co-hosting in, I basically went to cities in Indiana by population. So, I sorted by population. I prefer to buy in, like, larger cities, or the biggest city possible, just because if I buy, like, a 5,000-person town, like, that’s just sketchy, if you ask me.

But, depending on the property and the strategy and stuff, I was like, all right, I want the biggest property possible. But I want property values to be like—oh, I want to be able to buy solid properties for 100 and 115,000 dollars. I also want these markets to not be, like, declining. I want them to at least be staying the same or, ideally, of course, going up…

Jeremy: In terms of population.

Bailey: In terms of population, exactly. So, those are the main things I looked at. I literally went down the list. The first city was Indianapolis—it was like the biggest city in Indiana—and I was like, nope, none of these properties are working. You actually probably could find properties in Indianapolis; it's just so big. So, I was like, this is too much for me. I kept on going down the list and found basically four or five cities in a row on this list: Terre Haute, Indiana; Kokomo, Indiana; Anderson; Muncie. Those are really the main four that I'm looking at right now, and they all just check the box.

They have reasonable property prices, like they don’t have a lot of Airbnbs—maybe after I say this now, everyone's gonna flood the market—and just like the demand is there. So, that's how I narrowed that down.

Jaeremy: They might not be there for a 500k house or like a vacation experience, but for the midterm, two to three months at a time, people who are like, "I don’t want to live here, but I’ve got a project." That’s construction. I’m sure you're getting the nurses. Is it construction workers?

Bailey: Yeah, I’ve seen the past two people we’ve had that have been, like, in my mind, home run deals. We had a construction worker—or two construction workers—there for three to four months, paying 2,650 bucks a month. That was awesome. And then, most recently, we have an insurance company who put in people for three months with the option to extend if their house isn’t ready, which it probably won’t be. But they’re at 2,800 a month. So that was awesome.

We’ve had traveling nurses, and the one that I just told you about who’s texting me now—she’s a traveling nurse. I love the idea of traveling nurses; it’s awesome. The only problem is, if you have a three-bedroom house and it’s just a travel nurse, maybe their partner, they’re usually not looking to spend the amount of money I’m looking for. So, we’ve honestly just done really well with traveling construction workers.

Yeah, that’s probably been our biggest one out of them all. Or people relocating who said, "Hey, I’m buying a house; I just need a place for a month or two."

Jeremy: Yeah, and that’s honestly what I do—a hybrid strategy. So, I put it up for medium and short-term rentals. A lot of times in the winter, when there’s calendars available for a month or two at a time, we just naturally get the medium-term.

It’s like—I feel like someone should draw a diagram and show, like, medium-term demand versus short-term demand. Where short-term, you follow a bell curve—summer—and I’m sure even the markets you’re in, if you switch to short-term for June, July, August, you can make more money. Maybe I’m wrong; I don’t know. I don’t know why people go to Indiana.

I would assume so—that there’s just more travel. But then, in the off-season, it’s pretty much the same medium-term demand, like no matter what time of the year it is. You’re just as likely to get a January renter as you are an August renter. Am I correct with that assumption?

Bailey: Yeah, I would say. Because the property that we have—that I told you we had the construction workers and the insurance company in—before we had them, so like probably for the past three to six months, we were doing it where we would rent it for a couple of days at a time, a week at a time, and we made a little bit less. I think we made 2,400 dollars a month, roughly, and it was way more work.

So, yeah, working at Thanksgiving, filling at Christmas, working on New Year’s. But you can do that anywhere. These properties are both near colleges, so it’s easy to get graduation filled. But besides that, you might get a weekend here and there, but it doesn’t add up to the same amount of money as just a really solid paying monthly rental.

So, I’d say, compared to the work in these markets, midterm rentals are a no-brainer. If you do a short-term rental, I don’t know. We’ve tried it, and it just doesn’t work as well.

Jeremy: Got it. And I want to take this back. So, I think Bailey, as you can see, is very much prioritizing the amount of work he needs to do on a property. That’s a variable. Also, I want to take this back to how you started your co-hosting and how you built that. Because now, you're focused on buying, so it’s like, all right, it’s the same amount of work to co-host a property as it is—so I’m assuming that’s where you’re at, where it’s the same amount of work to own a property as it is to manage it.

I’d rather own them if I can. But to go back to the beginning, tell us, why did you start co-hosting? It seems like it was, for you, a way to get you out of having to get a job after college. It was a way for you to drop out of college, which you did do. So, yeah. Why did you want to build this co-hosting portfolio, and how did you build it?

Bailey: Yeah, for sure. So, back to sophomore year of high school—it was freshman semester—and I read the book Rich Dad Poor Dad. So, that was my introduction to real estate. Before that, even going into freshman year, I had no idea what I wanted to do. All I knew was I didn’t want to get a nine-to-five job. Like, that was just my thing. Anytime someone asked me, like, "Oh, what do you want to do after college?" I’m like, "I want to start my own business."

They’re like, "Yeah, that’s cool. What do you want to do after college?"

I’m like, "Start my own freaking business." But I had no idea what I actually wanted to do, and I never was exposed to real estate as a kid.

Jeremy: Nobody at the University of Central Florida seemed to be that supportive of you, and you're…

Bailey: UCF—that’s the place. But yeah, I never had real estate experience. Like, my family didn’t do anything growing up. Sophomore year, just searching the Google machine, I found Rich Dad Poor Dad for, like, best personal finance books and started reading that. I was like, "Oh my God, this real estate thing is, like, the most genius idea ever. Oh my God!"

That led me to BiggerPockets. That led me to just, like, networking my butt off with as many people as I possibly could, and joining different groups—Facebook groups, paid groups to be in—where I could surround myself with people who were just doing it.

And then, ultimately, the short story is, after a year—after a year of reading Rich Dad Poor Dad—I bought my very first house, which is a fix and flip. And the way that I did that was I partnered with somebody and a couple of people in this mastermind group that I ended up joining. So, I was like, "Sweet, fix and flip, that sounds awesome."

So, we did the fix and flip. It was not my thing, but it was cool. We made some money from it. Then we found another property to fix and flip, or it was like a wholesale. So, I’m like, "Great, let’s do that." That was awesome. Then I bought two long-term rentals with, again, these partners I’m talking about. I was like, "Cool, what’s next?"

It was just—I didn’t really have a vision of where I was going. I was just like, "Hands on some real estate and make some money, like, this is sweet."

Jeremy: What I remember from Bailey when I was talking to him initially—and for those listening who might be younger, you might be in school, you might not have money, but you might have time—Bailey, at that time, had time. He would reach out to folk and pretty much be like, "Hey, I’d love to help you out or provide value for you." And by doing so, they, in turn, put him in front of the right people.

Bailey: For sure, that was the biggest thing. I didn’t—all these deals I’m talking about, like, I didn’t use my money. I didn’t have good credit. I didn’t have really anything but these other people who did have those things. I also didn’t have experience, so it was really just like me getting in front of the right people. That took a lot of time to do, but I would not be where I am today if it wasn’t for the people that have helped me get here, for sure.

I was just doing a lot of things but not really following a clear path. Then my junior year ended, and I had—I had two long-term rentals that were making like a couple hundred bucks a month. Like, it wasn’t a lot because I was splitting it with two or three other people. It wasn’t a ton of money.

Then I had two Airbnbs that launched around, like, July of 2021. These were humongous lake houses—this was like a really cool experience. I was like the self-proclaimed manager on the properties because everyone else was in their 40s and didn’t understand technology or how to run the business. Honestly, I didn’t either, but again, I had time on my hands. So, I was like, "I’ll do it."

I was getting a management fee from it too, so that was cool. Then basically what happened is I was just like, "All right, I’m on the hunt for the next deal. Let’s just keep on doing this over and over again." Then someone actually came to me—they were on Instagram—and said, "Hey, I have someone who just bought a property and they need a co-host. Do you want to do it?"

I was like, "Sure." Like, I didn’t even know co-hosting was a thing at this point, but I was like, "Sure, I can do that." So, I ended up co-hosting this property, and that very first month I made like 900-something bucks. I was like, "900? I didn’t put in any of my own money. The turnaround time was super fast. I didn’t have to deal with all these different partners." It was just like this one owner.

I was like, "Wow, if I can just get five more of these, I could see this happening a lot faster than me buying five more properties and having to deal with a bunch of other variables." That was kind of like the spark for me where I was like, "Geez, if I can just get a couple more of these things..." That’s not my end goal by any means, but I’ll be out of having to get that nine-to-five job. If I can make 5,000 bucks a month minimum, that’d be cool.

Jeremy: I think that’s similar to how I was back probably around when we first talked. Yeah, but I still do co-hosting to this day. I co-host five properties, and initially, it was really like—yeah.

This is a place where just making five thousand dollars a month on average—that’s a thousand dollars per property—you don’t put any cash in the game. And for me, it was definitely, and it seems like for you, the starting point: getting experience, getting properties. It also does help to have scale so you can hire more team members, have more local presence—they’re going to want to come to your property and take care of things quickly when you have more volume in an area. So, there are benefits of scale.

But then ultimately, cash—co-hosting doesn’t require you putting in any cash. And you take out. There are, in my opinion—and maybe I’ll get your opinion on this—ultimately, it is someone else’s property. And sometimes, maybe, there are too many chefs in the kitchen. I don’t know if that’s something you’ve experienced, but that’s business as a whole. That’s just like having clients—technically, they’re your clients.

But yeah, what I want to ask is, how are you able to—like, someone listening who wants to follow in your footsteps, start a co-hosting business. Obviously, you were posting on social media, and that seems like how you got your first one, was you just put yourself out there. But let’s say someone hasn’t started doing that. What are tangible ways to get co-host clients?

Bailey: Yeah, for sure. So, I break it down into three things you have to check off in order to successfully land a co-hosting client:

Someone needs to know you, someone needs to like you, and someone needs to trust you. The "like" and "trust" thing—that’s something that I can’t necessarily teach, like how to get someone to like you. You just gotta be likable.

Jeremy: You’ve got to be nice, gotta smile

Bailey: You gotta be nice, smile, be friendly—just be a nice person. That’s some trust factor. The "know" factor is like the biggest thing that people have trouble with. How do I get people to know me and know what I do? And how do I know people? How do I get to know people who actually need my service?

Jeremy: So, is that—would that be outreach strategy? Obviously, I think you did inbound on social media.

Bailey: Yeah, so like literally, there are—and I’ll name some things—there’s like a million ways that you can possibly get people to know you and vice versa.

What I see—start with the mistakes that I see people make first—is, when they first start out co-hosting (or any business, but co-hosting specifically), they’re like too embarrassed or too afraid to tell everyone what they’re doing. So, the biggest mistake I see people make is, "Oh, I’ll just get like a subscription on Co-Host Marketplace, and I’ll just, like, magically, or I’ll just make a listing on Upwork, and I’ll just magically get clients."

I’m not saying you can’t get any from those platforms, but if you’re looking to actually start and you want to do it successfully, you have to be, like, putting yourself out there and putting in effort.

So, for example, one strategy that has been successful is calling long-term rental landlords and asking them, "Hey, saw your property listed for rent—have you thought about turning this into a short-term rental?" If you call one long-term rental landlord, I almost guarantee you they’re gonna either hang up on you or tell you no. If you call 10, they’re probably gonna hang up on you or tell you no. It’s a volume game.

Jeremy: I would say that’s the same. That is the same because a lot of folk—Arbitrage is very popular, and that is the same approach. It’s just calling. You see an apartment for sale or you see an apartment for rent. You see a home for rent, their phone number is listed, you give them a call.

Chances are—the first one I ever called, I’ve actually never done outreach for co-hosting. For whatever reason, I’ve done outreach for Arbitrage, but for me, co-hosting is mostly—I'm mostly doing it on a lake where I already have properties and I have a boat rental business. Yeah, so it’s just like word of mouth, how it gets to me.

For better or worse, I probably should be a little bit more—I actually reached out to one property just because I saw it. I was like, "This is such a dope house. I just gotta talk to them and see what’s up." I digress, though.

But either way—Arbitrage, co-hosting—you gotta be comfortable just base-level putting a phone to your ear and having conversations with people. The first call I ever did, I remember calling a guy in Wilmington, North Carolina. I saw his house and I brought it up, and I was so timid. And he just said, "I’m not interested in that." I said, "Okay," and I hung up. I was like, "All right, that wasn’t that bad." Yeah, no, whatever.

Bailey: For sure. And for people that are, like, super scared—test it out in some random market. Just start calling people. Just start getting rejected.

Jeremy: Get comfortable.

Bailey: And then, the first one is always the hardest one to get. There’s no way around it—it’s the hardest one to get. But then, after you get that first one, referrals start to kick in way more. Because usually, if someone owns an Airbnb, they typically know someone else who owns an Airbnb. Or they themselves are looking to buy another Airbnb. So, the opportunities are endless once you get that first one going.

But it takes time. That’s what people always miss out on. They think, "Oh, I’m just gonna get a property in a day." And if they don’t get people to answer them, then they give up. You gotta stay with it.

Also, like, Meetup groups—that’s somewhere that I gain co-hosting clients from. Going to real estate events, like real estate Meetup groups—I prefer in-person nowadays; it’s just easier to connect with someone if you’re in person at a Meetup. But those are awesome ways to just build relationships, get people to know you. It’s all about relationships, honestly.

Jeremy: Yeah, actually, that’s funny because Bailey and I—so Bailey, I’m from North Carolina. I spent a lot of time in New York City. My girlfriend lives here, but I’m from Chapel Hill, North Carolina. Bailey lives in Durham, which is right next to Chapel Hill, and he’s networked.

The local real estate investor group—or one of them—is actually by my friend. He started that. Yeah, so I actually went to two of the Meetups there. And the second one, I actually talked to someone who ended up calling me and offering me to co-host his property. Which is funny because I didn’t even come there with that intention—I just came to see friends. But that’s just what happened.

And I wouldn’t even talk about his property at the Meetup. He just, afterwards, hit me up. He said, "Hey, by the way, I know you do this—would you be interested?" And then, I actually didn’t do it. It was just a property where, to me, the juice was not worth the squeeze type of property. Like, it’s really far out there in a pretty rural area.

But someone else who goes to the Meetups—Avery. Yeah, Avery texted me yesterday that he’s doing the co-hosting for that property. So, I just think it’s funny. Yeah, and they probably talked to him at the same Meetup, too. So, the Meetups are real, guys.

Like, wherever you live, there’s probably a Meetup. In New York City, we do short-term rental Meetups about once a month. Not as much, but there are real estate Meetups. I would just go to a real estate Meetup, and you find one landlord.

This is something I say for Arbitrage, but it’s the same for co-hosting, too. You can find, like, one landlord—one investor. They don’t need a thousand-unit portfolio. Let’s say they have 20 properties, and they either rent four to you or five to you, or they let you manage four or five on a co-hosting basis. Bang, you could be set. Like, you could quit your job right there.

That’s—even if it’s 800 a month times four or five times five—that’s four grand, you know? So, you really just need one person. And it doesn’t, again, it could be like a medium. Like, guys, there’s a lot of landlords out there with 10–20 properties. There’s a lot of them. You would be surprised with how many of them there are.

And I’m assuming that’s how you found scale, is through a couple? When you said you got to 30, I’m assuming it wasn’t 30 different—if it was 30 different owners, that would be very strenuous. But yeah, was there one or two really big, bigger fish that were your clients?

Bailey: 100%. Yeah, one big fish in particular and then a couple of owners who had a couple of properties. But yeah, one big fish who—I was able to...

The operations side is—for an owner, that’s the only thing that people understand. Like, the operations side is a lot. Like, to co-host someone’s property, of course, you want to automate it. But for someone like an investor who’s strictly focused on buying properties, for them to learn the operations side is so much work.

So, for this one owner in particular, I was able to take all the operations completely off his hands. That way, he was able to strictly just buy properties. And that’s really how, like, one of the ways I was able to grow so fast—by basically partnering with someone like that. An investor who was just like, he’s looking to buy, I’m looking to operate. And by me doing that, he was able to scale a lot faster, and I was able to scale a lot faster.

Jeremy: So, how many properties did you grow to with this one owner?

Bailey: I want to say, like, properties—like eight, eight or nine. But one of the units was a mini motel.

Jeremy: It was like a hotel? Yeah, I remember.

Bailey: Like seven or eight units. So, if you include—if you just go unit-based—it was like 15 units. But it was like seven, it was like eight or nine properties, I want to say.

Jeremy: Wow, okay. So, at a time, about half your portfolio was with one owner, which some could say, "All right, then you’re a little bit too concentrated with one guy." I’m assuming maybe that’s why you went from 30 to 15—was probably that one owner?

Bailey: Yeah, for sure.

Jeremy: We don’t need to get you into the whole tea, but I mean, is there, like, a high level of—sometimes things don’t work out with co-host clients?

Bailey: Yeah, high level, I would say, number one, too many eggs in one basket. That’s for sure a thing you want to avoid. And that’s even what I tell people now. Okay, like, great, it’s awesome that you’re working with this one person, but you’ve got to branch out on your own.

That’s also part of the reason why I’m strictly buying by myself right now. For the first 10–15,000, I want that just to be for me. I don’t want to talk to anybody about it. Like, I want to wake up and not have to say a word and just make that money for me.

And then, yeah, so with those 15 properties, high level—I would say, high level, there was a... let’s say, a falling out, I guess, is the easiest way to say it.

Jeremy: Hey, this pod is about the tea, you guys. You’re here for the tea.

Bailey: For this, it’s like—the story itself is so many hours’ worth, so I’m just trying to condense it into a sentence. I would say, the trust wasn’t there between us. And really, me not trusting him, not agreeing with some decisions he was making—I would say that’s, like, the most PG way to say it. I wasn’t agreeing with some decisions he was making that could have jeopardized me and my control of actually operating these units.

So, instead of me waiting for him to fall off the rails and then me go down with him, I guess you can say, I said, "Listen, I gotta get off this train. I don't like where it's going. "See you later," kind of.

Jeremy: I'm sure, but I'm sure you know that you were on the train for a few years. Oh, and that train provided you flexibility and avenues onto the train that you're on today. Oh my God, you had two trains go next to each other—you hopped onto the next train.

Bailey: For sure, yeah. That train opened my eyes to, like, a bajillion different things—tons of good things, tons of bad things. But at the end of the day, everything that I’m doing now, or a lot of it, is like learning experiences from what I’ve done in the past. So, I don’t regret anything, and there’s nothing bad from it. It’s all just good learning going forward.

Jeremy: Got it. Okay, so you co-host how many, and you own how many at this point?

Bailey: 12 co-hosted, two owned.

Jeremy: And then for the 12 you co-host, do you charge the same management or co-host fee across the board?

Bailey: I guess technically no. I usually shoot for 20%. That’s like the base. Then there’s one owner in particular that has three now, and they’re going to continue to—actually, they turned their long-term rentals into short-term rentals. Now it’s one of those, so I’m doing 15% for them. Those are like midterm rentals. Then there’s another midterm I’m doing at 18%, and then the rest of the short-term rentals are all at 20%.

Jeremy: Got it. Okay. And then how many do you own yourself now?

Bailey: Two.

Jeremy: So, you're at 15 listings?

Bailey: Yep, roughly.

Jeremy: Is there a transaction volume across the 15?

Bailey: That’s a good question. Honestly, I don’t know, and I think seasonality is definitely a huge thing. Like, I have a property right now that’s already booked out for June and July. It’s doing $20,000 to $25,000 per month for those two months in the summer.

Jeremy: The lake houses?

Bailey: Yeah, the lake houses are phenomenal. But in the wintertime, they’re doing like $5,000. If I had to throw off a number...

Jeremy: Do they have a hot tub?

Bailey: No, but we have a pool.

Jeremy: In the winter, that doesn’t do too much.

Bailey: No, it doesn’t.

Jeremy: Yeah, we just got in so much—and this is probably my fault—of posting, when people are just stalking my portfolio. But the inventory of lake houses... and also, I think it’s just natural too. Things like this, I’m sure on the lake that you have, you manage property, there’s more Airbnbs now than there were a couple of years ago.

We’re definitely trying—adding hot tubs and stuff. And to be frank, if anyone’s listening and is looking at that, like, numbers don’t work, everyone’s gotta stop trying. Like, literally, I had one investor call me a year or two ago. He was buying this house, and he was like, "I’ve got this deal," and he just wanted my thoughts on it.

I was like, "I mean, I don’t know." But he bought it anyway. Then he calls me back this year—it’s doing, like, $45,000 for a half-million-dollar lake house. I’m like, "Yeah, it’s not..." I’m like, there are things you could do. But he’s like, "Alright, how much could you do if you manage it?" I’m like, "I’m not trying to tell you what I would do to the property," because it was... whatever. It was all a good conversation.

But my point being is, yeah, I guess things we’re saying right now, take with a grain of salt as to specific areas. And I always recommend people—I think there’s a huge—I don’t want to say problem, but there’s just a huge...

A lot of times folks who are trying to get in, whether they’re trying to arbitrage, whether they’re trying to buy, they’re just like, "What type of area? What area?" Literally. I’m sure you get it. You get it where it’s like, "What city is the best city? What area?"

And then, if that’s your way of thinking, in my opinion, you’re destined for failure. Really, it’s—Bailey has a strategy. He’s finding the right type of property for the clients that he’s looking for, in not even a specific market, but several markets that have the same characteristics.

Bailey’s thinking about it. He’s not just saying, "Oh, I’m buying in this town, and if I just buy something in this town, automatically we’re good to go." He’s saying, "I want a medium-term rental for these properties. They’re going to cash flow $1,500 a month. I don’t want to have as much turnover and more to deal with."

Whereas the lake houses... the lake houses cash flow—I mean, if they’re making $25,000 a month, what’s their mortgage on that?

Bailey: They bought it for $650,000, so I don’t even know.

Jeremy: They’re cash flowing a lot more, but you know, that’s obviously a much bigger house. But for that house, it warrants doing a purely short-term strategy. There’s probably not a market for the medium term. But just being thoughtful about what type of property you’re looking for—what’s your buy box, who are the clients coming to your property, and how do you reach them?

Obviously, breaking down the numbers—Bailey knew off the top of his head that he could rent these out for $2,800 a month, and his mortgage payment is like $750 to $800. That’s really back-of-the-napkin math. You guys can go to BNBCalc if you want to do more than back-of-the-napkin math and actually break it down into all the individual characteristics. But really, you could also just do napkin math or something like that. For sure, he’s taking that deeper step.

And I want to break this down. What are some tangible tips that you have for folks listening?

Actually, scratch that question. Someone asked me the other day—for co-hosting, if you’re trying to start—people I work with, they want to add the co-host strategy, and sometimes they’re in places where they want to do a new market.

I recommend doing a Google My Business in whatever market they’re trying to tackle. Is that something you recommend?

Bailey: Yes, I want to throw one thing to the point you said before because it’s super important, and then I’ll answer the Google My Business thing. But yeah, knowing the exact market, the exact person you’re targeting—all that stuff is super important.

And then also, really, the first thing is, what’s your end goal for the property? Because, like I said, there’s a reason why I’m not buying lake houses right now or vacation-style houses. It’s strictly because my personal goal is to get consistent monthly cash flow with properties I can take down strictly by myself.

So don’t think, "Oh, you have to go to the best market right now for vacation rentals near lakes." What is that going to do for you? For me, in a year, that’s going to do a lot because that’s probably going to be more of my focus as far as tax benefits and more scaling with it.

There’s not necessarily a right or wrong, but you have to know why you’re doing it. Or else, what’s the point of you finding a lake house if it strictly just makes you a couple hundred dollars per month in cash flow, but your goal is appreciation after five years? I don’t know.

So it’s just important to know why you’re doing it. And then, going back to your question about people who are looking to get into the co-hosting game, Google My Business is definitely one solid thing. I would say it’s a super easy thing to set up—it takes 15 minutes, not even. So, if you’re looking to start a co-hosting business, I would say, yeah, set up Google My Business.

Like, it definitely does not hurt. I don't think it's going to be a magnet where you're going to get called left and right the second you post it, but it's one of those things where you make it, and it's a longer-term play where you're going to continue to build on it. For sure, you're going to get reviews.

Jeremy: And then also, if you build, do you put a website up that's attached to the Google My Business?

Bailey: Yep, yep, you can do that as well, for sure.

Jeremy: So, you have a website. Do you have an outreach strategy? So you're reaching out to people who are renting their properties long-term?

Bailey: Yep.

Jeremy: I think I remember you saying that. Like, you can look for Trulia furnished rentals as one of the good approaches because someone's much more likely to be willing to convert if they don't have to actually furnish it. They can just post it—that’s a lot easier than having to set up.

When you do set up a property for someone, let’s say you reach out to someone who has a long-term rental and they’re looking to convert it to short-term, do you project manage the conversion? What do you—what would you call that? A setup you would charge them with?

Bailey: Yeah, exactly. You would charge them a setup fee.

And going back to the Trulia thing you said, the most recent co-hosting client I got—it was a referral because I wasn’t necessarily looking in this market—it was Cary, North Carolina, the one I texted you about. But there are plenty of owners just like the one I’m working with now. She had it listed on Zillow, she had it listed on every site you could possibly think of, but for way too cheap. Like, she was doing 500 bucks—like 500 bucks less per month than she should have. She probably could have even gotten more than that. So, you can even call it 1,000 dollars per month less than she should have.

And hers was already furnished, ready to go. So, it was just a matter of saying, "Hey, I noticed that."

Jeremy: Did you reach out to her?

Bailey: I didn’t because this one was a referral to me. I didn’t have to go through this process because I wasn’t looking in this area. But if I were to be looking in Cary, North Carolina, or any other market—

Jeremy: Who referred you?

Bailey: Someone from social media.

Jeremy: Do you pay for referrals?

Bailey: Yes, I paid her a $500 referral fee.

Jeremy: Got it. And that’s also one thing you could do—pay for referrals. Call a realtor, talk to realtors. Talk to— I guess I’ll ask you—who else are good referral partners?

Bailey: Yeah, realtors are awesome. What I always say is, start with your inner network. That could be friends and family. Even if they don’t have Airbnbs or they’re not real estate people themselves, they always know people who are interested in real estate.

So, I would just say, to start, you’ve got to tell your friends and family about it. I’ve seen also, too, like sometimes people are too afraid or embarrassed. "What are my friends or family going to say?" You just have to do it—there’s no other way around it. Like, my parents and friends and family weren’t thrilled that I dropped out of college. I went for it anyway.

You just have to start talking: "Hey, I’m looking to get into this Arbitrage thing, this co-hosting thing, this Airbnb thing." Start the conversation.

And then, yeah, for actual professionals, realtors are great. Airbnb cleaners—that’s another really awesome one, where you can literally find people who clean Airbnbs, get in touch with them, and then say, "Hey, do you have any clients that might need some help?" That’s an awesome way.

And especially when you have properties, it makes that conversation even easier. But again—

Jeremy: Because then they’re cleaning yours, and you can say, "Oh, tell me about the other people you’re cleaning for."

Bailey: Exactly. But even starting out, you can still—like, the strategies don’t necessarily change. It’s just, you’re going to have to do more volume because you don’t have any proof or track record. So, it is what it is—that’s really any business.

Jeremy: Yeah, so it’s really, at the beginning, being pretty relentless. Hey, letting your network know what you’re doing. That could be a Facebook post or wherever your network is: "I’m doing this. I’m becoming—or I’m—a co-host. I’m working."

If you’re part of a mastermind, you can say you’re part of a mastermind. And you just want to let everybody know and see if anybody has any leads. "Hey, I’m paying for referrals. I’m paying 500 per property referral."

Yeah, to be frank, I’ve had people come to me, and you know, if someone—if I knew I could get 500 bucks to make this intro, that would... probably a lot of people would do that.

So really, your tangible tips: referrals are a good one. If someone’s looking for a co-host client, offer to pay for referrals.

Bailey: Yep.

Jeremy: Also, put yourself out there. Let people know what you’re doing. Don’t be afraid to call. If you see a long-term rental on there, don’t be afraid to dial. Build relationships. Something I usually offer as advice is, if you can meet up with somebody, meet up with them. Bailey, it seems like you’ve been more remote for the most part?

Bailey: I’m a remote guy. I think in person, if you’re brand new, can maybe even help you a little bit more. Personally speaking, I wouldn’t meet up with just anybody right this second where I’m at, depending on the property size.

Like, I know you like that mansion on the lake that you co-host with the units that are going up—I’d meet that guy in person. But I wouldn’t meet just anybody in person right now. But if you’re just starting out, you have to do what it takes. That’s what it takes.

Jeremy: That’s what I did early on during COVID, and that’s... I don’t do it anymore. I can’t remember the last time. Maybe I’ll meet up at the property to look at it, but early on, we’d meet up, grab a beer—even if there wasn’t a specific property we were going to talk about. I just knew they owned five.

And I also just knew that... my lights just went out for whatever reason. On YouTube, if you guys are on Spotify, ignore me. But yeah, just meet up. Feel comfortable putting yourself out there.

What other—And then, I guess we talked so much today about putting yourself in front of people, getting clients. And then, obviously, also it’s been awesome to watch you and see your trajectory and how co-hosting is really the start for you. It’ll be interesting to see what you’re doing in 10 years.

For me, again, co-hosting was pretty much the first strategy that I used, and I still use it today. But really, a multi-strategy approach—as your career evolves, as your situation changes—you can morph.

The thing that’s cool about short-term rentals is you can morph it into what you want it to be. So, we’ve talked about a lot on the front end, but then on the back end, you’re managing everything entirely remote.

I know we only have a couple of minutes here, so how do you do that?

Bailey: How do I manage everything remote? That’s a loaded question, but I would say systems and processes are, like, the biggest thing. I would say the easiest things—

Jeremy: How many times do you say systems and processes?

Bailey: A million. But I’ll make it more practical. Like, the things that are, like, super easy to do remote would be, like, pricing strategy.

It’s so easy to look online. Obviously, there’s a lot more analysis that goes into it, but, like, I can price a property anywhere in the world. That’s part of the management process—that’s super simple.

I would say a system or kind of documents that we have in place makes, like, a night-and-day difference.

We have, number one, questions that the owner typically answers when we onboard them. They answer basically every possible question that a guest would ask about their property that we wouldn’t necessarily know, especially since we’re not in person.

Jeremy: “Where’s the water heater?”

Bailey: Exactly.

Jeremy: “Where’s the breaker box?”

Bailey: Yeah, assuming.

Jeremy: Assuming all that jazz

Bailey: All that jazz. All that jazz. And then, when issues happen—this one—this is also part of my pitch when I’m pitching someone to let me co-host their property. They’re like, "Oh, Bailey, I wanted someone in person to do it. Like, I know you’re remote, but I wanted someone who’s gonna be, like, in person."

I tell them, Listen I have properties where the oven's caught on fire, I've had the wells stop working. I've had roof leaks. I've had—you name the issue, I've had it. I said, just to be honest with you, whether I'm your next-door neighbor at the property or a thousand miles away, all I could literally do if I'm at the property is take a video for you. But I can't—I'm not a handyman. I can't fix the oven; I can't fix a roof.

What we do is we find the right person to get the job done as quickly as humanly possible. I know what you're saying. That’s why I say, I know it sounds great if I’m in person, but at the end of the day, I can’t do every possible thing. And you don’t want me to do every possible thing, because if I go on vacation for a week, then the whole team crumbles.

But if I have a team under me, then we have a bunch of different options, no matter where I am.

Jeremy: Exactly. And that’s the truth of the matter. You need people, regardless of if you’re there or not. You can be a jack-of-all-trades—maybe handyman, plumber, or electrician—but how often? And then, at that time, if you’re that locked in, let’s say you’re fixing something, and the guest is messaging you and calling you, and meanwhile, you’re doing electrical work—it’s really not the best distribution of energy.

Really, you should be focused on high-level things: the marketing, making sure it’s getting booked; the pricing, making sure that you’re competitive against everyone else in your market; the things that you can do digitally.

And also, I think a lot of things you do digitally, you can also have others do digitally. I know we only have a minute left, but tell me about your team—who you have doing the day-to-day operations. I think you’ve taken an interesting approach that I haven’t seen many others take. Yeah, the military moms.

Bailey: Yes, yes.

Jeremy: Yeah, go into that. What do you mean by that?

Bailey: I’ve got three team members—they’re all military spouses. So, just an interesting niche, you could say. When we last talked, they were all US-based. Now, we have one person who’s in the Philippines but lived in the US for a while, so she’s not your typical VA—I wouldn’t call her a VA. But we have, yeah, basically three people. Two of them really handle guest messaging, and then one of them is like the manager. The manager basically takes me out of the day-to-day operations.

Jeremy: Do they communicate with the owners?

Bailey: We’ve started to transition that.

Jeremy: That’s the thing with co-hosting—being the one who actually talks to the owner, it’s hard to get that from someone like me, who did the onboarding, to then say, "Oh, actually, your point of contact is going to be someone else."

Bailey: We have started to do that. We’ve started to onboard them with the manager as well, so they already know who she is. That way, the communication is easier to handle.

Jeremy: Got it, got it. Okay, let me know how that goes, because I’m curious on my end. That’s the thing—with Arbitrage, it doesn’t really matter. We’ll have our team put in maintenance requests, and obviously, if there’s something I’ve got to deal with, the landlord will let me know. But with co-hosting, they’re your client.

Like, Arbitrage is more of a partnership—you’re paying them literally monthly, fixed monthly rent—whereas, with co-hosting, they’re your client, which is different. The relationship is different, and it’s a lot more client services—making sure that they’re happy and stuff like that.

But I digress. I know you had a hard stop at the top of the hour here. So, Bailey, if anyone wants to reach out to you and learn from you, how can they find you?

Bailey: The best place is Instagram. You can just look up my name—you’ll see me on Instagram. It’s Bailey Kramer. I think it’s, like, "the_bailey_kramer."

And most importantly, if you guys got value out of the show, go to iTunes and leave a five-star review. Jeremy’s the man, and I appreciate you having me on, Jeremy.

Jeremy: That’s what I needed. Thank you so much. Really, yeah, guys listening—I gotta start saying that. But if you guys found this helpful, or someone else wants to learn about short-term rentals, share this with them. That’s the only way this grows. I’m doing this purely for you guys.

I’m having great folks like Bailey on for y’all. Hit it with that five-star. I’d appreciate that. Send me a text, any feedback, thoughts—I always want to make this better.

So, this week has been great. Bailey, thank you so much for coming, and stay tuned for the next one.

Bailey: Thanks, Jeremy. Peace.