How We Created One of the Highest Performing Rentals in Forks, Washington
A case study in short-term rental hosting, experience design, and service.
About Us
I'm Michael Dinwiddie, my wife Rachelle and I have stayed in over 35 short-term rentals across 6 countries and we have hosted over 75 groups at our own rental.
My professional background includes an MBA in strategic consulting and roles in product marketing and customer experience design. I have worked in the travel industry since 2020, so I've seen firsthand how group travel has shifted to vacation rentals.
Because of all this, in 2022, we acquired our first property near Olympic National Park, which quickly became one of the highest-grossing properties in the market.
Identifying What Makes a Winner
The key to a profitable investment is analyzing the market & property thoroughly.
Selecting a Great Market
You have to balance personal preference and income potential. We wanted a rental that was within driving distance from our home south of Seattle, in a fun area, with good ROI.
We identified a dozen cities and towns in a 5-hr radius with strong short-term rental presence. We researched and evaluated home values and rental potential for each market to determine average ROIs (today, we use online tools like STRinsights.com and Airdna.co for faster and more detailed analysis).
Through this process we discovered the town of Forks on the Olympic Peninsula. This small town had multiple traffic drivers being home to the popular Twilight book/movie franchise and more importantly a key basecamp for the 3 million annual Olympic National Park visitors. Our research showed high demand (particularly in the summer season) and affordable, but limited rental homes. An ideal recipe for a successful market.
Finding a High Potential Property
A lot of homes make good rentals, so long as they are safe, comfortable, and affordable. But a great property requires a lot more.
It needs to have great curb appeal, standout features, or a prime location. The more of these elements a property has, the more protected the rental will be from demand fluctuation (a beachfront home is always going to get more attention than a property where you need to drive to the beach). Plus you need to match, or beat, the amenity offerings of your competitors.
We found a rare, newly constructed, home with modern finishes and an open floor plan. I completed a full amenity analysis and discovered the top performing homes in the market had hot tubs and had converted their garages into game rooms with activities like ping-pong and foosball in them. After reviewing historical rental data of the 2-3 rentals our potential property would be competing with, I determined this property would generate around $80-90k gross revenue annually.
The Results
Market Topping Revenue
2023 revenue surpassed main competitors by over 20%.
Massive Profits
Generated annual cash flow of $45k.
Positive Impact on Travelers
Hosted over 500 travelers who created core memories in the rental property while exploring Olympic National Park.
Added Bonus
Our family has been able to stay in the rental for 14 nights in the last year, creating memories for ourselves, our children, and our friends.
Designing a 5-Star Guest Experience
Target the kind of guest who is willing to pay a premium for experience and you'll have higher returns with fewer problems.
Setting up the Physical Space
Decide on a style and then stick with it. We chose a minimal Scandinavian design and spent hours curating design inspiration boards on Pinterest for each space in the home. Create a clear vision.
Acquire quality, durable, furniture and home goods. Don't overlook any details – even a missing wine opener can spoil the experience. We purchased 304 home goods (roughly $30k in furnishings) for the new property in just one week. It took us five 14-hour days to unbox and set everything up
But buying great stuff isn’t enough, a five star experience is built on the little details. A few examples include:
Labeling the kitchen cabinets so the guests don’t need to open 10 drawers just to find the measuring spoons
Providing a waffle bar with Mickey Mouse waffles and sprinkles
Utilizing 3 types of bed pillows
Providing a bathroom stool for kids
Installing foam padding on the garage game room floor
Providing bath toys for kids
Providing a monitor and HDMI cable in the office
Installing a free EV charger
Creating and Optimizing the Listing
Airbnb and Vrbo are the two main sites guests use to search for STRs so it’s not enough to be on just one of them. In our market, we get about 75% of bookings from Airbnb and 25% from Vrbo.
High-quality photos are crucial. Bright, wide, and well-staged photos are key. It's crucial to emphasize the amenities and unique features of your property as well, which is why the hot tub, bounce house, and waffles are some of our first photos. Something we do that 95% of listings miss is a video walkthrough and a virtual room-to-room tour. This allows potential guests to see more of the home and imagine themselves vacationing there.
Value-Adding Communication
Since we’ve traveled a lot, we have seen what good and bad guest communication is like. There were times we didn’t hear anything from the host, and other times they went overboard and were annoying.
We've found a happy middle ground and crafted messages that inform and prepare our guests. For example, we send recommendations for local activities 30 days before travel, packing suggestions 10 days before, and check-in details 3-4 days prior. On the morning of their arrival, we provide a personalized door code and suggest visiting our favorite beach for a stunning sunset.
It’s these intentional little bits of information that create a more positive guest experience.
Developing Efficient Processes
It takes a lot of time and energy to set up a great property, but it doesn't need to take a lot of time to maintain it.
Saving Our Work
We spent approximately 150 hours of work from purchasing to hosting our first guest at our rental. That's nearly 4 weeks of full-time work crammed into evenings and one hectic Thanksgiving break.
However, we've saved everything we've created and can now complete the same tasks in half the time. We have documents such as a
furnishing guide, messaging templates, and property analysis proforma's that we can reuse with new vacation rentals.
Messaging & Calendar Automation
We mentioned how important our communication is in creating a 5-star experience. If we had to type those messages up every time it would be overwhelming and we would not convey a consistent experience.
The reality is that I rarely even think about our messaging process today because it's all pre-programmed and customized with channel management technology. Even the temporary door codes, which are unique to each visitor, are automatically generated and inserted into the messaging.
That system also synchronizes our calendars. So if we receive a booking on Vrbo, it automatically blocks our Airbnb calendar. Likewise, if we change our availability from 3-night minimums to 2-night minimums, it updates across all systems.
Pricing Automation
We also utilize a pricing tool which automatically adjusts our rates based on competitor and local hotel pricing. It takes into account busy weekends, holidays, and seasonal variations. While I still make weekly adjustments to manage our occupancy, this tool has empowered us to list our rental for sometimes significantly more than we would have expected. And guests who stayed at these higher rates love it because they received exceptional value - more space, a kitchen, great service, a hot tub, and more - compared to what they would have received at a hotel or other rental for slightly less.
Overcoming Challenges to Become a Superhost
A good property, great experience, and efficient processes will not entirely shield you from challenges.
We are Airbnb Superhosts
To be a Superhost you need to hit certain service criteria each quarter. The secret? Handling the service challenges well. We believe in the same guest-centric philosophy as Disneyland- the guest may not always be right, but they will always be our guest.
We are Vrbo Premier Hosts
We have achieved similar results on Vrbo.
"The guest may not always be right, but they will always be our guest."
Challenge Example #1 - Propane Leak
In July 2023, an incident occurred where a guest accidentally damaged the propane hose connected to our gas stove. The guest promptly notified us about the fumes and contacted Airbnb services, who offered to relocate them. We provided guidance on safely closing the propane tank and smoothly transitioned them to our secondary tank for the rest of their stay. Without delay, we arranged for a skilled handyman to replace the broken piece the following day. The guest expressed gratitude for our quick response, and we received positive feedback from both the guest and the Airbnb safety team. We not only retained the guest but also earned a 5-star review.
Challenge Example #2 -Locked Out
In Spring 2023, we had a guest who tried to use their door code, but it didn't work as expected. Unfortunately, we missed their initial message, adding to their frustration. After 45 minutes, they called us, expressing disappointment in not being able to access the property. Once we realized the issue, we quickly fixed it and ensured it wouldn't happen again. However, we couldn't help but imagine the guest waiting outside, unsure if they would ever get in. To make it right, we sent them a heartfelt apology message and a $50 gift card to the local grocery store where we encouraged them to get treats and ice cream on us. The guest appreciated this gesture and left us a 5-star review.
Challenge Example #3 - Hot Tub Left Open
During the winter of 2023, a guest arrived to find the hot tub left open, resulting in a significant drop in water temperature and power saving mode activation. The guest reached out for assistance, and we provided step-by-step guidance over the phone. We explained that the temperature would take overnight to rise back to a comfortable level. Recognizing the importance of the hot tub as one of our key amenities, especially during the winter season, we decided to go the extra mile and sent them a $100 gift card. The guest appreciated this and left a 5-star review.
Some may question why we didn't simply refund them $100, which was an option. However, we firmly believe that transforming a negative experience into a positive one holds greater value than mere monetary compensation.
Takeaways
It's not easy to create a top-performing rental in your market, but if you follow the right framework it's possible.
Evaluate markets strategically and balance personal preference with income potential.
Find a property with good curb appeal, a standout feature, and prime location.
Evaluate amenities included at top performing rentals in the market and include as many as you can.
Attract better guests by designing your physical space to be a premium experience.
Increase demand for your rental by creating amazing listings.
Be extremely intentional in your communication, adding value where ever you can.
Use automation tools to save hours of time and ensure calendars and messages are synced properly.
Make sure you implement dynamic pricing software or you absolutely will not maximize revenue.
Handle challenges like a Superhost.
Remember - the guest may not always be right, but they will always be the guest.
We Now Offer Co-hosting Services!
We realized how much we love creating great vacation rentals and hosting groups, so we have begun helping other investors manage their vacation rentals using this same framework.
Owners who work with us:
1) make more money
2) save time & reduce stress
3) help guests make core memories
Contact Us
(360) 564-5996
info@corememoryhospitality.com
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