Podcast Episode 26 – “How I’m Using Short Term Rentals to Achieve Financial Independence” with Dr. David Draghinas
Episode 26 – Financial independence (or FIRE, if you’re into retiring early) is the Holy Grail of personal finance. Achieving it takes work and a lot of time, and few people unlock secrets to getting there quickly. Dr. David Draghinas has managed to find an uncommon niche that will help you achieve financial independence. He joins us on The Scope of Practice Podcast today to tell us how to do it.
For years, he has been perfecting his technique for investing in short term rentals (like what you’d see on airbnb.com). Our conversation on the podcast today is all about how to develop those properties, market them effectively, and maximize your profitability.
It’s high-impact, high-yield, and we explore a unique niche in the world of personal finance. You’ll get a lot out of this conversation. If you’re ready to tackle a new challenge that can propel you towards financial independence, this episode is for you!
“Short term rental properties are a great way to become financially independent with just a few properties.”
– Dr. David Draghinas
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Meet Dr. David Draghinas (creator of Doctors Unbound)!
David Draghinas MD is a husband, father, physician, investor, and short term rental specialist.
Always passionate about real estate, David was seeking an asset class that would provide “high monthly cash flows” that would quickly propel him towards financial independence. He found such a wealth vehicle with short term rentals.
After cracking the code on short term rentals, he sought out a small group of physician investors to teach them his methods of investing. The refined teachings from this group have become David’s flagship course: Short Term Rentals to Financial Independence for Busy Professionals.
David gets so excited when he sees his students immerse themselves in the course material, then take action to create their own “short term rental” cash machines.
Take the course!
Dr. David Draghinas has been using short-term rental real estate investing for years to gain financial independence. He has taken that knowledge and experience and packaged it into a course that will show you how to do it too! The course will take you step by step through the process of buying a property, marketing it, maintaining it, renting it, and maximizing your profit from it. It’s an incredibly high-yield course, especially if you’ve never thought about becoming a real estate investor!
If you’re ready to become financially independent with just a few investment properties without the bother and hassle of being a long-term landlord, this is the course for you! If you register using my link, I’ll throw in a one hour financial coaching session for you FOR FREE! That’s a $200 bonus!
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This week’s featured blog post: 15 Valuable Tips for Investing in Short Term Rentals
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- 00:00 – Introduction to episode 26 of The Scope of Practice Podcast.
- 01:33 – Subscribe to the podcast, and please leave a review!
- 02:00 – Join the “Business and Personal Finance for Physicians and Dentists Facebook Group”
- 02:20 – Free disability insurance quotes from Pattern Financial.
- 03:35 – Introduction to Dr. David Draghinas
- 04:19 – Welcome to Dr. David Draghinas.
- 05:07 – Dr. Draghinas turned a hobby into a seriously viable business idea: short-term rental investments.
- 08:16 – Short-term rentals is not necessarily passive income. It’s more of an active investment. It actually requires quite a bit of work up front until it becomes more passive down the line.
- 09:55 – Short-term rentals don’t have to be related to vacation homes. You can make a lot of money renting a home to someone in your community for a short period of time. You can cater to people who want a “staycation,” or who need a place to stay for coming into town for a medical procedure, or while they’re renovating their house.
- 11:52 – Catering to people who are coming to stay in town to be close to someone who is in a hospital is incredibly marketable.
- 13:19 – When assessing a market where you want to buy a property, you can buy a property in your local market or a more distant town. You need to assess the local, city, county, and HOA regulations to make sure it’s a viable market. Tools like airdna.co can give you a lot of information.
- 15:28 – You can start looking at sites like Zillow and Redfin to find properties that are available, then go to airdna.co to come up with data on how much rental income you can expect, how often properties are rented, etc.
- 16:28 – Buying the “right property” at a great deal takes some experience. Spend time doing research. You need house that is going to photograph well. They need to look fantastic, and you need to get a high quality professional photographer.
- 18:27 – When you choose a property, consider who your competition will be. When you buy a low-cost property, you’re competing with every hotel in the area. If you’re buying a luxury property, you’re competing for higher-end clientele.
- 20:18 – Select high-quality tenants. Consider setting a higher minimum age (28-30 years old) to select for more mature clients. Consider setting a three night minimum. State in the rules that you don’t allow parties or events. Add a fee for cleaning or for excessive guests. Install cameras on the outside of the property to keep an eye on how many people are coming and going.
- 23:09 – The regulations for short-term renters and long-term renters are different. Short-term renters don’t have tenants rights unless they have a longer stay (28-30 days).
- 24:03 – You can convert a short-term rental into a long-term rental if you want.
- 25:11 – Short-term rentals can be highly lucrative. You can make $1,000-$2,000 per month for a basic property. Luxury properties can make closer to $3,000-$5,000 per month. So, you could basically be financially independent with 3-4 properties.
- 26:16 – Advertising? Start with AirBNB and VRBO. Do both initially, because you can get bookings in both places. booking.com is another site that is starting to show more vacation rentals as well. You can also do direct booking with creating your own website for it. You could do direct bookings by working with hospitals, wedding venues, and event planners.
- 28:32 – Return clientele can be a great way to get bookings. You can contact previous clients and send them the schedule for a local sports team or other major events.
- 30:09 – Most luxury properties are too expensive to be able to pay for in cash. A typical investment property needs a 20-25% down payment.
- 31:02 – There are significant tax advantages to owning rental properties. For long-term rentals, you can get professional realtor status unless you work at the real estate >51% of your time for a minimum of 750 hours per year. But, for short-term rentals, you can deduct all of your expenses which can help lower your tax liability. Check with your tax professional to be sure you’re staying within the legal standards.
- 33:36 – Typical expenses for the property include: short-term rental insurance, principal/interest, taxes, cleaning service, utilities, entertainment package for TV (not necessary cable TV), furnishing the property up front, and consumables like toilet paper and toiletries.
- 36:16 – Make sure you have a rental agreement that covers you in terms of limiting liability in case someone gets injured on your property. Also, get umbrella insurance coverage. Additionally, set up an LLC or some other way to create a limited liability situation so you’re not exposed to a lot of liability.
- 38:14 – Hiring a property management company can be helpful, but it really cuts into your bottom line. It’s some work up front to deal with urgent problems like HVAC or plumbing issues, but once you have a team in place, it’s easy enough to dispatch people quickly.
- 41:41 – Dr. David Draghinas has a course on how to do short-term rentals. Check it out!
- 43:43 – Introducing the Doctor Podcast Network!
- 47:30 – Connect to Dr. David Draghinas and Doctors Unbound!
- 48:57- Summary of the episode.
- 49:15 – Sign up for Dr. Draghinas’ online course for how to start and grow a short-term rental business to achieve financial independence.
- 50:44 – This week’s free resource: The Scope of Practice Reading List
- 51:39 – signing off
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