Successful Investor Reveals Three Key Questions for Airbnb Success

Nicole Shirvani, a full-time doctor and part-time real estate investor, has successfully expanded her portfolio to include short-term rentals. With her properties generating over six figures since January 2024, Shirvani offers valuable insights into what she considers before investing in short-term rental properties.

Shirvani’s portfolio consists of a mix of short-, mid-, and long-term rentals, including a triplex currently undergoing renovation for mid-term rentals. While short-term rentals can yield higher cash flow, they require more hands-on management. She noted, “There are guests coming in and out, so there are just so many different logistics.” In contrast, mid- and long-term rentals demand less ongoing involvement, but generally provide lower rental income.

The decision to venture into short-term rentals stemmed from a desire for diversification, tax benefits, and a personal interest in design. “There are some very legitimate tax benefits that you could take, and so I wanted to be able to take advantage of that,” she explained. The additional income from her vacation rentals has allowed her to bolster her savings for her daughter’s future.

Three Key Questions

Before committing to a short-term rental property, Shirvani evaluates three essential questions that guide her investment decisions.

1. What’s Nearby?

Shirvani prioritizes location, adhering to the real estate mantra of “location, location, location.” She assesses the appeal of nearby attractions, asking, “Is there a National Park that a lot of people love to go hiking in? Is it near major cities where you can get in the car, be at my place in two or three hours, and get out of the busy city for a quick weekend trip?”

Her two properties in the Shenandoah Valley exemplify this strategy, as they are less than three hours from Washington, D.C. One property is situated on a river, while the other is located in a ski resort area, making them ideal retreats for city dwellers.

2. Would I Enjoy Staying Here?

Shirvani also reflects on whether she would personally enjoy visiting the location. If a property does not appeal to her, she is likely to pass. “I thought of areas that I would also enjoy staying at, and what appeals to me,” she stated regarding her Virginia properties.

While investing out of state can seem daunting, Shirvani advises thorough research to alleviate concerns. “The more you familiarize yourself with the area, the more comfort you will feel,” she said, emphasizing the importance of understanding local dynamics.

3. What Are the Short-Term Rental Rules?

Understanding local regulations is crucial, as short-term rental rules can differ dramatically by location. Shirvani advises potential investors to ask, “Is the area open to short-term rentals? Are there any rules against them?”

To thrive on platforms like Airbnb, she insists on the necessity of market knowledge. “You definitely have to know your market,” she explained. “You want a place that’s beautifully designed, and you want to have a strong team on the ground in case there are any issues or concerns.” With short-term rentals, she believes that adopting a hospitality mindset is essential for success.

Through her experiences, Shirvani has demonstrated the potential of short-term rentals as a lucrative investment avenue. Her approach, characterized by careful consideration and strategic planning, serves as a guide for other investors looking to navigate the complexities of the short-term rental market.