Investing Beyond Data with MyBrokerMatt

Quick Summary

Matt, a seasoned real estate investor, mortgage broker, and property manager, shares his journey and strategies for successful real estate investment. The discussion highlights his unique approach to investing in areas with limited data, leveraging partnerships, and scaling a diverse portfolio of properties. He also emphasizes the value of direct experience and the importance of balancing risk with strategy.

Key Points

• Trusting intuition and market potential in areas with little to no available short-term rental (STR) data can yield high rewards.
• Prioritize understanding the local community and potential for unique experiences over relying solely on analytics.
• Outfitting properties with distinctive amenities, bold designs, and strong themes can help them stand out, even in saturated or overlooked markets.
• Collaboration with partners enables faster scaling and sharing of expertise.
• Partnerships also mitigate risks, as resources and decision-making are shared among multiple stakeholders.
• While rental arbitrage is a viable entry point, property ownership offers long-term benefits, including appreciation, tax advantages, and greater control.
• Transitioning from long-term rentals to short-term rentals unlocks additional income and tax-saving opportunities.

Full Transcript

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Jeremy: What's up, guys? We are live with the Short-Term Rental Pro Podcast. I'm here today.

Matt is a real estate agent, mortgage broker, short-term rental investor, and owner of an Airbnb co-host property management company. So really, Matt wears about all the short-term rental hats you could possibly wear and has been extremely successful in building the impressive portfolio that he has.

Matt, thank you so much for joining today.

Matt: Thanks for having me, Jeremy! Man, I think the last time we spoke, you were on a mountain bike ride, or a hike, or a run, or something—which is, I think, what you do almost every day anyway. We were like, I was like, "Hey, are you waiting?" And you were like, "Yeah, I mean, I'm just at my 10th mile of my run." I'm like, "How are you talking to me?"

Jeremy: But it's a skill! Unfortunately, I think after that, I got a stress fracture not too long after. So maybe you need to turn it down a bit.

Matt: Yeah, yeah. Well, hey, either way, awesome job staying fit while you build your businesses. It's not easy—not everybody can do it, so kudos on that.

Jeremy: I appreciate it. So, Matt, he's based in Michigan. Where do you live? In the Detroit area?

Matt: Yep, there's a city called Royal Oak. I'm from Royal Oak. We've got rentals here, Airbnbs here as well. Metro Detroit in general has been good. It's been good—it’s where I kicked off my STR and long-term portfolio. This year, I closed on my 51st home. So I’ve got 51 now: 31 are Airbnbs owned, and then we co-host almost another 30 on top of that. So it’s been a lot.

Jeremy: While you're closing deals for clients, you're also underwriting or a loan—not a loan provider, but I guess, no, it’s... haven’t seen a more broker version.

Matt: Yeah, that's why it’s confusing. Yeah, there's loan origination, there's mortgage brokering, right? So our mortgage brokers—what we do is we get in touch with all the lenders and options for people that are looking for various types of loans: DSCR, bank statement loans, second home loans, primary loans, you name it.

Our whole goal is, with my partner—we actually, we started—we actually met as underwriters back in the Quicken Loans days when we worked there together. What's cool is myself and Byron, we've both been doing flips, we’ve been doing BRRRRs, we’re doing Airbnbs. So when people call in and they want to know, "Hey, what's a great product for this?"—like, hell, we’ve used them all.

And so, it’s like, there’s nothing like talking to somebody that not only sells it but uses it, right? Like, we actually are still out there buying, doing our thing. And that’s the biggest thing—that’s probably where the most natural conversations come with our clients, and our friends, and our students.

The biggest thing we want to do is be the people that are actually doing it, talking it, living it, rather than the guy like, "Yeah, I used to flip. Yeah, I used to do STRs. You should buy this." "What would you buy?" "I wouldn’t buy it—I don’t buy anything anymore."

Like you and I, Jeremy, we’re living what we do, right? We don’t just tell people, "Hey, it’s a good idea." We’re out there buying. You just bought another one. You bought another cool property with probably the best financing I’ve heard in months. So, well done!

Jeremy: Thank you, thank you! So yeah, creative finance is definitely the wave right now. But Matt, so you do a lot. You’re obviously... but you’re—and what I want to get into, and I think is unique to you, is that you have Michigan kind of on lock. Not only the Detroit area, but a lot of these more rural places where there’s no data.

A lot of people getting into short-term rentals, when they look at a house, they want to make sure—a lot of investors want to make sure—that there are reliable comparable properties in the area. And you have a really good understanding of the potential for the property.

Matt has been traveling in the unknown space for his entire career. He’s been buying—not that there was even a lack of data—he was buying where there was no data.

So, Matt, can you kind of give your background on your evolution as a short-term rental investor? And also, I want to parlay that into how you've—kind of your investment thesis of buying where there isn’t data, and what you can do to be proactive and make sure that you know you’re going to get the desired outcome, even though you don’t really know going into the swing of things.

Jeremy: This is such a Kenny Bedwell conversation I’ve had. Yeah, the STRInsights guy. So, for how I kind of just take you on my journey. My first STR I was buying—it was actually a long-term property I already owned, and the tenant was coming up. I said, "You know what? This Airbnb thing is kind of getting interesting. I wonder if this could work down there."

I started thinking about it: What's my risk? What's my risk? Furnishing, a couple months of not booking, then I guess I'd have to sell it. A couple more weeks of downtime between setting it up and removing it if I had to. But I was like, to be frank, I just wanted something new. I was feeling kind of stagnant in my long-term investing career. I wanted to try something that got me excited again.

So I said, "You know what? Screw it. Worst case, I'm out maybe 10 grand in furnishing." This is back then—this is five years ago. It was my first STR.

Jeremy: which is like 100 years ago in short-term rental years.

Matt: I got my STR cane in the back right now. I'm like hobbling around.

Jeremy: Like an old man?

Matt: Like an old man. Yeah, no, you're accurate though.

So I got it up and running, and I was like, "You know what? Hey, this is actually making probably 70, and sometimes 100% more net income than what my long term was doing." I was like, this is pretty cool.

Another reason why I tried this was, it's a nicer, older town—kind of a sleepy-eyed town—but it's dense enough. It's close to the Detroit River. It's called Wyandotte, and it's cute. There's just some cuteness to it. There's nothing really drawing people to it, but there's just some part of me that said, "My gut feels good about this. I don't think I'm going to lose here."

I went for it. It went well.

The next town I went to was more of an inner-city area that some people would consider kind of rough at the time. It's now…

Jeremy: Detroit—kind of Detroit.

Matt: It’s very Dertoit. It's just outside of Detroit; it's adjacent to it. It's now flourished. It's great. There's a lot of improvements in that city. But we went for it, and I said, "No, I'm just going to try it again. I'm going to try it again. Let's just bet on it now."

Hazel Park is where we did it. Hazel Park was a little shoddy at first, but man, it started making money. I bought that property for maybe 60,000—and this, of course, is like four and a half years ago now—but I was making like 4,500 a month on it. So what's my mortgage on 60-something thousand?

Jeremy: It was like, what? $400?

Matt: Yeah. I wasn't mad about it, let's just put it like that. I was like, "Yeah, I'm like two for two." Then I got my third one—that worked. My fourth one—I was like, "You know what? Screw it." Fifth, sixth, seventh—and before I knew it, I just kept going.

I started realizing what I was seeing, what I was presuming—it was all coming true. My understanding of the market, what people needed—it was just working out. So I had to keep going, and before you knew it, about a year and a half ago, I started going to the STR conferences because I just heard about them.

I'm seeing these people on stage. They're all saying, "This is how I got to five and ten properties." I'm like, "That's cool." Then I get in these small groups, and they're like, "Well, how many do you have?"

I think I was at 20-something at the time, and they kind of dropped their jaw. They're like, "How are you at 20-something? You mean arbitrage, right?" I go, "No, I own these."

And they just couldn't believe it. Like, "Why aren't you teaching? Why aren't you spreading the word?"

I was like, "I guess I could." That's why I started looking at doing consulting work. I started sending deals to people to actually sell STRs. I found out I was one of the first people doing that too.

So, to your point, yeah, I've just been doing it. I was kind of like a groundhog, just busy tunneling, doing my thing. Then I looked up one day. And, uh, apparently I had a hell of a tunnel. So now, I'm kind of trying to share that in my experience—my Matt Method, if you will.

Matt: And my Matt Method is... it's kind of simple, honestly. It's changed now with the introduction of AirDNA and STR Insights, because now there's actual data to come and review. But generally, it starts with:

A. Do I like the spot? Do I like the city? Do I like the population size, the density? Is that somewhere I would want to visit?

Because, obviously, the lakefronts become more rural, more seasonal. And as I kind of thought about it, I said, "Okay, I bought one in Traverse City." Traverse City is up here. Traverse City was, I think, my first big jump. It was almost four hours away from my hometown, and I bought it right around my wedding.

And I said, "You know what? This could be a really beautiful house. If nothing else, we'll use it as a second home. But I think it's going to make money. But if it—worst case—it breaks even, let's try it out, right?"

So, I buy it two, three weeks before our wedding. My wife was gonna kill me. We furnished a house in two, three weeks, and we ended up having our wedding brunch there on the Saturday of the wedding. And it was great.

But we started renting it the following month, and we started realizing, "Man, this thing is actually holding its own in its first two months." And by the first summer, we had some 5K net months. I was like, "This is epic. This is fantastic. We did really well on this one."

And I started realizing, "Okay, I did a mysterious, most expensive buy, the furthest out, in a new area. I had to rebuild all of my systems—my handyman, my cleaners."

And what did I do? I did what anybody that's trying to make something work does, right? Remember when you went back to your first days? You're like, "I gotta make this work. I gotta double-check my numbers. I gotta reach out."

Matt: I started—I jumped in every Facebook group. I called every handyman. I tried everybody until I found somebody—every cleaner until I found the right person, every hot tub cleaner until I found the right person.

And honestly, after about two months of troubleshooting, the home was operating pretty well. And now it's making money, and we still love it. Occasionally, we get to visit it when it's not being rented.

And from there, we've bought more lakefront properties.

And the key factor is: do you see that people want to buy there? Do people want to enjoy that time? When you go up there to even review the property, do you see a community? Is there food around? Are people out there fishing? Are they snowmobiling?

In the summer, are there parties and festivities? In January and February, there's ice culture. There's ice fishing.

Michigan is weird, like compared to people that are used to Sunbelt states. This is a weird state. But I'm telling you, Michigan people—they are used to snow; they're used to ice.

What do they do in the winter? They find ways to enjoy it, right?

We still have snowboarding. We still have skiing. Nothing like the Appalachians or the Rockies, of course, but people find ways to get out there and enjoy it. I honestly think, with the introduction of STR Insights and AirDNA, how much more data there is now, what you can do is kind of the enemy method at this point.

You can look at properties that are in the area. There's usually a handful—maybe there's 15, 20, depending on how dense you are. If you're in an inner city, it could be…

Jeremy: Whereas five years ago there was, like, nothing. So now there's actually..

Matt: Literally, there's my property. Like, "Oh, that's mine. Oh, that's mine. Oh, that's mine." That's what it was, right?

Jeremy: But now, now you've got neighbors.

Matt: Totally. And, like, think about Orlando. Like, Orlando is one of the most saturated communities, right? I bring it up…

Jeremy: Like, 35,000 in Kissimmee.

Matt: Dude! Exactly. Like, think about how dense it is over there, but they're still finding ways to gain traction. New things keep popping up every day, and they're outdoing each other on furnishing, styling, and amenities, right?

So what do I do here? I just make sure to out-furnish, out-style, out-amenity anybody else in my local area. I make sure my property is so cool, like you go—even if it is more expensive, I want to stay at that property.

And I've literally got one—I got one with a shoutout to Sarah Karwell. Oh, sorry, Glidewell of the Karwells. Yeah, we got one.

Jeremy: I got—that happens to me too;

Matt: It’s their fault. Emily’s awesome too—that's her partner. They both bought properties with me too; they’re awesome.

But Sarah and I decided to take a shot at this property called Orange Cadillac now, and it worked out smashingly. I even—I ran it by Kenny. Kenny was like, "I see the property. It's beautiful. I see the amenities. It looks awesome. I would want—

Jeremy: but I can’t. There’s no data to suggest..

Matt: He’s like, "It’s crazy. I don’t think you’re crazy crazy, but this is too crazy."

And I was like—and I didn’t take offense to that. And Kenny didn’t mean offense. Kenny’s awesome. I love Kenny. But I said, "Kenny, I’m going for it. I’m shooting it." Because…

Jeremy: I remember—Sarah posted on Instagram, like, "Hey guys, I love this property, but there’s just no data out here. So, like, please someone, like, please someone buy it."

And I looked it up, and I was like, "Damn, this might be one of the sickest things I’ve ever seen." Like, you’ve got the rooftop pool, you’re like a half block away from the downtown area, you’re two blocks away from a lake.

I was like, "Damn, this just looks so sick." And then the next day, she was like, "Never mind, under contract. Sorry, I couldn’t. Like, I don’t care about the data. Let’s just—"

And that’s what’s kind of, I think, cool or funny about short-term rentals. A lot of the time, there are some intangible aspects of things that really is that vibe. Like, I’m gonna call it the vibe. I’m gonna call it the Matt Vibe Method.

We got Maddie Ice in the house. He just goes over; he sees people on the ice house. But, you know, he knows that. He knows that people want to go there.

And I bought a house, one in the Smoky Mountains, and I actually bought it from Tyler, who we’re talking—before this. But it was like, no data on it. You couldn’t even try to say there was any data.

But it was just like, I just know this is a cabin with a view. And so, if we renovate it, add some more square footage, it’ll be a big cabin with a view. And that’s like—that’s what people want. Even if they’re willing to go an extra 40 miles this way or that way to get it.

So I guess my point here is, like, you guys did that property. Walk me through—because I think Sarah was explaining that deal to me, and I want to kind of parlay this into how you’ve leveraged partnerships to grow your portfolio.

But how did you guys—tell me about the inner workings of that deal, because that was a pretty unique one.

Matt: Man, I don’t even know where to start. Do you want to talk about the property or the process and partnership?

Jeremy: Yeah, first let's—we can paint the picture of the property. And yeah, we can paint the picture. I mean, it looks—it’s, I mean, it's big, and it's orange. It's orange.

Matt: Yeah, it's definitely orange. Yeah, it actually matches very well—actually this strand right here.

So this property—like, if you looked at any hundred properties that were lakefront or lake-proximate in Michigan at the time, when you saw just the listing photos alone, you’re like, "Dude, that is cool. There's something so cool about this."

Jeremy: And people didn't want it. People didn't want to buy it personally because it was, like, so close…

Matt: it was over-engineered. It was ridiculous. It would not have made sense for most modern families. And it was one of the most expensive houses in the city and sat on the market for about 100 days. We actually have gotten a lot of crap from people saying, "You stole this. You took away housing from our family."

Nobody touched it for 100 days! It’s the most expensive property in the area. Like, do we—let's be fair, right? Sorry, I get a little raspberry.

Jeremy: I got enough of those too. Don't worry—you’re in good company.

Matt: So we're looking at it, and I’m like—I send Sarah and I—we would do almost weekly—we’d go through a bunch of properties and kind of go, "Hey, what do you think of this? What do you think of that?" And I kept bringing this one up.

She’s like, "Damn, dude, I like this one." And I was like, "That's what I'm saying! I think there's a chance." And then one day, it just clicked, and we started underwriting it—started getting serious about it. Like, we think it might actually work.

And so, one thing that was helpful that helped me even want to pull the trigger on it was actually Sarah. This is where Sarah shined brightly—"Bite-ly." That’s a funny joke because she was one of the first people I ever knew that brought a quality Airbnb that was, I would say, at the time—it’s probably still—she does a really quality design, really high quality, one of the best in Michigan, period.

I think I’m number two—but number two by a margin.

But Sarah did Bitely, which was—if you understand the sizes of lakes, it's like a 50-acre lake, which to me is a freaking pond. And Bitely is the size of this block, pretty much. It’s so tiny—nobody in Michigan has really heard of Bitely.

Matt: And she went for it. And if you want to talk about a brave woman—that woman was brave. Like, I would have said no.

This is where Sarah taught me to double down on the feeling of creating a truly attractive property that kind of can soup to your point of your comfort of what you bought with Tyler—something that will say, "Screw it, I'll go 40 miles this way. I was going to go to Cadillac or Traverse, but I'm gonna go to Bitely today."

And that’s what she did. She created such a beautiful home in Bitely, a no-name city—in fact, no offense to the Bitelians, but it was effectively a pond. But she was—she was able to create, I think it was a six-figure producing property on maybe a—I think it was a 300 or so buy.

Just phenomenal. Just phenomenal.

And then I kind of started duplicating what we were doing with Cadillac and what I saw her do with Bitely when I did with my other previous rentals. Started buying on other lakes that people wouldn’t consider.

And what did I do? I started making money. I remember I bought one on Gun Lake. People said, "Hey, I don’t think that’s going to do well." It’s a set—actually, even ironically, I think one of Sarah’s relatives said, "I think Gun Lake is terrible."

And we made 11K all of our first months there. And I was like... kind of worth it. So, I bought it at 350. I was like, "That's worth it to me. Like, that's a great buy."

It's hard—you can't buy that again right now, I'll tell you that.

Jeremy: What's the Cadillacs? Because I think you guys probably have about a year's worth of data at this point, or we're getting close to it.

Matt: No, it's flown by. So, yeah, going back to Cadillac—sorry for the segways.

Jeremy: I'm just curious. I mean, because you guys got it at, like, 500, right? Cadillac was 500.

Matt: Yup, 500. Put a good amount into furnishing—you did a little bit of rehab to it. Did a pretty good amount of rehab, actually. If I had to say, it's probably worth 600, 650 right now. Maybe 650.

650 is probably more accurate, but with the work we put into it and launching finally in January, this is the truth: this is the seasonality factor. It was a terrible time to launch. Terrible. January is not a sexy month. Ironically, November and December are pretty solid year-round.

Jeremy: Thanksgiving and Christmas.

Matt: Yeah, lakefront or otherwise. November and December are pretty solid. But January, February—dicey. February is almost always not good. And then March came. March actually was like, "Oh, hey, we broke even." I'm like, "That's a good sign. We're finally starting to get some bookings. We're starting to get somewhere," right?

And before you knew it, we had—I think this was three weeks ago, maybe four weeks ago now—we found out for the three main months of summer, we had already booked $100,000 alone on just summer. Just those three months.

Jeremy: Yes, during July, August?

Matt: Yeah. On a half-million-dollar purchase. And I was like...

And what we found is, summer on lakefront—it’s not a perfect number—but it usually counts for about 50 percent of the income you're going to make for the remainder of the entirety of the year.

So if we double that, if we get $200,000 on this, it'll be one of the best buys we will have ever experienced. It did take a high level of risk and betting, but we were able to validate it to ourselves and our investors.

And what we did—Sarah and I were planning to buy it solo.

Jeremy: You know, guys, I'm going to do it. I'm going to find this damn Airbnb because we're talking about it. So I will find it. Keep talking, Matt. I am finding the orange Caravan in Caravan, Michigan.

Matt: Uh, this is a Cadillac. Cadillac, Michigan.

Jeremy: Oh, Cadillac—Orange Cadillac. Not orange Caravan, sorry.

Matt: Yeah. Or—I don't know. I got the picture of the Dodge minivan now or whatever it is. I think it's Dodge Caravan. Yeah, but anyway, yeah, that house—Sarah and I were gonna buy it.

Jeremy: I love how I just see. And I see, like, $64 a night, $200 a night, and then $724 a night. Is that right?

Matt: That's about right, man. That’s about right.

Jeremy: Looks like, it's beating the comps by a little bit.

Matt: I don't know. No, it's been good, man. It's been real good. So, this house—we were gonna buy it just for Sarah and me. And we had some people that were interested in coming in and investing with us, and we're like, "You know what? If we could set up a structure that works well enough, maybe we can bring—oh, here we go!"

Jeremy: Yep, I mean, just look at this. I mean, for you guys on Spotify, I apologize. I can paint the picture for you: it is a well-majestic backyard with string lights, fire pit, hot tub, pool,

Matt: Heated patio, waterfall, pizza oven…

Jeremy: Just everything. I mean, I don't even know what—yeah, every. Amenities galore. Yeah, on the inside, they've got like a speakeasy room that has a pool table, a bar.

Matt: It's got a hidden entrance.

Jeremy: You know, surprised you guys didn’t do anything with the garage, honestly, but I guess maybe that's actual parking?

Matt: That's actual parking, especially in the winter. People are going to want to use that.

Jeremy: Yeah, I guess that's a Michigan thing. I don't really ever think—for me, garage equals game room.

Matt: Yeah, no, for sure, for sure. We might do something for this coming winter, but right now, we're like, "Let's get this thing ready for summer." And over here, plus, this was our first pool home. So we were also trying to get used to, like, how we're gonna run a pool. We never had a pool here. My first…

Jeremy: How many months a year can your pool be available?

Matt: 4-5, 4-5 months.

Jeremy: You’ve got good reviews here. Maybe you might want to get on the cleaners a little bit, but other than that, pretty good.

Matt: We replaced two cleaners. I will say, getting cleaners up north is tough, man.

Jeremy: I believe it.

Matt: It is tough. Yeah, our big—we actually, not to be too rude here, I'll just—saying as a fact, you can interpret it as you will. We had a cleaner that just didn’t show up a few times. And the last time, we’re like, "Hey, you haven’t shown up. Where are you?"

And after, I think it was the next day, we heard, like, "Oh, I’m birthing a baby." I’m like, "You could—you know we didn’t know you were pregnant. A little heads up—we could have worked with you!" Of course, we had to let her go because I’m like, "We can’t afford that." And those were the reasons.

Jeremy: You can’t just not tell.

Matt: Yeah, so it’s been tougher. I will say, the biggest thing about more rural areas is finding consistent workers, especially at the turnover speed you need. Like, you need them to do consistent once-a-week cleanings—you’re gonna be fine.

But if you’re looking for people that can sometimes do two or three cleanings in a week, that’s a much tougher cleaner to find. And handyman—they usually drive a longer distance, and they also are sometimes just a little slower.

That’s all. Like, the work’s good, but yeah, those are the challenges with rural. But after a few trial-and-error moments, you usually always get it figured out.

Jeremy: Exactly. And I think something I talk about is that being in rural areas is kind of a moat if you have an operation there. Because big-time investors who have a bunch of short-term rentals already—they want to go where it’s easy. They want to go where they have handyman or they have cleaners, where they already have their operations in place.

They don’t want to go to bumble—bumble crap—have to call 20 people to find out whose brother or sister knows how to change a light bulb, or who can clean on this day of the week, and who can clean on that day of the week.

Like, in rural areas, there's not just turnover BNB—they’ve got to use Facebook groups. You’ve gotta—you gotta talk to people.

But in my opinion, that's kind of a moat. And I don't know if you’ve seen that, where supply is kind of constrained in some of these rural lakes because—and also people doing it well, the professionals don’t really go out into all these places because there’s just—there's a little bit more friction.

Matt: Yeah, it’s funny you say that. So I know we're—I know we've segued a few times. Forgive me, forgive us. It’s like that enemy method, right? That, and also looking past the data that’s currently present.

Like, there’s a deal—it’s a million-dollar deal in Michigan. And one of my clients reached out to me about it. I was like, "Damn, that’s actually a really cool house. Like, it’s worthy of being a 1.1-million-dollar house, right?"

And I think it’s like a six-bed, five-bath. Massive, right? It’s right on the canal, going out to a lake. Which also feeds into Michigan, and we're looking at it and seeing that the data for the actual house—it has been on Airbnb, but it's been used as a second home. So, it hasn't really been pushed as an actual investment.

Meanwhile, there are other homes nearby that hit, like, in the 200s—230, 240, 150. We've seen a couple other comps like that, right? And so, I was just explaining to this client because they really wanted to get, like, "I want to see the Airbnb data. I want to see the Airbnb data of what they have." And I was like…

Jeremy: It doesn't matter. Throw it out the door.

Matt: That's almost exactly what I said: "It won't matter. They never really treated it like an investment, so usually, you're going to see it—it's going to show nothing, right? Well, let's look at what the other ones are. Let's consider the enemy method, right?"

When you looked at the 224, the house was a hair smaller and honestly not that attractive. The other 230 or something was a brand-new build. It was right there on the—on, I called it the ocean because Lake Michigan, when you look at it, it looks like an ocean. It's huge. It’s freaking—it’s a Great Lake, right?

But on the Great Lakes, and it was gorgeous. But I still felt this other house could have amenities that are not present on that. My point was, I was trying to anchor the idea that this should be a $200,000-plus earning property.

And I said, "You can sit at a game room with this three-car garage that's already there, the unfinished—or no, the mostly finished—basement. A hot tub hasn’t even been added." They said, based on the data they had with their Venmo and Zelle earnings, they had made, I think, just about $100,000 by renting.

Jeremy: Which is impressive. Yeah.

Matt: Yeah, yeah," I’m like, "If they improve it or not, if it's about right, that still gives merit to the idea that it could make $200,000, right?

And in fact, there are multiple homes in the area that show $200,000. I was like, "I think there's a good shot here. So yes, it's about what? Is it hitting 150, 175, 200, 230? Can your home be better than all those as it's just a home? Yes. So, it should give you a really good shot of staying in the $200,000 range, maybe even exceeding the top data point of the $230,000.”

So, it's like, you gotta look at those things. Even on my inner-city stuff in Royal Oak, there are a couple homes that hit $75,000 to $120,000.

And my last primary, before I moved into this, is in Royal Oak too. And we said, "You know what? Let's get weird. Let's do a crazy theme." So, we did the most marble theme that's ever even touched Michigan. It's like—not, I wouldn't say we would be a killer in Orlando, but we'd probably hold some water.

But we said we want to do something. I wanted to go a little bit more edgy. We did it. The reviews have been stellar. We made $10,000 our first month of being launched. We were booked the same day we launched.

And all we had to go on was, "We can make 75 to 120 here." "If we do what I think we're going to do, we might hit 150 on this house." Because we looked at what's there, what's good, what's not good, we said, "We can be better than what the best is. We can do that."

And plus, like, our quality of our fixtures, our furnishing, our attention to detail—my wife’s... I think we have over a thousand five-star reviews, superhosts since it started on our account. I think she's like a 4.95 average. It's like, we could probably run this thing right.

So, that's what we're doing, man. We got some special sports team, like big players, that are gonna be renting it for a golf outing coming up. Can't say names, but it's kind of cool.

Jeremy: It's just cool to see that, like, yes, marble can even work in random Michigan. Actually, that's funny because, well, two things there that I want to touch on.

First, like you said, you had a client who wanted the current owner's data to make the investment decision. Where, yeah, I have—I'm not a broker, I'm not a real estate agent, but I do have a mentorship program. And I have mentees who—they're looking to arbitrage a property in South Florida.

This will be the third one that they do, and it's currently an Airbnb. Absolutely garbage photos. You look at the photos on AirDNA, you can see the Airbnb account on one side and the Vrbo on the other as the comps, and it's looking terrible.

And they asked me, they're like, "Can you add them together if it's Airbnb on one and Vrbo on the other?" And I was like, "No. You just throw it out. Like, just throw that out. Throw that data out."

It has, like, one review in the last year. Like, it looks like the host isn’t accepting bookings. You put in a request to book—they don't actually respond and accept it. Their response rate is like zero percent.

I'm like, "You throw it out." They're like, "Well, what do you—" "Nope. Throw it out. That's not a data point."

Matt: I like how direct you are. That's how I feel too. It's like, it's tough because you want to help, you want to educate, you want to, like, be the Prometheus, right? You want to bring fire to the people.

Jeremy: I wish I could say, "Oh, it's an average daily rate of $529 with a 66% occupancy," but I'm like, I can't. Like, this isn’t…

And then, the other point I want to touch on was that you're doing a themed Airbnb place where nobody does it. And actually, this most recent house that I'm doing—that I'm kind of trying to do the same thing—be like, "All right, I'm gonna go a little Scottsdale with it."

I know you said Kissimmee with the Marvel. For me, it's like Scottsdale. The house has a pool. Like, I kind of want to do a little bit of Scottsdale, but then my designers designed it, and I was like, "I don't know if the market needs that much Scottsdale."

Matt: Like, yeah.

Jeremy: If you're in Scottsdale, it has, like, the theme—the wallpapers for the golf, the little putt-putt—that's, like, the big signature of Scottsdale. So, as long as we're doing a little bit, we're doing a thousand percent more than anybody else.

So, like, yeah, you're not doing Marvel as well as Kissimmee or Orlando area, but you're just doing some of it when nobody else is doing it at all.

Matt: Yeah, yeah. Because we wanted to be able to rebalance, like, a more normal, manageable style if Marvel was a complete, like, loss. I was pretty confident it wouldn't be, but yeah, it worked out.

Jeremy: What I want to get into—because we only have a few minutes left here—I know you've been doing boutique hotels. I didn’t get one in California, and I know—I think you're doing one in Michigan. Maybe I'm wrong; we haven't talked since then. But yeah, boutique hotels. What happened there?

Matt: Literally, I'll tell you. So, long story short, the boutique hotel was technically two properties, and we were having some trouble after appraisal trying to keep everybody in line with expiration and contract.

And we found that we couldn't buy both the properties that were side by side. It wasn't going to be worth it. So, we couldn't buy one and validate it; we had to buy both.

One of the sellers was not very amenable, so we finally exited probably, like, 30 days ago. It was the longest, most painful experience. And honestly, it got really emotional for all parties—very tough.

So, yes, let it be said that Matt does not win always. I pushed really hard on this one. I really tried like hell to make this deal work, but it just unfortunately fizzled. And sometimes, that's par for the course.

We lost probably $20,000?

Jeremy: In diligence, or?

Matt: Yep, diligence—mostly EMD was written off. We got pennies back, more or less, just because we got sick of the fighting back and forth.

Jeremy: And you had one seller who was amenable, but the other one wasn’t willing to budge to make the numbers work, correct?

Matt: Correct. Yeah, well, one—and it’s funny—the one that was really sweet, like, I really, for her, was almost the only reason I was still doing the deal because she was a really sweet lady. And it is what it is. But she was going through some stuff too.

That being said, I'll tell you about the California deal. And this is, like—I know this sounds weird, I know a lot of people talk about their wins, but I like talking about my losses because I learned, like, crazy amounts on those.

And honestly, commercial world is freaking tough, man. I know now—now that I've had my lashings, if you will, I've had my whooping—I know what to do. I came in as a third partner on this hotel, and I got brought in because they were looking at some other properties.

And I told them, "Nix this one. This is a terrible move. I promise you'll get burnt." And they're like, "Holy crap, like, you really know your stuff. Thank you for looking out for us. Most brokers would just say, 'Buy it, it's great.'"

I was like, "No, I'm not that type. I actually want to have a relationship with you that's not burnt." And so, they went—they canceled that. They said, "Hey man, how do you feel about coming out of this hotel with us?"

And so, by just being a good dude, they’re like, "Hey, come on in." I got a chance to buy, and I bought in. Now, here are some of my takeaways:

I didn’t do enough due diligence. I trusted—this is not a knock on the partners per se—but I trusted that they had done the due diligence. And it was kind of... I came in at the ninth hour, which was not a good move.

I won’t do that ever again. If I don’t start the deal, I’m not doing the deal. Or it’s not something that’s got a history of a really strong track record of doing Airbnbs or boutique hotels.

So, the idea was to develop the land around it, right? Found out later they didn’t have as much capital as they suggested. They had it, but they spent it elsewhere—I didn’t know that. That became a challenge.

This deal was completely dependent on the development of the lots of land that came with it, as well as a single-family home that came with it. So, the first thing we did when we got it, we reneged on some of the processes. We also steered away from the initial goal. It was a pivot, you could say, in the moment. But by doing that, it really hurt a lot of the initial play-out.

And the final straw that really hurt this property—aside from Coachella being an amazing month. Coachella did, like, $40 grand for Coachella week/month, rather, the styling.

I’m big on doing really unique styling. Especially if, like you said, Scottsdale, right? You can’t do the same boring thing everybody else does. You gotta do something unique. Be bold. And I said, "Let’s be bold. Let’s do something different."

And one of the partners is kind of a traditionalist. "I want to do a very conservative approach. This is what’s going on in the area. We should do this." I said, "I fully disagree. We gotta go. We gotta go hard."

And I got outvoted, which was kind of a bummer. We did it—it turned out nice. It was a nice update, but unfortunately, it didn’t stand out. And if you look up—I think it’s called the Trixie Motel—they did an outlandish thing. I won’t say it on air, but if you look it up, it’s outlandish. Very bright, very interesting, and they crush it.

They have the highest ADR of any other place in Desert Hot Springs—and Palm Springs, probably, for that matter. But in the end, here we are now. We’re looking to sell it, actually. It’s listed, like, for the right person to take it over.

We talked about maybe we should pull the capital, build this thing up, get the development done that we needed to do initially. But honestly, I think we just kind of all got beat up on it. And I think somebody else should take this into the end zone and crush this property.

Jeremy: You’re gonna walk out—like, you’re gonna walk out even, up, down? If you want to be honest.

Matt: it’s going to be a little loss. But you know what? Sometimes you gotta pay. You gotta pay for your lessons, man.

And luckily, when I did this, I knew that was a chance. There’s a chance that it would be the case. It’s not going to be detrimental, but it won’t be, like—it won’t be a proud moment.

But that’s the key, man. If you are only learning from people that only have wins and have never experienced loss or, like, "Oh sht" moments—Who are you learning from?

You, like, you can’t. Something that just happens to be... some people are freaking lucky. Let’s just be honest—some people just, all they do, they show up their way. That’s awesome for them, but you can’t teach people luck.

You can teach from experience though, right? So that’s what you’re able to do.

Think about how you and I have both been able to go out there, form partnerships around buying and acquiring properties, to the point where we built up everyone’s confidence. Everybody’s experiencing success. We troubleshot, we made individual decisions that were hedged and leveraged by having a fraction of our capital in it, but using other people to be a part of those decisions.

So, if you had five people now gain that same experience step, which has also made it easier for you to grow as an individual and continue to buy properties on your own now, right?

So, it’s what you and I did. We had exponential experience by having all those conversations over and over again, looking at it from different angles, and coming to some agreement, right?

And that’s also—it’s funny because as you get better and you have so many successes, you open yourself up to new asks, probably because you get bored, right? And so, to be frank with you, the hotel was something I was like, "I’m scared of it, kind of. I’m kind of bored. I’m going for it."

So, I took a risk that I knew could be damning. And it wasn’t damning—hurt a little bit, but nothing I can’t recover from, right?

But now my next hotel—I was hoping it was going to be that Long Lake hotel that you knew about. It didn’t pan out, but not because I didn’t do my due diligence. It didn’t pan out because I couldn’t keep most sellers in tune.

My next one’s gonna be kick-ass. I’m sure of it.

Jeremy: Got it. So, what would your pro tip be for anybody listening?

Matt: Oh, man. Pro tip—most people are probably newer, right? Probably have sub-three properties. One big thing I want to push on is: buy.

Arbitrage is great for testing the waters. I did one arbitrage that was successful, but nothing teaches and also creates—there are three ways to make money on the buy, right? There’s the appreciation, there’s the cash flow, and there are the tax benefits.

I am a huge proponent of buying. I think buying has been huge. And the thing I’ve undervalued most in my success is how much my properties have appreciated, and how crazy beneficial it is to switch from long-term rentals to short-term.

The amount you can write off legally on short-term rentals is asinine. If you aren’t doing short-term rentals, if you have a long-term rental portfolio and you’re in good enough areas to do short term, for the love of God, switch. Switch.

Get those tax benefits. Enjoy it. It’s been great.

Jeremy: Listen, I talked with Ryan Bakey, who’s a short-term rental-specific CPA. The specific tax benefits to short-term rentals—I think we touched on it pretty well there.

But yeah, Matt, if anyone’s listening, how can they find you and how can they get access to the deals you’re sending out?

Matt: Really simple. If you go on my Instagram, TikTok, whatever, check my link in bio. I got an option to sign up for the email list at the bottom and my STR Legend course at the top.

So, if you need anything, just let me know.

Once you’re on the email list, double-check your spam. It comes from my Mailjet account. Sometimes the first one goes to and bounces into your spam, so make sure you check it. Mark it as not spam. But you’re gonna see my emails are not spam.

If you’re looking for good Michigan deals with some actual real underwriting behind them and real history, real data that’s been used from my experience, I think you’ll like what you see.

And hopefully in the future, Jeremy and I will have something to combine powers on and share with you guys.

Jeremy: Exactly. Guys, stay tuned for that. And yeah, Matt, thanks so much for coming today.

Matt: Thank you, brother. Really great catching up, as always. Look forward to catching up again.

Jeremy: Guys, that’s a wrap. Stay tuned for our next episodes. And as always, give us that five-star, share it, send it to your friends. This grows through word of mouth, and we’re here just to help you guys out.

And I hope you guys appreciate that. So, everybody, have a great day. Matt, see you later.

Matt: Thank you, brother!