Two Enterprising Adaptations For Local Houses
Jan 02, 2018 01:20PM ● Published by Emily Stevenson
Principal, Gervais Studio
Airbnb, the home rental concept available on the internet, appears to be doing well around Columbia. Room listings advertise overnight stay prices of as little as maybe forty dollars. The middle of the bell curve is more like fifty dollars. My back room with its shared bath down the hall is renting out for sixty dollars a night, and there’s usually one or two rent nights every week. Airbnb is not renting out houses, not whole houses, but individual rooms at individual prices.
On a far more lucrative level is the whole-house rental for a two or three-day weekend.
Not much more than 10 years ago, a small group of Notre Dame alumni gathered in South Bend after a home football game. What surfaced was a short housing survey: hotels, friends’ generosity, out-of-town commutes, university housing, and even an RV or two.
The idea of renting nearby homes for the football home games was the conclusion of the conversation. South Bend was a great football town, but a football town and not much else. Hotel rooms were scarce on the football weekends.
At first, the Notre Dame housing was provided through close contacts free of charge. Then the concept crept in that there was money in all this.
What happened in Norman, Okla., Chapel Hill, N.C., Columbia, S.C., Athens, Ga., Oxford, Miss., and any other town where football was a big deal and hotel accommodation was a little deal?
The questions of what to charge and what the market would allow for a maximum then fell into the discussion. College football fans, it turned out, were a relatively responsible and affluent lot. A thousand dollars a night for the whole house seemed reasonable, so reasonable, in fact, the second night could charge the same as the first night. No discount per night for two or three nights - every night was a thousand dollars or so.
After all, with a dozen overnight guests each night times two, a football home game weekend could average two thousand dollars, and that times four came to eight thousand dollars. Out of seven home games, four weekends seemed like a safe expectation in the home rent business.
The program was named Rent Like a Champion, and recently it scored serious financing through television’s Shark Tank and individually with Mark Cuban, billionaire owner of the Dallas Mavericks.
For me personally, I can claim fair-minded success. Beginning in the 2014 USC football season, I have collected for about three weekends each season, each weekend bringing in around two thousand dollars.
But football is not the only game in town. USC graduations, both spring and winter, are bringing three-night customers. That third night is good for another thousand dollars.
Then there’s USC baseball, weddings, funerals, local golf, and the Masters.
For me, the Masters hasn’t come in, but the Augusta crowd does too well not the share the fortune. Since a Masters visit is an all-day affair for several days, typically, the price per night might drop a little because there are nine nights altogether. We’ll see.
So far, now that football season is over, I can report about thirty thousand dollars gross take-home for the four seasons I have been engaged in the business. If you save the money over that same period, and I don’t, you can give yourself something of real value, or you can invest; either way, for just four years, you have actually accomplished something.
The downside is easily listed:
privacy is compromised
each occupancy requires spit and polish throughout the house
during the occupancy for a football weekend rental, the landlord has to hide
general wear and tear that comes with a dozen people for the weekend
The weekend guests always leave the house clean and orderly. They pay the rent in advance and they put a thousand dollars down as a deposit. Over four years, I have never needed to ask for any part of the deposit. Rent Like a Champion covers the insurance for the temporary rise in the house population. Rent Like a Champion does just about everything, including collecting and paying, even reporting to the IRS. Two days after the occupants’ departure, Rent Like a Champion authorizes the transfer of funds into your account.
On an entirely different income level, Airbnb is a somewhat reliable stream flowing every week. Figure on somewhere between five hundred dollars and maybe a thousand for every month. Looking beyond the money, however, is the quality of the tenants. I am always pleasantly surprised at who turns up.
There is a subset of single, accomplished, hard-working women looking nightly for safety accompanied by cheap rates. For the short time I have been working with Airbnb, I have seen plenty of quality people who probably are self-employed or if they are on payroll, they don’t get expenses fully reimbursed. In other words, just about every penny that goes out for housing is a penny gone. Not reimbursable. This crowd is looking for accommodations for less than a hundred dollars a night, but the safety feature might mean more than the price. When you stay at a motel for less than a hundred bucks, you’re surrounded by the kind of people who can’t afford to get above a hundred bucks.
On the other hand, when you approach a local homeowner for a single room for the night, you get somebody of standing in the community for an overnight landlord, somebody who stays in the house the whole time.
On New Year’s Eve, I have two Charlotte women who want to walk Five Points and stay at my place. Fine. Glad to have them.
Recently, I had a fourth-year medical student who needed two nights while he interviewed for a position in the residency program in emergency medicine.
A couple weeks ago, I had a model who came by around six just to see the place. She had already paid her nightly fare. She said she was happy with the accommodations, but she never came back. Then maybe a week later she sent me a gift package of cooking herbs, telling me she was sorry she never came back. Huh?
The Airbnb organization sees to it the city gets paid the hotel taxes for every room rented.
Over all, both Rent Like a Champion and Airbnb are good for the city. Money comes into town, and not just house rent but all kinds of hospitality cash gets thrown around town. I don’t think it’s a threat to the local hoteliers, but maybe they should take another look at their product. Business is business.
And homes are homes. These people come into local homes where the resident landlord has a lot of skin in the game, as do the surrounding neighborhoods and their city.
(Editor’s note: John Temple Ligon’s opinions are his own and do not necessarily represent those of Columbia Business Monthly.)