Tax Smart Real Estate Investors Podcast

Episode 317: Crush Break-Even: Pricing and Occupancy Hacks for Your STR with Avery Carl

Date: March 18, 2025
Host: Hall CPA
Guest: Avery Carl (Founder, The Short Term Shop; Author, Smarter Short Term Rentals)

Episode Overview

In this episode, Hall CPA sits down with Avery Carl, a short-term rental (STR) investing expert, agent, and bestselling author. The conversation covers acquisition tips for newcomers in 2025, strategies to optimize STR profitability, the impact of current interest rates, effective self-management, amenity myths, and insights from Avery’s new book. Avery dispels common misconceptions, offering actionable advice for both rookie and seasoned STR operators.

Key Discussion Points and Insights

Avery's Background in STR Investing

• Avery Carl has built a portfolio starting with eight vacation rentals, now holding about 250+ diverse units.
• She leads The Short Term Shop (65 agents in 20 markets), helping 5,000+ clients buy and manage STRs without traditional property managers. (02:02)

Top Acquisition Tips for New STR Investors (2025)

• Market Familiarity is Key:
  “Buy in the place that you have a competitive advantage... If you are or have been your target guest, that’s the best intel you could ever have.” — Avery Carl [03:19]
• Avoid Chasing Cheap Properties:
  Don’t buy solely on price. Choose property types guests want (e.g., cabins in mountain markets)—guest appeal drives occupancy and income, not just bedroom count or price. (04:19)

Cash Flow vs. Appreciation

• Blend Both in Your Analysis:
  Cash flow is crucial, but neglecting appreciation can backfire if external factors force a sale. “I used to say cash flow only; appreciation is garbage. But it really would have been nice if... there would have been a little appreciation.” — Avery Carl [06:30]

Financing and Interest Rates in 2025

• Loan Types Trending:
  • DSCR (Debt-Service Coverage Ratio) loans are still used but have high rates.
  • Many opt for 10% down “vacation home” loans (with required personal use) or 15% down conventional investment loans, often in a personal name due to lower rates. (07:12)
• Market Slowdown: “We've been in the crash for two years, guys... Fewer homes were sold in those past two years than in the last 30 years.” — Avery Carl [08:11]
• High rates have stalled sales and acquisitions; any drop toward 6% may renew activity.

Recovery Outlook and Political Influence

• Recent administration has enacted more measures for housing than prior years, but real change depends on interest rate movement and macroeconomics.
  “The fact that somebody is in there trying to move things around I think will eventually [have an effect]… I’ll be interested to see.” — Avery Carl [12:17]

Optimizing and Operating a Profitable STR

• Dynamic Pricing & Breaking Even:
  Many hosts cling to a hard “break-even” nightly rate. Avery advises flexibility:
  “Your break even number is an average. In the high season, you’re going to get much higher... in the low, you’ll have to drop below. Otherwise, your place sits empty for $0.” — Avery Carl [13:57]
• Temporarily lowering prices can “wake up the algorithm” and boost bookings.
• Reviews & Occupancy:
  “Photos are like top”—guests choose with their eyes, so invest in pro photography. (23:30)

Amenities and Design—Mythbusting the "Go Big" Narrative

• Contrarian Take:
  Lavish amenities (pools, pickleball, murals) only pay off in select markets (e.g., Orlando); extras can shrink your buyer pool and rarely add resale value. “You have to be sure you are going to hold this property for at least 10 years. Murals don’t add value to a house… If you have to sell, you're not getting that [investment] back.” — Avery Carl [16:17]
• Instead, follow the “Three C’s”:
  “Cute, clean, comfortable has been enough for ours.” — Avery Carl [20:53] Update outmoded elements, keep it spotless, and focus on universal guest comfort.

Unit Mix and Consistency

• Studios and one-bedrooms can be top performers in vacation markets (not urban hotel areas).
  “Just because a property is a one-bedroom doesn't mean it can't be luxury or nice... Studios and one bedrooms consistently stay booked.” — Avery Carl [22:23]

Guest Experience & Hospitality

• Preemptively answer guest FAQs with digital guidebooks (Touch Stay, etc.) sent at booking. “For me, it's making sure that their questions are answered before they even have them. That's really the biggest piece.” — Avery Carl [24:23]
• The less a guest needs to reach out, the better their experience and reviews.

Systems, Scaling, and SOPs (from Avery’s Book)

• Develop process checklists for recurring scenarios (guests find a hair, cleaning issues, market-specific risks, etc.).
• Avoid over-leveraging in the rush to scale after initial success. “You’re going to run into like the same ten scenarios over and over again in your property... We teach you how to build your systems and processes around these things and how to properly scale without over-leveraging yourself.” — Avery Carl [26:02]

Notable Quotes & Memorable Moments

• On Choosing a Market:
  “No spreadsheet can outperform just true knowledge of your market.” — Avery Carl [03:19]
• On Luxury-Themed Rentals:
  “At this price point, we really want a luxury feel. And the murals on every wall kind of feels childish.” — Avery Carl [18:31]
• On The Reality of STR Investing:
  “You can do this. You can be a successful real estate investor, not just short term rental investor, starting from wherever you are... I was making $37,000 a year when I bought my first short term rental.” — Avery Carl [34:12]
• On Managing Remotely:
  “It really is just kind of a mindset shift. If the toilet breaks in my office... I’m going to make a phone call just like I would if it’s a hundred miles away.” — Avery Carl [28:19]

Timestamps for Key Segments

• Avery’s Background & The Short Term Shop — 02:02
• Acquisition Advice for Beginners — 03:19
• Property Type Mistakes — 04:19
• Cash Flow vs. Appreciation — 05:21
• Financing Trends & Sentiment in 2025 — 07:12
• Market Slowdown Reality — 08:11
• Recovery Outlook & Political Actions — 10:53
• Optimizing STR Profitability (Break-Even, Pricing) — 13:57
• Amenities: The Big Debate — 16:17
• Three C’s for STRs — 20:53
• Best Unit Mix for Consistency — 22:23
• Guest Experience & Digital Guidebooks — 24:23
• SOPs and Scaling Without Overleveraging — 26:02
• Self-Managing Efficiently — 28:19
• Finding Cleaners and Vendors Remotely — 30:14
• STR Shop Markets & Expansion — 31:06, 32:26
• Closing Encouragement to New Investors — 34:12

Actionable Takeaways

• Buy where you know the guest perspective—personal familiarity is invaluable.
• Don’t overspend on amenities unless you’re committed long-term; focus on core quality (cute, clean, comfortable).
• Be flexible with pricing, especially during low seasons—occupancy drives algorithmic visibility.
• Systemize your business with SOPs for repeatable guest scenarios and property issues.
• You don’t have to live nearby; remote self-management is realistic with the right team and tech.
• Start where you are—income level isn’t a barrier if you’re strategic and persistent.

Connect & Resources

• The Short Term Shop: theshorttermshop.com
• Book: Smarter Short Term Rentals (Available at BiggerPockets, Amazon, Barnes & Noble)
• Avery on Instagram: @theaverycarl and @theshorttermshop
• For STR analysis help outside STS markets: stsplus.com

Final Thought:
“You can do this. Start from wherever you are, and don’t let anyone tell you otherwise.” — Avery Carl [34:12]