** Sub-renters the fatal mistake to avoid when making your prices **
In this live I share my unstoppable tip for sub-renters when determining their sales price on Airbnb, booking, etc. to avoid the mistake that everyone makes.
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Hello to you, and welcome to this new video from the YouTube channel I display Complete. I hope you're doing well. Today we are going to talk about a problem that particularly affects professional sub-renters. Subletting, if you are not familiar with it, is a method which allows you to re-rent a property where you are the tenant yourself. So, I'm going to talk with you about the mistake we generally make when we determine our prices when we are under rental. But before that, already, I wish you an excellent year 2021. This is the first video that I am going to make this year, so this is the really perfect opportunity for me to tell you that I wish you a happy new year 2021 which is much more favorable than the year 2020 for seasonal rentals. It’s true that this past year has been complicated. We all coped courageously with more or less good financial performance. It's true that we were lucky, at J'poster Complet, to succeed in allowing our customers to get their heads above water despite adversity, despite the difficult contexts that we experienced. So listen. I hope that in 2021, we will have fewer challenges, that it will be a long, quiet river, we will hope, we will knock on wood. In any case, whatever happens, we will be here, we will be there at your side to help you increase your turnover.
So, if you are not aware of a certain number of mistakes that you must avoid when determining your prices, whether you are sub-renting, gîte, guest house or seasonal rental, quite simply, I can only tell you encourage you to download our bonus – you have the link just below – which consists of giving you six mistakes not to make when you determine your prices. And what could be better than joining our private group to get this bonus? So the link is right below. This is the private group link. You'll see, it's a group where we share lots of things and topics about seasonal rentals, so you'll be in good hands. You will be with pros like you, and by subscribing to this private group, you receive your free bonus of the six mistakes not to make. So, it’s two birds with one stone, as they say.
Today we are going to share the fatal error that I observed for sub-renters. When we sublet, we have the following context: we managed to convince an owner to entrust us with his apartment so that we could be sub-tenant ourselves, that is to say we will rent the owner of his property, and we will exploit it, obviously in the best legal conditions. I refer you to people who are experts in this. You can't sublet just like that, you have to do it correctly from a legal point of view. Once you have this in place, you will re-rent a property you are a long-term tenant. You will rent it again for a short period. In this case, you are faced with a situation: what price should you determine on Airbnb, on booking, or on your direct site? What price per night should be determined for your apartment? I'll tell you the error right away. The fatal error that I observe among seasonal rental companies is to take the price that the owner asks them, and to divide by thirty or thirty-one days depending on the number of nights in the month. It gives a price per night, and the person says to themselves: “I'm being asked for 300 euros per month, divided by thirty nights, that's 10 euros per night. My minimum price, these 10 euros. » The example is not very well chosen, since it therefore gives a price which is extremely low in any case, but sometimes, we can arrive at an amount per night like 50 euros per night, 60 euros per night .
Taking this amount as a short-term rental amount for your seasonal rental, or at least as a floor amount, is a bad idea. This is really a bad idea, because depending on the city and depending on the rental value of the property in the long term, so depending on the value of what you are renting, you may have periods during which it is necessary to go lower on the price in the short term, unfortunately, and yes, it happens. There may be months when, in fact, the market price is lower than this value. Except that in the end, as there are so many other periods in the year during which we have the potential to rent for more than the price you rent, for the year, in the end, it is much more interesting . So, obviously that means having excellent management of your cash flow, because there will be months in which you will earn less, but this is exclusively for certain periods of the year, and not the whole year. I'll make a digression: if ever, it turns out that it's all year round, it's just that the calculations were poorly done initially to take charge of this sublet property, and therefore I mechanically exclude these cases. But if we start from the postulate that you have done your calculations well, even having done your calculations well, it is possible that sometimes, over extremely short periods, you will be led to observe that the rental price that it is possible to put , in the end it is unfortunately lower than the price that you will owe to the owner. But overall, over the year, you will earn more than what you will owe to the owner.
If you don't do that, if you rely on what you owe the owner instead of relying on the market value of the property at time t, what risk are you taking? In fact, the risk you are taking is very simple. It is simply not to rent, or to rent very little. So in the end, if you are stuck on the value that you owe to the owner, I will take the example of the month of January. In general, it's a month that is not very good in the different cities where we are present at J'poster Complet. If in January, you say: “I owe 60 euros per night. I pay 60 euros per night”, what will happen? In the end, what are you going to sell? Five nights, ten nights in the month? And you will end up with a sum of money that will be less than what you could have claimed by having placed the correct market price. Let's assume that the market price is 40 or 45 euros. With 45 euros, which is the good market price, you can, for example, have a fill rate that is much higher. I give examples. You can have a fill rate of 70%, 80%, 90%. And at 45 euros, at 80% occupancy, your turnover is much better than staying stuck at 60 euros, but filling five or ten nights. So, that's why it's sometimes more in your interest to do this slightly counterintuitive trick which is to say to yourself: "I agree to set a price a little lower than what I'm going to owe to the owners." , because in the end, it will allow me to fill the apartment well over the month, and therefore to have a better turnover than if I remain stuck on the precise price that I owe to the owners, and that by Therefore, I will be too expensive, and therefore, I will not rent at all or very little. ".
The last question we can ask ourselves after listening to this video and this advice that I give is: how do we determine the market price? There, for once, you are entering into the same logic as the entire brigade of seasonal rental companies that we all are, whether we are under rental, seasonal rental, gîte, or seasonal rental concierge. There, therefore, the methodologies are always the same. These are methodologies that we already share extensively on the J'poster Complet channel, but I'll give you some keys. The first thing is obviously to study market demand. And for that, the tip that I can share with you is to go see a site like AIRDNA which will give you an idea of market trends. So much for this tip to start the year off right.
− Hello Axelle. Welcome to you. “Nice to see you again.” THANKS. I too am happy to see you again. I wish you an excellent year 2021.
Listen, I'll remind you of one last thing, which is that I'm going to resume the wave of daily videos, so I'm going to make a video every day from Sunday to Thursday. As you will have noticed, I took a little break for Christmas and New Year. I hope, and I am sure, that you will forgive me. Ah, I didn't see Romain's message.
− Romain: “Hello, and best wishes for this new year. »
Thank you so much. To you too, I wish you an excellent new year 2021. So, I am resuming this rhythm of videos every day from Sunday to Thursday. If you have topics, points, questions on which you would like to have an answer, do not hesitate to share them with me in the comments just below this video. This will allow me to use this subject to be the subject of a future video, and to answer your question with great pleasure. I also encourage you to subscribe to the J'poster Complet channel on YouTube which will allow me, and which will allow you to be alerted as soon as I am live. This is an opportunity for you to be with me live and ask me your questions, because I can clearly see the questions that are asked to me from YouTube. So don't hesitate. So I wish you a great day, and I'll see you tomorrow for the next video.