Cohosty’s Origin Story

Have you ever yearned for financial freedom? Or thought that there has to be more to life than work, eat, sleep, repeat? Do you have a deep desire to stop just treading water and finally start making some progress on your goals and dreams? If you answered yes to these questions then, we are the same. Cohosty exists ultimately because our answer to these questions was yes. Read on to learn more about Cohosty’s origin story and our journey from ‘there must be more’ to ‘oh, right, there is!’ and maybe find some inspiration to make moves of your own along the way!

A Little Background

Kevin and I both grew up with all of our basic needs met and we are grateful for that. We know that we are incredibly fortunate to have been loved and had food and clothes and education. That being said, there were a lot of things that we wanted and couldn’t have. “Money was tight” and “doesn’t grow on trees” were common phrases in both of our homes at different points. We were taught to study hard, find good jobs, and work hard. And this is what we did. Our early adult lives were spent grinding and eating ramen and grinding some more. Even though we were doing what we were supposed to – by working hard – money was still tight. This just didn’t seem right to us. To work so hard just to pay bills and have little left over. We wanted to travel and have nice things and have money left over to help a friend out when they needed it. We wanted to spend quality time together and with friends and family but we always seemed to either be working or be too tired from working to do much else. At some point along the way, we found a book.

The Mindset Shift

Rich Dad, Poor Dad by Robert Kiyosaki literally changed something in our brains. It was a small shift at first and took a little while to grow bigger but it was an instant and noticeable shift from ‘we can’t afford that’ to ‘how can we afford that?’ This seems like a very simple distinction but it is so powerful. It was what made us really start to understand that more was possible and it was up to us to figure out how to achieve more. Rich Dad, Poor Dad is a fun and easy read and it teaches the importance of making your money work for you. It’s not enough to just work and make money. Once you get the money, you have to put it to work for you through investments like real estate and entrepreneurial ventures. From the time we read this book, on, we have been searching for ways to make our money work for us and finally found our path couple of years ago when we decided that we wanted to move.

The Move That Started it All

In 2021 we decided that we needed a little more space. I’m sure the pandemic helped a lot of people realize that. We wanted a garage, an extra bedroom, and a bigger kitchen. The only problem was, we loved our townhome. I was very attached to it. We made a ton of improvements in the 6 years we lived there and poured our hearts into each project. It was my first real adult home and I wasn’t ready to let go. So while we searched for the new place, we also started researching how to keep the old place. We found a few good books: Rental Property Investing and Managing Rental Properties by Brandon Turner. These books helped us learn how to find tenants and be landlords. It also led us to Bigger Pockets which is an excellent resource for all things Real Estate. Every question we had could be found on Bigger Pockets and if it wasn’t already there, we could simply ask and the incredible Bigger Pockets community would respond with their knowledge and advice. No gatekeeping here! We interviewed something like 10 potential long-term tenants before we met one that wanted to use our place as a sort of rental arbitrage. This means she wanted to pay us what we were asking for a long-term lease and then turn around and rent the townhome to short-term tenants. You can charge a higher nightly rate for short-term stays than you can for long-term stays so while we were hoping to make a couple hundred dollars a month in cash flow off of her long-term lease, she would be potentially be making between $500-$1500 off of her short-term tenants. We did not feel comfortable allowing someone else to run a business like this out of our house so we declined her application but it got us thinking hard about short-term rental vs. long-term rental.

STR vs. LTR

Once we started researching short-term rentals we realized that we were much more interested in this route. A few things we considered while trying to decide between STR and LTR were:

1. What was the difference in income? We had already decided that LTR would cash flow around $400 per month (based on the going rate in our area for 2 br/2bth homes and also the conversations we were having with the potential tenants). To determine how much we might make with an STR, we found PriceLabs (a revenue management system that shows you how other STRs like yours are doing in the area). Pricelabs showed us that we could cash flow close to $2000 per month off of our townhome! STR was a definite winner in the income department!
2. What was the difference in workload? A long-term tenant could have maintenance needs periodically. We would hope to have been able to trust in our interview process to ensure that the LTR tenant wouldn’t be unnecessarily needy so we did not expect a high workload for the LTR route. With STR, the unit has to be cleaned after every guest and the guests need to be managed. From bookings and cleanings, to ensuring that the hospitality items we would provide are always stocked, we realized that the STR route would require a great deal more work than the LTR route would. However, Kevin and I are both very experienced in customer service and had brain space and time to deal with these things so we were not swayed.
3. Will the HOA allow short term rentals? We checked our HOA guidelines and they didn’t explicitly say we couldn’t use our place for short-term rentals, so we decided to go for it!

Ultimately we decided that STR was the way to go because if it didn’t work, we could always switch to LTR but if we did LTR, we would have to wait for the LTR tenant’s lease to run out before we had another shot at STR.

Setting up for Short-Term Rental

We made the decision to try the STR route about the same time as we found our new home. So as we were packing and planning for our move, we were careful about choosing what would stay and what would go. We knew we would need to keep the townhome furnished for our STR guests so we had to decide what furniture we were going to leave at the old place for our tenants and what we would take to the new place. This actually made our move a little simpler because we were basically just moving our personal things and leaving the bulk of the furniture and kitchen supplies behind. We have a whole post dedicated to furnishing a new STR (Check that out here Short-Term Rental Amenity Checklist ). Once we moved into our new home, we had the townhome professionally deep cleaned and then got to work stocking and decorating.

Photos

Once we had the townhome all set for our guests, we had professional photos taken. We believe the professional photos are a non-negotiable. They WILL make a difference in whether or not someone chooses your listing. Do not invest your time and resources in a business and then skimp on something as important as the photos.

Listing Setup and Optimization

Once we got our pictures back, it was time to list our place on the popular short-term rental platforms. We decided to stick with Airbnb, VRBO, and Booking.com. We focused on one platform at a time and once section at time. We researched titles and listing descriptions. We went through our home room by room and made sure to list all amenities that we offered.

*Side note* We understand that some people are intimidated by this process or just don’t enjoy it. However, we do enjoy the process and based on our high occupancy rates and Super-Host status, we believe we are really good at it. Listing Setup and Optimization is a service that we offer and we would absolutely love to help you get your listing up and running!

Once we got our property listed on the platforms, we decided to also use a channel manager (Guesty for Hosts) so that we could stay organized, keep our calendars synced, and create automated messages. Then we went live!

Guest Management

Once the listings were all set up and live, we started getting inquiries. We set up a discount for our first 3 stays on each platform and had those first guests booked in no time! We were confident that the attention we paid to our listing set up, professional photos, and pricing management played equal parts in our early booking success. As we communicated with our guests and cleaning crew, we made adjustments to our amenities, rules, and automated messages. We had a few hiccups along the way but overall, we have had amazing guests and are thoroughly enjoying interacting with new people on a daily basis.

How Did Cohosty Start?

After launching three successful STR’s, Kevin and I were hungry for more. We fell in love with the process and wanted share what we’ve learned with other hosts. We’ve learned a lot about increasing occupancy, guest satisfaction, and ultimately revenue. We thoroughly enjoy every part of this business. If you are finding that you are not enjoying the process, are struggling to be successful, or are just not quite sure how to get started, Cohosty is here for you!

Where Are We Now?

We enjoyed three very successful months with our townhome as an STR before the HOA reached out and strongly encouraged us to switch to LTR. We found a guest that wanted to stay for about 6 months and while we strongly discounted the nightly rate for this long stay, we still were able to cash flow a good bit more than if it had been a longer term lease. While we hosted this last guest, we decided that we weren’t ready to give up the cash flow of STR for LTR and the way the market was at the time, we were able to profit a great deal in the sale of that townhome. We knew that we could take that profit and reinvest it into a new property with no restrictions on STRs and so, when our 6 month guest left, we sold our beloved townhome. We now have an Ocean Front Studio Condo in Myrtle Beach and a Modern Cabin in the Mountains of NC and both perform really well. At this point, we have been Super Hosts for just over a year and have hosted over 200 guests. We’ve had a few guests that weren’t as great as all the others but for the most part, our guests have been wonderful and we are thoroughly enjoying our experience in the short-term rental world.

What’s next?

We are currently working on obtaining financing and finalizing details on another cabin in the mountains. This is an extensive but exciting process that we will share with you all soon. We are also learning about creative financing and plan to use some of these methods to obtain more properties in the future. As far as content goes – we plan to break down each part of the STR process and share that with you here, so get ready!

What’s next for you? Send us a message and let us know how you are working toward your goals and visit Our Services page to see how Cohosty can help you succeed!