Votre Histoire.co
Philippe took a job in Vancouver, so we moved away in May 2018. We also turned the property we were living in into a short-term rental. By March 2019, we had three rental properties generating income, but we were investing all the money coming back into renovations.
That March, we bought a third property for CA129,500 with a 20% downpayment and mortgage. It took nine months to renovate, and I worked with a contractor because it needed a lot of work.
We moved back to Quebec in August 2019 and bought another condo in Montreal. We funded the downpayment through an equity release in the form of a mortgage on our personal home turned short-term rental.
In October 2019, we bought another house. It was CA220,000 with a 20% downpayment, which we financed using income from the other rental properties and personal savings.
Then, in July 2020, we purchased a neighboring property. However, because our bank had a limit on the number of short-term rental properties you could take out personal loans for, we borrowed money from family to pay the full price of CA277,000 for it.
We paid them back after selling our condo in Montreal and still have mortgages on five out of six short-term rentals. We now live in another house we bought and renovated in Orford.
We’ve been trying to rely less on third-party booking platforms like Airbnb
We lived on Philippe’s salary until 2020. For the first couple of years renting out properties, we ran at a loss due to the cost of getting started and reinvesting money back into buying properties.
Upfront expenses of investment properties are significant. But the time it takes to be cash flowing is shrinking now we have formula that helps us execute faster.
I was able to build income and wealth for our future, while Philippe’s salary more than covered our daily expenses. He left his job in the legal software space in February 2020, and his severance package covered our living expenses for a while.
When the COVID-19 pandemic hit, it disrupted our business, and we had to flip all our properties into monthly rentals to comply with government regulations. After COVID, the market exploded because everyone wanted to get away.
Guests loved us and were referring their friends, and we were featured in some media outlets.
At that point, I realized that if we could keep occupancy up, we could live off of our six properties.
I focused on our direct booking strategy. Third-party online travel agencies like Airbnb and Expedia hold too many cards — they decide whether you’re on page one or page 25 of their website and how to handle complaints. I worked hard to build our social media presence and website.
I pay for a property management software called Lodgify, which allows me to see every reservation across the different OTAs and our website and what days are open on our calendar.
In 2019, I’d say all of our bookings were coming from OTAs like Airbnb, but in 2023, my calculations suggest that out of the CA340,000 we made in revenue, roughly 70% came from direct bookings.
Having a hospitality business is a full-time job, not a ‘passive’ income stream.
Real estate has historically been thought of as passive income, running short-term rentals is not passive.
Providing the necessary level of hospitality is more of a full-time job. We’re owner-operators who put a lot of work into the guest experience.
We’re available seven days a week. I work 50 hours a week doing marketing, bookkeeping, and maintenance. We also have an operations manager who handles day-to-day cleaning and inventory. Depending on the season, there’ll also be two to three part-time cleaners.
We love what we do and find it so fulfilling, so the good far outweighs the stress.
The hospitality industry is flexible, and I do think there are ways people can do this in addition to another job, but I worry about the quality of service provided.
You hear horror stories about people arriving at properties that aren’t clean or where things are broken, and it has a negative impact on the industry.
Side-hustling with short-term rentals needs to be done in a way that honors the industry.
Even those who say they work four hours a day from a beach on their real estate business will have had to put a lot of work into their support and team structure to be successful.
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