Latest / Thanks For Visiting / 245. Investing Abroad: A Guide to International Short-Term Rental Properties

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245. Investing Abroad: A Guide to International Short-Term Rental Properties · Thanks For Visiting

0:00
Sarah: Welcome back for another great episode.
0:02
My name is Sarah Karakaian.
0:03
Annette: I am Annette Grant, and together we are--
0:05
Both Annette & Sarah: Thanks for Visiting.
0:07
Sarah: We've got an exciting episode for you today.
0:09
But before we travel abroad, hint, hint, we're going to kick off this episode like
0:13
we do every week, and that is sharing one of you, our loyal listeners who's
0:17
using our hashtag #STRShareSunday, which I just learned has over 20,000 tags.
0:23
Annette: Sarah, be honest.
0:24
Remember when we first started?
0:26
Sarah told me the story a long time after we got started, but
0:29
we had no followers on Instagram.
0:31
No one was using our hashtag and she said one night she was laying
0:34
in bed, wait, tell-- it's so funny.
0:37
She was like, forget it, this is never going to work.
0:40
We had two people that use STR Share and it was me and her.
0:43
And we had two podcast listeners, her mom and my mom.
0:47
She literally was going to throw in the towel.
0:50
Sarah: Oh, I don't forget it.
0:51
And I was also sleeping on a mattress, one of our flips has
0:53
taken us five years to finish.
0:55
Annette: What we're saying here is we are completely blown away.
0:57
Thank you.
0:58
Every hashtag matters.
1:00
Every podcast download matters.
1:02
Every review really matters.
1:04
But we're going to share one of you today that has used our hashtag, and
1:10
today we are sharing @meetme_atmango.
1:16
Again, that's @meetme_atmango.
1:18
Be in the show notes.
1:20
And this was so much fun going through Shoshana's feed.
1:24
Her feed is just as bright and colorful as her property.
1:28
She is in Fort Lauderdale.
1:29
Please check her out.
1:31
She put in a hot pink Christmas tree.
1:34
But everything here, I can tell she poured her heart and soul into this property.
1:39
And one thing that really sticks out that I want to let you know is
1:43
she has a lot of beds, but she's done it in a really tasteful way.
1:47
Two twin beds.
1:48
Two full beds.
1:50
She hasn't done the bunk bed route.
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If you know that you need to sleep a lot of people, and some of us are
1:55
like that, you need to have these properties that you can compare.
1:59
She's in Fort Lauderdale.
2:00
A lot of people are going there with a lot of people to travel.
2:02
And so I just appreciate that instead of all the bunk beds, she was like, I'm
2:06
still going to get the headcount that I need to make the numbers work, but I'm
2:10
going to do it in a different direction.
2:12
And I think that's just a really great way to do it.
2:15
Another thing is something that Shoshana has done that I haven't seen as much
2:19
with hosts is she has the shoppable button inside her Instagram feed.
2:24
And when you see that, it's like a little shopping bag.
2:26
And I think she has affiliates accounts here.
2:29
For instance, she has an outdoor shower, and that links to Florin Decor.
2:33
It's the same tile that she has used.
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And so if you double tap on it, she has links out to all the things
2:41
that she's designed her home with.
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So I'm hoping she's getting affiliate commissions from this.
2:48
But well done.
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Please check out her reels.
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Check out her design.
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And I just appreciate what she's done here.
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And she has, um, some influencers that have stayed at her place and
2:57
she's pinned their TikTok and reels.
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So well done.
3:01
Check her out.
3:02
And I absolutely love her logo and the name.
3:04
It's after the three mango trees in her front yard.
3:08
But, Sarah, let's get to the episode.
3:11
Sarah: Well, per usual, we have an episode that is completely selfish, but we're
3:16
hoping all of you can benefit from it too.
3:18
Annette and I have toyed with the idea of, we want to buy something soon here.
3:23
We were like, we got money.
3:24
We want to-- it's burning off--
3:25
Annette: By the water.
3:26
Sarah: Yeah, by the water.
3:27
And it's burning a hole in our pocket.
3:29
We thought about Mexico and we dream, and it's like, but what don't
3:33
we know about buying in a country that we didn't grow up in, that we
3:37
know nothing about that culture?
3:40
So we thought we would bring in one of our Hosting Business Mastery Members.
3:44
We've got Julie here who's going to tell her incredible journey of getting from
3:49
backpacking in Australia to owning in Costa Rica while calling Canada home.
3:55
So with that, Julie, welcome to the show.
3:59
Julie: Thank you.
4:00
So yeah, my husband and I met backpacking many, many years ago.
4:04
We've actually been married for 20, almost 22 years.
4:09
So we met quite a few years ago in Australia, backpacking.
4:12
And it's funny, I had to go-- he's Canadian as well, and so
4:15
I had to go halfway around the world to find another Canadian.
4:18
Annette: That's how it works, right?
4:19
Julie: How it works, right?
4:21
And we weren't even living in the same parts of the country at the time.
4:24
This was just at the early stages of email and the internet, so we were penpaling and
4:30
writing love letters back and forth, and Sunday evening phone calls and all that.
4:34
And I eventually decided to move to Vancouver from Montreal to be
4:37
with him and to see where it goes.
4:39
Well, our relationship started and Australia planted a seed, and we
4:44
decided to go back to Australia and work there for a few years.
4:48
He was in the IT industry.
4:49
There was a lot of demand for his skills, and we thought that
4:53
could be a fun adventure for us.
4:55
One of the things we both loved was travel.
4:56
So we were in Sydney, Australia for four years.
5:00
During that time, we were talking about what the future would look like.
5:03
And short-term rentals weren't really a thing then, bed and
5:07
breakfast were more of a thing.
5:09
And even on our honeymoon we would discuss ideas of what we could do.
5:13
And we've always liked hosting people and you have friends come
5:16
stay with us, and wouldn't it be fun if we could do that as a business?
5:21
But it was always this crazy far out idea.
5:25
So then we moved back to Vancouver after spending four years in
5:28
Australia and life starts happening.
5:32
We bought a house.
5:33
We got a dog.
5:35
We started our family with our daughter, and that dream just got shelfed.
5:40
And so did the dream of going back overseas.
5:44
We had thought we would just go back to Vancouver for a few years, but
5:47
then a few years turned into 16.
5:50
Always with this discussion in the background.
5:52
So from there, it was this fireside chat we always had like, oh, wouldn't
5:59
it be nice if we'd go somewhere, and what's holding us back?
6:02
And we started with, we should just downsize.
6:06
We should just sell everything.
6:07
We should sell the house.
6:09
A little sidebar on that, we already had some long-term
6:12
rental investments at that point.
6:14
Annette: I was going to ask you, in this suburban time that you and
6:17
your husband, uh, were doing your suburban life, were you starting
6:20
to invest in real estate though?
6:22
Julie: Yeah, we were.
6:23
My husband found the long-term real estate space and that just ignited him.
6:28
That just lit him up.
6:29
So that was happening.
6:30
But short-term was still this weird unknown idea that we
6:33
couldn't, I mean, we didn't want to have it done in our own house.
6:37
So we wanted to go back overseas and live somewhere.
6:41
And started looking at what potential places we could live.
6:45
And Costa Rica came on our horizon.
6:48
So we decided that the first thing we had to do was sell our house, sell our
6:51
belongings, and start putting ourselves-- getting our ducks in a row to move.
6:54
Annette: Okay.
6:55
Whoa, whoa, whoa.
6:56
I have ideas.
6:57
Trust me, I got lot of ideas, but it's not get my ducks in a
7:01
row and move to another country.
7:04
I want to know.
7:05
How does the discussion start?
7:07
Is it, hey, there's a little fire inside, we want to go back overseas?
7:11
Do you start going on Zillow?
7:13
Did you take a family vacation and it really sparked it?
7:16
Because what you're saying to me is mind blowing, ducks in a row, long-term
7:24
property, short-term, downsize our family.
7:25
These are giant life decisions.
7:28
And was it you more than your husband?
7:31
Yeah.
7:31
What was really the key thing that lit the fire, the fire starter, if you will?
7:36
Julie: I like to do a lot of research.
7:38
When I get an idea in my head, I need to do a deep dive into it.
7:42
Whether I read all the books or I find all the websites, whatever it is.
7:47
Just the idea of moving to Costa Rica, we talked about it often in our little
7:50
fireside chats, what would it look like?
7:53
We're like, well, we're not going to move somewhere cold.
7:55
Annette: Okay, see, this is what I wanted.
7:57
You start really using your imagination.
8:00
Okay.
8:00
Julie: Yeah.
8:00
So moving somewhere cold, that's not going to be an option.
8:02
So that took Europe and other countries out of the mix.
8:07
With aging parents, we didn't want to be halfway around the world again.
8:10
So appealing as a place like Thailand or other destinations like that would
8:15
be really cool, it's just too far time zone-wise, trying to coordinate family
8:20
discussions when you have aging parents.
8:22
Annette: Mm-hmm.
8:23
Julie: We had to also consider schools because we were bringing
8:25
a teenager for the ride with us.
8:28
We had to consider where there was going to be some good
8:29
international schools for her.
8:31
So as I did all my research and would have these evenings of just diving
8:35
deep on the internet, Costa Rica we kept coming up and kept coming up.
8:39
And so we planned our first trip, just Mark and I, coming
8:42
down here four years ago.
8:44
And just exploring some-- we only had a couple weeks.
8:48
That was all that we could get away for, so we decided to just focus on,
8:51
as it turns out, the area that we live in now because it called to us.
8:55
All the research I was doing felt this pull.
8:58
And we came down and we fell in love with it.
9:00
But honestly, at the time, I was a suburban mom.
9:04
Moving from that and all my comforts to rural jungle Costa Rica, I was
9:10
like, okay, yeah, this is really nice.
9:11
It's fun to be on vacation.
9:13
We're not doing this.
9:14
I can't see myself here.
9:17
And then we planned a family holiday a year later just before the pandemic and
9:24
explored different parts of the country.
9:26
I don't know, I guess we still felt the pull to Costa Rica and perhaps
9:28
there was just this little-- I thought maybe for somewhere a little more
9:31
touristy that would be more appealing.
9:34
And it was funny, it had the opposite effect.
9:36
Once we had a taste of a more developed touristy Costa Rica, we're
9:42
like, this is not it for us, at all.
9:44
We really want to go back to where we initially thought we didn't belong, which
9:48
is more rural and more lush and more green, and that's what's going to happen.
9:52
So we made a plan for June, 2020 once the school year ended
9:57
that we would make that happen.
10:00
And meanwhile, we sold our house.
10:02
We sold most of our things.
10:04
Annette: Is your daughter kicking and screaming?
10:07
Julie: Oh yeah.
10:07
Annette: If I'm a teenage girl, I'm pissed.
10:09
What are you doing?
10:12
Let's talk about that.
10:14
That's a real-- let's talk about teenagers.
10:17
I have never had a teenager, but I can only imagine.
10:19
Sarah: But I've been one.
10:20
Annette: Right.
10:20
A female teenager, not that females and males any are worse, but it
10:24
sounds like she's the only child.
10:26
I'm just like, I can't imagine.
10:27
Let's talk about that.
10:28
Is it like, this is done, this is the decision, or is she part of this?
10:32
How do you involve her in this conversation?
10:37
Julie: So she was part of the conversation, but not with an option
10:41
of opting out, if that makes any sense.
10:44
So it was, we want to do this, what can we do to make it as
10:48
comfortable for you as possible?
10:52
And the agreement that we actually came to is that we
10:54
would fly her back to Vancouver.
10:56
She's been traveling on her own since she was eight years old.
10:58
We're a family that travels a lot.
10:59
So she's been flying to grandma and grandpa on the other side of the--
11:02
in Montreal since she was eight.
11:04
And she's now been flying internationally on her own since she was, I think it's 14.
11:10
Yeah.
11:11
In fact, she's actually there right now, uh, because it's the
11:14
Easter break here right now.
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So I've got the house to myself.
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So that was the compromise we came to, is that she would get to visit her
11:20
friends at least once or twice a year.
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And that we would do everything that we could within our
11:24
means to make that happen.
11:26
Sarah: Do a little shadowing.
11:27
Did she end up liking the move or is she still kicking and screaming?
11:31
Julie: She has come a long way.
11:34
Bear in mind the timing of when we did all this.
11:36
We had planned to do this in 2020.
11:39
School is online, you're not really seeing your friends much.
11:42
And then we move here and a lot of the same things.
11:45
School was online here.
11:47
They were only in class maybe once or twice a week, depending on the peaks and
11:52
the highs and lows of what was going on.
11:55
Really, really tough time to be the new kid in school.
11:58
And also going from a school where there's perhaps 30 children
12:03
in a classroom, there's now 30 children in the entire high school.
12:06
She's in a classroom of six.
12:09
So a very large change, very hard to be that new kid in that environment.
12:13
So that first year was pretty tough and it was tough on everyone in various ways.
12:19
But yeah, to try and meet other families.
12:22
Nobody else is moving here with teens, so trying to find other people
12:27
in our same position was difficult.
12:29
Annette: Both of these original trips, the first one that you took with your husband
12:32
and then the second one that you took as a family, were you meeting with realtors?
12:36
Is it like, yeah, you're there traveling, but obviously, are
12:41
you meeting with realtors?
12:42
Are you going to banks?
12:42
What type of-- I know you said you're a researcher.
12:44
Are you that dialed in like you already had houses to look
12:47
at, you already had areas?
12:48
What did those trips look like?
12:51
Julie: So all the research I was looking at was pointing to not
12:54
rushing into things, um, that whole fools rush in mentality.
12:58
So we did after that second trip, the one that we took as a family and
13:02
went to the more touristy Northern Guanacaste area, is my husband
13:06
within two weeks was back down here.
13:09
He's like, okay, I'm going back.
13:10
I'm going to start looking at lots.
13:12
And that's when he-- yeah.
13:15
Annette: In two weeks, okay.
13:16
Sarah: Let's go.
13:17
Julie: Oh, yeah.
13:17
We were home for two weeks and he was like, okay, I'm going back.
13:19
Annette: Oh, wow.
13:20
Julie: So he in a week had a different realtor lined up for every single day
13:25
with all our things that we're looking at.
13:27
Now, bear in mind the background you're seeing, this is actually
13:29
a rental house that we're in.
13:30
We have been renting for two-and a-bit years.
13:34
Because of that whole fools rush in thing, we did purchase land
13:38
on that, I guess would've been his third trip to Costa Rica.
13:42
But we've been taking our time, learning as much as we can
13:46
about how to build down here.
13:48
And that's even a whole other podcast.
13:51
So all the research that I was looking into was pointing into just taking
13:54
it slow because things are different and you learn a lot about yourself.
14:00
You learn a lot about your needs, um, when you're renting.
14:03
Annette: What is the property difference financially?
14:06
You're Canadian, and I'm not as familiar financially there.
14:10
When you were looking in comparison to your homes in Canada, what's
14:15
the financial exchange there?
14:17
Are you going to be able to buy a lot more in Costa Rica?
14:20
Can you talk about some of the financial differences there?
14:23
And then also once you answer that question, what do the mortgages look like?
14:27
What's the difference, um, when you're purchasing in Costa Rica?
14:30
Julie: Okay.
14:30
So I'm going to actually answer your second question first.
14:34
It is extremely difficult for a foreigner to get a mortgage down here.
14:38
Not impossible but there's a lot of hoops you'd have to jump through.
14:41
So it's a cash only deal.
14:43
So right away that sets your budget.
14:45
Whether you're buying land and then building on it, it's all cash.
14:49
No builder is going to finance you.
14:52
None of that.
14:52
So you need to be very dialed in with your numbers and what you can
14:55
afford, and also be prepared that you're going to go over budget.
14:57
Annette: Okay.
14:57
What was the dollar exchange though Canadian to Costa Rican?
15:02
Is your dollar worth more in Canada than in Costa Rica?
15:06
Julie: So here's where it gets fun.
15:08
We tend to think more in terms of US dollar to Costa Rican dollar, and
15:11
right now it's about 530 Colon to one US dollar, which is not great.
15:20
We live off the income from our long-term rentals, which are actually in the US.
15:25
Annette: Julie, now you just threw another wrench in whole--
15:27
Sarah: You are a layered human being.
15:29
Julie: Oh, there's a lot of layers.
15:32
Part of leaving Canada, for us, was to-- Canada's a little different
15:35
than the US in that we can get non-residency status for tax purposes.
15:40
So we have not given up our citizenship, but because we've sold all our
15:43
belongings and fulfilled all the criteria, we are no longer resident.
15:47
So we no longer earn money in Canada.
15:49
Annette: Ah.
15:51
Interesting.
15:52
Okay.
15:52
Julie: Otherwise, we'd be paying tax double.
15:56
So something to keep in mind.
15:58
Yeah, that's a whole other thing.
16:00
So we had to skirt that.
16:02
And because we had sold our house, the initial proceeds for doing all
16:06
the short-term rental investing was the proceeds of our house sale.
16:11
So cash deals.
16:14
Annette: Okay.
16:15
So talk to us and our listeners about that.
16:17
So you sold the primary residence in Canada, the proceeds from that home sale.
16:23
What have you purchased short-term rental-wise from that particular sale?
16:27
Julie: So from that we've purchased three short term rentals.
16:30
So the Vancouver housing market, uh, is extremely expensive and so at the
16:36
time, in a pre-pandemic world, prices were more reasonable Right now, um,
16:41
things have since gone up quite a bit.
16:42
And so there's also some interesting thoughts on selling some of the
16:46
properties that we've purchased.
16:47
But from the sale of the family home, we were able to purchase three apartments.
16:51
Annette: Okay.
16:52
Julie: The ones in Mexico were all pre-construction projects.
16:55
So one we took possession of.
16:57
The one in Akumal, we took possession of July, 2020, and the one in Puerto
17:04
Vallarta is not going to be available until September, 2024, uh, although
17:10
that could get pushed into 2025 if it goes the same way as the Akumal one did.
17:15
Things happen on their own timeline internationally.
17:19
Annette: That is one thing.
17:21
We have had a few other guests on the show and then obviously
17:24
conversations, and the construction timelines, number one, was something
17:29
that became very apparent to them.
17:32
And also just timelines for any laborer, whether it's someone helping you with
17:39
turnovers, a plumber, an electrician.
17:42
You got to really comfortable with timelines being extended normally.
17:48
Julie: And a lot of that has to do with the culture.
17:50
Um, especially when we come from a North American very efficiency-focused
17:54
mentality where we tend to prioritize work above everything else, in
17:59
Central America, family is everything.
18:01
And so your tradesperson or whatever person you're working
18:06
with, might not show up.
18:07
They might show up later.
18:08
They might not show up at all until the next day.
18:10
And it's not because of laziness, it's not because of a want of work.
18:14
It's like their mom needed them that morning.
18:16
And so that's the priority.
18:18
Mom needed me, or my family needed me in some way, or an uncle passed away
18:22
and now we're all going to the funeral.
18:25
Those are the things that as a foreigner, you just need to learn to adjust too,
18:29
because family comes before everything.
18:32
And in some people it's even religion comes above that.
18:35
But for the most part, family is first.
18:38
Annette: Interesting.
18:39
I mean, not interesting.
18:40
It should be how things are, but we have some things server us--
18:43
Julie: Yeah.
18:43
But from a North American mentality, that we're focused on timelines, it's
18:48
a very different way of thinking.
18:49
Annette: Absolutely.
18:50
Sarah: So right now, do you have any short-term rentals in operation?
18:55
Julie: Yes, we have the one in Costa Rica, and the one in Akumal, Mexico.
19:01
That's a little sidebar about the one in Mexico.
19:03
We actually ended up-- we thought we were going to manage that one ourselves
19:06
a lot more than we actually are.
19:07
The reality of just life and budget and things is that we're not able to
19:13
be there as often as we had initially planned when we purchased it.
19:17
And so we've decided to go the property management route.
19:19
And so we're a lot more hands off on that one except for the initial setup.
19:23
And that's where all those HBMM lessons came in.
19:25
And our property manager was very impressed with how detailed we were with
19:30
the setting it up and making it just so.
19:32
But as far as the rest of it goes, it's a lot more hands off for us.
19:36
The one that is in Costa Rica right now, um, that we purchased
19:40
about a year and a half ago, that one is full hands on for me.
19:44
Annette: If you can share with us financially, how's it going for you?
19:47
How's the property in Mexico going?
19:49
How's the property in Costa Rica going?
19:51
Let's start with the property in Mexico first, because you have a property
19:54
manager and it sounded like you did your financials with you managing it.
19:59
Talk us through those financials and how it's varying for you and your family.
20:04
Julie: So the property in Mexico, the one in Akumal, it's doing reasonably well.
20:09
It's weird when somebody else has their hands all over it because I feel
20:13
like I don't have as much control.
20:15
I'm not doing the marketing, I'm not doing all the things that I
20:18
like to do to boost it up on the first page and all those things.
20:22
So in that respect, it's not doing as well as I would like it to do,
20:26
but it's still doing reasonably well.
20:28
Annette: Okay.
20:29
Julie: The one in Costa Rica is doing exceptionally well.
20:32
So we're just coming out of high season and it's been pretty much
20:36
solidly booked all through high season.
20:38
I've only had a few gaps here and there with it not having guests.
20:41
And that's actually been a good thing because it's allowed us to take care
20:43
of a little bit of maintenance, um, in between guests at this time of year.
20:47
Annette: Talk to us about the traveler.
20:49
Who is the traveler coming to Costa Rica?
20:50
Is it a lot of US citizens, Canadian citizens?
20:53
What are you seeing coming through your doors in Costa Rica as far as the clients?
20:58
Julie: When we first launched, funny enough, a lot of our clientele was-- so
21:01
we launched a little over a year ago.
21:03
A lot of our clientele were Costa Ricans because of the timing of it.
21:06
We launched near the tail end of the high season, so a lot of the people
21:11
that would've been planning ahead like the US market that would've been
21:14
planning ahead, we weren't launched yet for them to plan ahead to come down.
21:19
So it was mostly Costa Ricans who were looking to get away for
21:23
the weekend down at the beach.
21:25
So San Jose is about a 90 minute drive away.
21:28
They can come down, have a nice weekend at the beach, and then go back
21:31
to city life and their day to day.
21:34
So very surprising, um, that those were our first initial guests or North
21:40
Americans who were already in Costa Rica, either living or traveling and being a
21:45
lot more flexible with their travel plans.
21:48
And that carried us through the tail end of high season and most
21:53
of the low season last year.
21:55
And then that gave me the fire to achieve super host by the time would
22:01
start booking their high season trips and then I would be on top for that.
22:08
And then we were solidly booked pretty much from December through till now.
22:12
Annette: Love it.
22:13
What's this doing for you now?
22:15
This property, you had to pay in full for it, correct?
22:17
Julie: Yeah.
22:17
Annette: So is there-- how is that balance?
22:20
I'm making some assumptions here, but I'm assuming a lot of our listeners probably
22:23
have some mortgage out on their short-term rental and maybe their primary residence.
22:28
Is this cash flow right now for you and your husband to live?
22:30
Are you guys still working?
22:32
What is the plan with the income now from your two properties that you're
22:36
currently hosting plus the next?
22:38
Is that what you're living off of right now?
22:39
Are you still working?
22:40
Is your husband working?
22:41
Julie: No, we're living mostly exclusively off of our combination
22:45
of our long-term rental income and the short-term rental income.
22:49
We live very modestly, so I think something to keep in mind as far as
22:53
central American living, Costa Rica is not a cheap country to live in.
22:55
And it's gotten more expensive in the two-and a-bit years
22:58
since we've moved down here.
23:00
So although we were able to do very well, um, by bringing up the level of
23:05
service that we were providing, um, as a host, and the apartment, the one in
23:12
Costa Rica, what it used to rent for in a month, on a monthly basis we're
23:15
now getting in a week in high season.
23:17
Annette: All right, let's slow that down.
23:19
Julie: Yeah.
23:21
Annette: Can you give us numbers in USD; would you mind doing that?
23:24
Julie: No, um, we rented for a $1,000 a week.
23:27
Annette: Okay.
23:27
And so--
23:28
Julie: And the previous owner used to get that a month, but with doing
23:31
very little for the guests and not really providing great service.
23:33
Sarah: So get specific there.
23:35
I mean, to us, Hosting Business Members, it probably seems obvious of the changes
23:40
you made, but just for fun, what are the exact changes you made that you think made
23:45
the biggest impact on that revenue change?
23:50
Julie: Okay.
23:50
So for starters, there were some cosmetic changes that we
23:53
had to make to the apartment.
23:54
And because we wanted to get it up and online quick, we had to look
23:57
at our to-do list and prioritize.
23:59
The obvious one at the time was furniture.
24:01
What was in there was quite ugly.
24:03
And so we prioritized the bedroom furniture, had something really nice made.
24:09
Invested in some nice hotel quality bedding, and just really
24:15
made that much more appealing.
24:16
Annette: Was it a short-term rental before too?
24:19
Julie: It was.
24:20
Annette: Oh, so we're not even talking long-term rental.
24:22
With this a short-term rental, you have four acts with--
24:26
Julie: Yeah.
24:27
It was an underperforming short-term rental.
24:28
Annette: So good.
24:29
Keep it going.
24:31
Julie: The really appealing thing for us is, well, first of all, it's on the beach.
24:35
It has a private rooftop deck, and it didn't have a cover on
24:39
it the way the neighbors do.
24:40
So it was wide open to the sun, which nobody was spending any time up there.
24:44
None of the guests were spending time.
24:45
So that was another priority of ours is, let's get that baby covered up and create
24:51
a really nice outdoor space up there.
24:53
So we put a hammock.
24:54
We put a really nice seating area.
24:55
We brought a barbecue in.
24:57
All these little touches just to make it much more welcoming,
25:02
and not just a crash place.
25:03
And same thing in the living room.
25:05
The living room and the kitchen, we didn't do too much except
25:07
that we threw out a ton of crap.
25:09
There was just a lot of clutter and junk that wasn't adding
25:15
anything at all to this space.
25:17
And instead we just gave it a nice little clean slate and, uh, put the
25:22
things in the kitchen that really should be there, like a good coffee
25:25
maker, some nice dishes, a toaster that didn't look like it was bought in 1980.
25:31
It was just all these little things.
25:34
And that got us going.
25:36
And we started getting some guests booked in.
25:38
And then as the money started coming in, we could then prioritize other purchases.
25:42
A few things were some surprises that we were, for example, planning
25:45
to replace the sofa, but then the washing machine crapped out and we
25:49
had to replace the washer dryer.
25:52
So sofa budget went to that.
25:54
And of course, like I said, everything here, you purchase
25:58
things on cash and so, um--
26:01
Annette: Got you.
26:02
Julie: You need to be prepared for that.
26:04
That was a little bit of a financial surprise.
26:06
And then, yeah, as the money comes in, we don't personally
26:11
live off a lot of the income that comes from the short-term rental.
26:14
It provides the little extras.
26:15
We mostly live off the long-term rental income at this point, because
26:19
a lot of money had to be spent in that first year just bringing the place up.
26:23
Annette: Mm-hmm.
26:24
Julie: Once we started getting it looking really good and taking really
26:27
nice pictures and getting some good reviews, that really helped us be on
26:33
page one and get more and more bookings.
26:35
And then we could slowly raise the prices.
26:38
Annette: And your property that's under construction, did you have
26:41
to pay in full for that also?
26:43
Julie: No, we have a special arrangement on that one.
26:46
That one does have a mortgage on it.
26:50
That's a whole other--
26:51
Annette: You used the word special arrangement, so we were just
26:54
like, we'll leave that there.
26:56
Julie: No, sorry.
26:57
No, I don't want to take it-- it could become a long conversation.
26:59
Annette: No, but I appreciate that.
26:59
Julie: My husband's very involved in these real estate investment groups
27:02
and they do these bulk purchases where somebody in the group guarantees a
27:10
special price by having 25 investors that are going to buy into thesame project.
27:15
Annette: AD MARKER
27:16
I want to talk about, strictly, are you getting all of your
27:19
bookings from Airbnb right now?
27:22
Julie: Mostly.
27:23
So that is our main funnel.
27:25
We're also on Vrbo, and we're also on Booking.
27:28
And I've had a few bookings coming in that way.
27:30
Those are not as easy to work with, especially in this market because they're
27:34
not set up exactly for what we are offering, but I look at it as those are
27:38
bookings I would not have had otherwise.
27:40
Annette: Absolutely.
27:40
Julie: And so--
27:41
Sarah: Yeah.
27:42
Since why not.
27:42
Julie: It's worth the pain factor of working with those organizations.
27:46
But yeah, I would say 90% of our bookings come in from Airbnb and some
27:53
of those have been repeats as well.
27:54
Annette: Oh, love that.
27:56
Julie: Yeah, so of course, you always mention, book with us again
28:00
and contact us directly next time and we'll give you a better deal.
28:04
And we've had people take us up on that.
28:06
Annette: Love that.
28:07
Sarah: Property in Costa Rica and property New Mexico, is your
28:10
mindset long-term wealth or is it getting to be your own boss?
28:16
Do we think about Costa Rica real estate the same as we would think
28:19
about it with the US real estate in terms of it appreciating?
28:23
Julie: We're always looking at what the appreciation is.
28:25
Um, we've actually got the Alkumal property up for sale right now just
28:29
to see if we'd get any bites if it's worth just because it's appreciated.
28:33
And we thought, well, in the long-term, are we going to do better by taking
28:39
advantage of that appreciation and then being able to take that money
28:42
and do something else with it?
28:43
Or are we better off hanging onto it?
28:46
Right now it looks like it's a better move to sell it.
28:51
My buzzword with my husband, um, is always, what's the exit strategy?
28:54
So any ideas that we always have about real estate is always, what could we
29:01
do next, and what does the future hold?
29:03
And so sometimes that means hanging onto things, and sometimes
29:06
that means letting go of things.
29:08
And right now, because we live full-time in Costa Rica, we're wanting to
29:12
focus more of our efforts down here.
29:14
And because it's a lot more challenging to get to and from Mexico from here
29:18
than we initially had planned, we're not looking long-term to be in Mexico.
29:23
But with a daughter who is soon going to graduate high school and leave the
29:26
nest, we are looking at what other markets might we want to get into and
29:30
other places we might want to travel to.
29:32
So it's an ongoing conversation that we're always having.
29:36
Annette: I used to get furious.
29:38
I'm going to be vulnerable.
29:40
I used to get furious when I would talk to businesses and the first thing they
29:43
would talk about is their exit strategy.
29:45
And I would just think it was the most not motivating for team members, and like,
29:52
is that the only thing you're worried about is getting rid of your business?
29:54
Do you even care about your business right now if you're only
29:57
concerned about the exit strategy?
29:59
And I can confess that I've completely changed my mindset about that to,
30:04
why are you doing anything if you don't know what the exit strategy is?
30:09
So I love that you said that because I think you do have to start with the end
30:14
in mind, or you don't have a direction.
30:16
You don't have a path, or it'll really help you change the path that you're on.
30:22
And I do want everybody to listen to what you said, your buzz statement with your
30:27
husband is, is what's the exit strategy?
30:29
Because I think a lot of people are like, a, what's the worst-case scenario?
30:32
What's the best-case scenario?
30:34
But truly it is, what is the exit strategy here on whatever it may be?
30:38
Is it buying the property?
30:40
Is it starting the business?
30:41
Because I think it forces you to fast forward and get really, really focused
30:46
on why you're doing what you're doing.
30:48
And then if you waffle and you're like, oh my gosh, a, there is no strategy,
30:51
and b, there is no exit strategy, then we need to probably rethink all of it.
30:54
So that has been a huge mindset shift for me from not wanting to talk about it at
31:01
all, or thinking that was like the cap out thing for people or the easy way out.
31:04
I'm like, no, that's the most strategic way, I think, to look at things instead of
31:08
worst case, best case, the here and now.
31:10
It's like, really what is that exit strategy there?
31:12
So I love that.
31:13
Have you and your husband always talked like that about the exit strategy or when
31:17
did that conversation start to come up?
31:19
Julie: I think it's mostly been in the past three years.
31:21
I mean, the world is changing and changing very quickly and we've all had to learn
31:26
to pivot a lot more quickly than we had.
31:28
And honestly, the day we sold the house, it was like an albatross
31:34
had been cut loose off my neck.
31:36
And it suddenly gave us that comfort of not just getting stuck and
31:42
doing the same thing all the time.
31:44
Sarah: What a good a good way at, Julie.
31:46
I mean, very few people think of it that way.
31:48
You think of home as your base, as the most safe place ever.
31:54
And I appreciate your point of view of it being this thing that you could let go to
31:58
free you up to really follow your heart.
32:02
And I also appreciate that you lived in that home for a very long
32:05
time and represented a certain chapter or chapters in your life.
32:09
And so you're ready to turn the page.
32:10
And we all have different stories we're telling, but I do love that perspective.
32:16
Julie: In the end, it's just stuff, right?
32:18
Sarah: Mm-hmm.
32:19
Julie: At least for us.
32:19
To us, home is where we are together as a family.
32:24
It's not necessarily a place that has been in the family for many years, or a
32:28
place that has all these heirlooms in it.
32:30
It's wherever we are together as a family is home to us.
32:33
Annette: A couple of things because I know our listeners are going to want to know.
32:36
A, what did your neighbors, your family and friends, did you get flack?
32:39
Were they like, you are completely nuts?
32:41
What are you doing?
32:43
Talk to us about the backlash if there was from--
32:45
Sarah: The backlash.
32:46
No, I know.
32:46
Everyone has--
32:47
Annette: I'm sure friends, family, obviously, there were some backlash from
32:50
your daughter, but what was the rest?
32:53
Julie: Mostly people were excited for us.
32:54
This is not something that would've been terribly surprising to
32:57
most of our nearest and dearest.
33:00
A lot of our closest friends had been part of that conversation with us
33:04
where we would be saying, oh, wouldn't it be nice to do this again someday?
33:08
So they always knew that we weren't necessarily going to stick around, um, in
33:12
Vancouver forever, that there was a chance we were going to go settle somewhere else.
33:16
So yeah, when we did make the big announcement, it was
33:18
like, oh, that's super cool.
33:20
And mostly supportive.
33:22
A few people expressed concern for our daughter and the impact
33:26
it was going to have on her.
33:27
And it came from a place of love, not a place of judgment that, are
33:30
you making the best decision for her?
33:32
And we had to give that a lot of thought.
33:36
But everybody that we had spoken to who-- we've got friends who
33:41
grew up with military parents who got moved around a fair bit.
33:45
All of those people said, I hated it at the time, but as a person,
33:50
I grew and it helped me with what I was doing in the future.
33:54
It made me more comfortable with change when I went off to university.
33:57
It made me more comfortable with change when my husband or wife's
34:00
job transferred us to-- it just made them more comfortable with change.
34:03
And so helped us a lot with our decision, um, and being more comfortable
34:08
that we were doing the right thing.
34:10
Sarah: You are in our mastermind group, Hosting Business Mastery Members.
34:13
What I would say, 90%, if not more, of our members are not only US citizens, but
34:19
they own property in the United States.
34:21
We now a few members who live elsewhere and own elsewhere.
34:26
What [Inaudible] we talking about that you learned as an international host?
34:32
Can you think of anything off top of your head?
34:34
Julie: Oh, yeah.
34:34
How much time have you got?
34:35
Sarah: Oh my God, so much time.
34:36
I'm so interested.
34:37
Julie: So I've already touched a little bit on the culture change,
34:40
and how we need to understand that we are the guests in a foreign country
34:44
and that things are done differently.
34:47
And it's not up to our hosts to adapt to us.
34:50
It's the other way around.
34:51
We need to adapt to the way things are, and understanding that family comes first.
34:55
And also an effort to learn the language.
34:59
That has helped me tremendously because you can't assume that your cleaners, or,
35:06
I mean, in my case, hardly anybody that I deal with on the daily in regards to my
35:10
business, whether it's a trades person, a repair person, air conditioner repair
35:15
or replacement, um, my property manager, my cleaners, they all speak Spanish.
35:20
And I, through taking a weekly lesson, but also a whole lot of Google translate,
35:25
a whole lot of people, I've had to just learn to communicate and learn the
35:29
ways of things being done down here.
35:31
It's funny when I first started with HBMM, we were learning about all this different
35:34
tech and all this really cool stuff, and I was like, oh yeah, how cool would that be.
35:39
The reality is that they really like WhatsApp down here.
35:43
Annette: Yeah.
35:43
Julie: And so everything is done on WhatsApp and it's cool.
35:49
We create groups.
35:50
I've got a group that includes my cleaners because the place that we purchased here,
35:55
it's part of a seven-apartment condominium complex with an onsite caretaker.
35:58
And that was extremely appealing to us because as our first purchase in a foreign
36:05
country, we wanted a bit of a handholding, a bit of a comfort zone there.
36:09
So having an onsite caretaker helps a lot with that.
36:12
The seller's agent turned out, uh, to be very knowledgeable about hospitality,
36:17
and so we hit it off right away with us, and she became, not a full on
36:20
property manager, but she handles our check-in and checkouts with us.
36:23
But all of that is done in Spanish and all of that has
36:25
required a whole lot of learning.
36:28
And so, yeah, we do it all on WhatsApp.
36:29
We take photos.
36:30
So if there's something that's not quite right, they'll take a picture of it
36:34
for me and send it to me on WhatsApp, like something's broken, something's
36:37
not right or they've got a question.
36:39
We just had a new cleaner and so we had to teach her how things
36:44
were done with the previous cleaner and how were things we want now.
36:47
So she would make the bed, take a picture, is this okay?
36:51
No.
36:51
We want this done.
36:52
And then she'd take another picture and send us again, is this right?
36:55
And so there was a lot of that going back and forth.
36:57
And so we just had to be very, uh, very cognizant of that.
37:01
Also to keep in mind, not everybody's level of literacy might be what
37:06
you're used with where you're from.
37:08
Being able to voice messages.
37:11
Um, a lot of people in Costa Rica prefer to do that rather than spend
37:14
time typing out a long message.
37:16
They'll just hit record and message you something.
37:18
So you've got to be comfortable with that.
37:21
Infrastructure is huge.
37:23
The infrastructure here is not at all what we're used to back in North America.
37:27
So the power will go out.
37:29
The internet will go out.
37:31
The water will go out.
37:32
And sometimes all three on the same day and all at once.
37:34
And sometimes when you've got a guest staying there, sometimes when you've
37:37
got a guest checking in that day, so you've got to be prepared for that, but
37:41
you also need to prepare your guests.
37:42
Annette: How do you prepare them for that?
37:44
Is that something you say very clearly upfront?
37:47
I mean, are you reimbursing for that or do you just let that
37:50
be very known that's the way?
37:52
Julie: It's part of my listing, and I call it my Price of Paradise clause.
37:56
Sarah: Ooh, I like that.
37:57
Annette: Copywriting.
37:59
Yeah.
37:59
Sarah: Hosting hot tip.
38:00
Julie: I just call it Price of Paradise.
38:02
And it says, this municipality is subject to occasional water,
38:06
power, and internet outages.
38:08
We provide bottled drinking water.
38:09
We provide flashlights, and we provide an uninterrupted power source, also
38:13
known as a UPS, and therefore there'll be no discounts for any inconvenience.
38:17
So we're stating upfront what we are already doing for them.
38:21
And showing that we are being proactive.
38:26
But these things are beyond our control and we can't really do much else about it.
38:31
Annette: Price of paradise.
38:32
Julie: And so by knowing that upfront, we feel that they know what to expect.
38:36
It's also in our guest manual, so if they have missed it, they also see it.
38:41
And so far it hasn't been an issue.
38:44
I mean, it's happened, but then right away, I'm communicating with the guests
38:48
and saying, hey, I know the water's out, Sophia's going to drop off some
38:52
extra bottled water for you guys.
38:54
Hey, I know the internet is out, I've been in touch with the
38:56
provider and they're working on it.
38:58
I'm having to be proactive in communicating during this day and making
39:01
sure they know that I'm aware of it and that I'm looking after them as best as I
39:04
can by providing them with some options.
39:06
And most of them are like, oh, we're just going to go to the beach, no problem.
39:08
Sarah: And what another great tip.
39:09
I don't care where you live, but to be proactive and to have things set up.
39:13
So you know the powers out, you let your guests know first.
39:15
They don't let you know first.
39:17
As best as you can.
39:17
Especially in today's technology, if you're able to get those notifications.
39:21
We continue to impress our guests whenever we let them know.
39:24
They're like, oh my gosh, I didn't even know.
39:25
We were out getting bagels.
39:26
And I'm like, maybe you want to stay out a little longer because
39:28
there's no power back there.
39:30
And just letting them know that you care and that you're on top of it.
39:33
Julie: And sometimes they have been the ones that let me know.
39:34
I mean, the tech isn't perfect.
39:37
Sarah: Right.
39:37
Sure.
39:38
Julie: So sometimes I-- or I'm driving and I don't get the message
39:42
until I'm at the grocery store, so I don't always get it immediately.
39:44
And so we have little gifties that we have.
39:48
They're in the land of coffee and chocolate, and so we always have
39:51
some extra coffee and chocolate on hand so that we can drop it
39:54
off as a little care package.
39:56
Business we talk about in HBMM, whether it's coffee or bagels or whatever.
40:00
We do that little treat to smooth things over.
40:02
And up until now, like I said, people have been really good about it.
40:05
And I don't know if it's because they were prepared and already told about it
40:08
upfront or because we're communicating with them and we're not making excuses,
40:13
we're being proactive, that they just seem to appreciate that a lot.
40:16
Annette: I know we just went over the stuff that we didn't prepare you for, but
40:19
we're going to do a selfish plug here.
40:21
Talk to us about being a part of our group because you are in Costa Rica and
40:25
a lot of our members are here in the US.
40:27
Sarah and I like to know how you found us, why you made that
40:30
decision to join our group, and what the group has done for you.
40:33
Julie: I actually found you guys through the podcast initially.
40:36
I was just trying to find information out there because my husband and I
40:39
have always liked looking after people and we really wanted to focus on that
40:43
part of hosting for short-term rentals around the time that we were purchasing
40:47
this first one, um, in Costa Rica.
40:49
And I just wasn't finding a lot of information out there.
40:51
So when I came across you guys, I was like, holy crap, this
40:54
is what I've been looking for.
40:55
And then I think you did a plug about joining HBMM, and
40:59
talked about it with my husband.
41:00
And I said, we've invested in your career and your learning with
41:04
long-term rental over the past few years, now it's time to invest in me.
41:09
And so we did that.
41:11
And biggest takeaway I've gotten from you guys is how to look after the guests
41:15
and the messages before, from the time that they book and few days before,
41:22
and the morning after their first night, and the checkout messaging, and
41:26
asking them for the review afterwards.
41:29
All that really caring for the guests and making sure that you provide some extras.
41:34
Don't just provide four forks.
41:37
Make sure the place is well kitted out.
41:39
And all that list you guys provide, I mean, I was using
41:41
that like a complete checklist.
41:43
Okay, I've got to make sure I've got extra sheets on hand, extra
41:46
towels on hand, extras of extras.
41:49
So I found that was really helpful for me.
41:50
And also the community.
41:52
Just being able to talk with other people who had that same focus
41:55
and that same care for the guests.
41:57
Annette: I think that's the biggest thing is you don't
41:59
realize you need the community.
42:01
Because you said you talk to your team a lot, obviously, you're
42:04
WhatsApp-ing constantly with them.
42:06
But it's like you want to talk to other hosts and see what challenges they're
42:10
having, what wins they're having.
42:11
And that's where it's like, oh my gosh, wait, where are these other people?
42:15
And let's talk about that one last thing here is, how are you connecting
42:19
with-- are there other expats that you're becoming-- are you host friends
42:24
with anybody, um, in Costa Rica?
42:26
How has that been going for you?
42:27
Are you meeting other hosts there?
42:30
What's that look like?
42:31
Julie: So one of the closest friends that we've met here, she's actually a neighbor
42:34
of mine, but there's a little hotel just down the road and she owns that hotel.
42:38
And she, like me, is very guest-focused.
42:40
And so we bounce a lot of ideas off each other because we're both
42:44
doing this in a foreign country.
42:45
She's from the US.
42:47
So if she's having a challenge with a guest, she'll bounce something off me.
42:50
If I'm having a challenge, I'll bounce it off her.
42:52
We both have dealt with staffing issues in the past year.
42:55
How do we handle those delicate situations?
42:59
So it's been really helpful to have her and likewise.
43:02
Annette: No, that's so cool.
43:03
Love it.
43:04
Sarah: All right, Julie, we don't know about living abroad and owning abroad,
43:08
so what parting words do you have for our listeners that maybe we ask you
43:12
want to make sure that they know if they're thinking about buying anywhere
43:16
in the world other where they live?
43:17
Annette: Yeah.
43:17
What would you have told Julie when you and your husband were
43:20
getting ready to take a dive?
43:22
Julie: Well, for starters, be prepared to be paying for things in cash.
43:26
We're so used to, as North Americans, putting everything on the credit
43:29
card and then dealing with it.
43:31
That's just not how things work in many international markets.
43:34
You have to be prepared to pay workers in cash.
43:37
Many small businesses want cash.
43:39
And that has a little bit to do with taxation, which is
43:41
a whole other conversation.
43:43
In some markets, accepting a credit card, those businesses that don't want
43:46
to take the extra hit, that 3%, that 5%.
43:49
So you need to be prepared to have money on hand to do that.
43:52
Over and all, go with the flow and don't sweat the small stuff.
43:56
Don't worry about whether your cleaner put the pillows back on the bed exactly
44:01
the way you want or whether all the mugs are lined up in the cupboard just right.
44:05
It might be important in some markets.
44:07
Here, you worry about whether your power's going to stay on during
44:10
the guests stay or whether the air conditioning is going to crap out.
44:13
And I've had to deal with that and I've had to be prepared to
44:19
with it very quickly and come up with the solution very quickly.
44:21
And so you just need to be very-- go with the flow.
44:24
You'll have your little internal moment.
44:29
Annette: Right.
44:29
You can take hard, but the others, you need to take the impact of it.
44:33
Julie: Yeah.
44:34
Exactly.
44:35
You need to just be focused, okay, move on, what's the solution, and
44:39
let's deal with this and get it done.
44:41
So yeah, you can't be bogged down with sweating it.
44:44
Annette: Love it.
44:45
And we will make sure, listeners, we will put Julie's listing in the show notes.
44:50
So if you are traveling, please let her know you found her on the podcast.
44:53
Stay with her.
44:53
Sarah: I'm about to ask Annette if she wants to go to
44:55
Costa Rica and stay with you.
44:57
This sounds nice.
44:58
Annette: This episode is really fun because I love that you just -. You
45:04
and your husband obviously didn't happen that swiftly, but you made
45:08
the decision and you went for it.
45:10
Because I know there's a lot of people that are out there with
45:12
hopes and dreams and they've been waffling on it for a while.
45:15
So listeners, if this impacted you and you're getting ready to make a change,
45:19
let us know so we can let Julie know that her story was inspiring to you.
45:23
But go visit her also in Costa Rica.
45:25
Julie: I think for us, the biggest thing that we always go back to,
45:28
what's the worst that can happen?
45:29
I moved from Montreal to Vancouver with that mentality.
45:32
If this relationship doesn't work out, I either decide to stay or I turn
45:35
around and go back to where I came from.
45:37
We moved here, what's the worst that can happen?
45:39
We bought our first property, what's the worst that can happen?
45:42
Either it works or it doesn't work out.
45:44
And what do we do to move on?
45:47
And just to not get caught up with it too much.
45:50
Sarah: That is solid advice for so many things in life.
45:54
I mean, obviously, you want to think about your decisions
45:57
and weigh the pros and cons.
45:58
Of course.
45:59
But when you ask yourself what's the worst that can happen, and you're like,
46:02
hmm, that's actually not the worst thing.
46:04
Yeah, that's not great, but I have to move back.
46:06
But I can move back.
46:08
Annette: I said you made a swift decision, but I love when we started digging in
46:12
to how you decided on the location, everything was so-- you had your head on
46:18
straight like, we want to be in this time zone if we need to get to our parents.
46:21
We want it to be warm.
46:22
All of a sudden, it's like, wait, this decision that seemed from left
46:25
field was very, very calculated and had a lot of time and a lot
46:30
of your research also behind it.
46:32
So it wasn't just out of nowhere.
46:34
So I think we also just count all the pieces and parts that go into it.
46:37
So hopefully we will see you not just on our Zoom calls with your beautiful
46:41
background, but we'll be with you by your pool in the background.
46:45
Sarah: Awesome.
46:45
Julie: I'd love to have you.
46:46
Sarah: Thank you so much, Julie, for your time and your openness about your story.
46:52
With that, I am Sarah Karakaian.
46:54
Annette: I am Annette Grant, and together we are--
46:56
Both Annette & Sarah: Thanks for Visiting.
46:57
Sarah: Talk to you next time.