How Backyard Amenities Turned One STR into a $217K Performer with John and Christina McNaught

0:00Welcome to the short-term show, the show about short-term rentals and long-term wealth. With real property owners, hosting real properties, who are crushing it in the vacation and short-term rental space. And here's your host, Avery Carl. Hey, all. Welcome back to another episode of the short-term show. Today, we have John and Christina McNaught. They are the short-term shop agents in the Braydenton, Florida area and a bunch of other little surrounding areas down there, but they are really experienced investors. And we haven't really had any guests on to talk about their experience as short-term rental investors in that part of Florida. So I'm really excited to have them on John and Christina. How's it going? Fantastic. It's going great. Awesome.

1:00Thank you so much for coming on. So let's start by just tell us, our audience, I know about you, but tell our audience a little bit about you and how you got into real estate investing, specifically short-term rental investing. Sure. I think it started. So we started investing in real estate in 2013. Back then, I had a W2 job as an electrical engineer, designing fire trucks and ambulances. We used my good paying W2 to start buying properties. We started in long-term rentals. We started single-family long-term and got our first property remodeled up and running and realized the cash flow really wasn't there with long-term stuff, particularly single-family. So next property we bought was a duplex. Found out that with multi-family, there's a lot more opportunity there. So instead of making a hundred bucks a month, then we were making a thousand. So obviously moving in the right direction.

2:02The next property we bought in 2017 was a two-unit property, but it had a pool. And 2017 Airbnb was around, but it wasn't as popular as it is today. And Christina had brought up this idea about renting the one-bedroom, one-bath side of the two-unit property as Airbnb. Back then, I looked at her and I go, what the hell is an Airbnb? You didn't know what she was talking about. I didn't even really know what I was talking about, but we lived in the one side of it. So I was like, why don't I want a full-time person living they are ensuring the pool with us? So we did this Airbnb thing, maybe a couple of times a month they would be there. So that's where it started. So we got it up and running as a short-term rental. And basically this little one-bedroom, one-bath, basically like a mother-in-law suite, wind up paying the mortgage, paying all the bills, and putting a thousand bucks a month in her pocket.

3:03So we were like holy cow, we're onto something here. So ever since then, again, this was 2017, we wind up selling all our long-term stuff and moving strictly into short-term. We bought another two-unit property and this time we built two pools. Since then, we've acquired plenty more, but in 2020, January 7, 2020, I finally left my W2 job and we moved into real estate full-time, both with our own rental properties. So today we have six of them and selling real estate for other people. And basically that kind of came along with we had a bunch of people seeing what we were doing. They saw me leave my very good paying W2 job, but we went into this real estate thing with a bunch more time on my hands, you know, past of income, and they were like, can you help me find one? So we went down that path and now I want to say what was it, 2023?

4:10We joined forces with you and... Oh, has it been that long? My goodness. Yeah. And the rest is kind of history. Like I said, today we have six short-term rentals that we currently own and manage. We sell short-term rentals, obviously, in the Braidings in Sarasota and Clearwater St. Petersburg markets over here in the West Coast of Florida. And that's kind of us. You know, since we do have, you know, a number of properties in this market, we have a really good, you know, feel for what that guest avatar looks like, you know, what amenities drive revenue, what works, what doesn't work, and you know, we use all that information and experience to really, you know, help our customers be successful. Thank you for joining us. Here at the short-term shop, we help real estate investors like you buy and sell vacation homes. We operate in over 20 true vacation markets across the United States.

5:13If you have more questions about buying and selling, join us every week for a live Q&A at strquestions.com. That's strquestions.com. Awesome. Love that. So I have a few questions. So the first one is every time I post something on Instagram or TikTok about a Florida market, people come flying out of the woodwork to hate on Florida and to say we have Florida is the worst state. And we have our insurance is insane. Our taxes, property taxes are insane. And for me, I always say, you know, like, well, I've bought three in Florida in just the past year. And it's not really, the insurance is not really as bad as people make it out to be. Like, it's not great. It's not getting insurance in Kansas, which I've never, I have no idea. That's just an example. Maybe it's not bad in terms of still being able to cash flow.

6:17So what would be y'all's response to that? I so I explain to people that, you know, insurance is very property specific, meaning that if you're going to buy, you know, a hundred-year-old woodframe house, that's going to be a very different insurance right then, you know, in New York construction block home. If you're in a flood zone versus not in a flood zone, you know, those are, again, property specific things. But insurance is not all the doing along the internet makes it out to be. And more properties that may have a higher insurance rate, there's, you know, things that we can do to mitigate those rates. I don't want to really get into all the details, but, you know, there's this thing called adding the third nail to your roofed wall connection that can reduce your insurance rates dramatically. So, you know, we have, we have a lot of little tips, tricks, and things that, you know, we use to help guide our clients along the way. And really, welcome Noah up front. You know, if this is something that we should be concerned about insurance-wise or, you know, if this, if this is something very reasonable. And I equate it

7:21to basically this, your insurance rate is probably going to be around what a one-night stay per month costs. So, if you look at it from that perspective, one night of every month it's going to pay your insurance. Good hack. I'm going to, I'm going to look at mine now and see if it does that in Florida. That's a good one. Write that down, guys. So, okay. And then also the age of the roof, I think, is a big one in terms of insurance. If your, as long as the roof is newer than 10 years, needs to be newer than 10 years or newer than 20. The absolute, you know, the absolute most that they'll allow is it has to have at least five years of life left on it. Okay. That's a, you know, requirement that started a couple of years ago. It used to be three, but, you know, the newer the roof, the better. Yeah. Of course. Also the type of roof, you know, different types of roof, such as a metal roof will get you a better rate, but generally speaking, you know, the newer the better. Gotcha. And I want to hear about the seasonality in Bradenton. So, I know it's a little

8:22bit different than a lot of other markets that are really popular. So, we know we see a lot of like high summers, the high season and, and that's what it is. So, I know you've mentioned that the, the high season in Bradenton is a little bit different. Can you tell our audience about that? Sure. So, if you think of our seasonality, just it basically mimics the kids school schedule. You know, again, our primary vacation vacationers or families. And, you know, our highest season is March, when spring break occurs. Our main season is basically Christmas through Easter, again, with the high in March. And then it slows back down when the kids go back for finals in May. When the kids get off school for summer break, it picks back up again June, July and August with July being the number two month of the year. So, it's really great because we have kind of peaks at opposite ends of the calendar. So, it really helps balance your cash flow throughout the year. When the kids go back to school in September, you know, September is our slowest month of

9:26the year. So, we always just tell people if you have any major improvement projects or, you know, things, amenities you want to add, just flying for September. And we call it a September project. September project. Yeah. Yeah. So, that is a little bit different than up here in Northwest Florida. And I think that's interesting because as people scale and they want to maybe stagger their markets, if they're in multiple markets, you know, they want to stagger where the high seasons are. So, they're never fully empty across their entire portfolio. They've always got something that's in the high season. So, that's pretty interesting. And another thing that I wanted to ask all about is there's a lot of different little areas and pockets in your neck of the woods. So, Braytonton is very popular in the short-term rental investing world. And, but places like C.S. DeKey are really popular in just the vacation space. So, if somebody's interested in buying in that part of Florida, how do they kind of decide, well, do I want to be out on one of the keys

10:28or do I want to be in and Braytonton? And then there's not just Braytonton. There's like Seminole and Largo and all these other little pockets in there. So, can you kind of break those down for us? And maybe it'll help some people who are listening figure out exactly what they're trying to do in that area. Sure. To answer that question, I ask clients, what is your investment goal? What is your number one goal? Because depending on what your goal is, a different type of property in different locations is going to be a better fit for that. And what I mean by that is if you're looking for cash flow, you're better off looking for a three-bedroom or larger pool home just off the island on the mainland. You're looking for a lifestyle asset that's going to have high appreciation. Yes, DeKey, Ann and Maria Island, Indian Rocks Beach are better locations for that. Properties with higher land value are not going to be as good for tax benefits. So, again, you know, the barrier islands of CSN and Maria, Indian Rocks Beach aren't going to be the best play

11:31if you're looking for tax benefits. Something with the lower land value, higher improvement value, higher home value. Again, on the mainland, it's going to get your better tax benefits and better cash flow. So, it depends what your goal is on. Interesting. So, yeah, it just, it really is dependent on what you're trying to do. If you're just trying to have a great place to go visit on the beach and maybe cash flow is not your objective or taxes, you just want a place to maybe break even, maybe make a few bucks then you're looking at Ann and Maria Island or CS DeKey. But if you're, if this is truly an investment that you are looking for it to cash flow annually, you're probably looking at somewhere, what are those little areas on the mainland, like Bradenton, like you said? Absolutely. Sure, and then budget comes into play, of course, too. You know, the islands and then barrier islands are, which marks them. So, a lot of people listening might be familiar with like the Northwest Florida market where you have to be walking distance from the beach or else

12:31it's not going to work here. But when you scoot down to your market, it's okay to have to get in a car and drive to the beach. So, when you're buying in these mainland places, what's your typical guest avatar? Like, why are people coming there? Our traditional guest avatar is families. It's, you know, a family with a few kids, a couple families traveling together, a family with the in-laws. It's definitely younger children, you know, within those families. So, our general rule of thumb is you want to be within 15 minutes to the beach. And here's kind of why that works. If you picture yourself, you and your husband or, you know, you and your wife, you take in your young children to the beach, you're not going to be at the beach for eight hours a day. You're going to go there for a couple hours and then little Johnny's going to be hungry, little Christina's going to have to take a nap. Somebody's going to be running down the beach like a little crazy kid. And after three or four hours, mom and dad are going to be exhausted, tired, and

13:36wanted to go back to their beautiful Airbnb that has everything they need right there at the house. Everything to keep the kids entertained, to keep the kids safe, to where mom and dad can actually take a break and relax themselves. In addition, the further, or the closer you are to each, the further you are from the other reasons why people come to Braidings in Largo Seminole, such as the museums, the aquariums, amusement parks, and things like that. So, it's a little bit of a balancing act. And like I said, our general of thumb is if you're within a 15 minute car ride to the beach, you work totally fine. Good to know. So, a little more flexibility there. Absolutely. Thank you for listening. We sincerely hope that you find value in this podcast. We would love it if you would use our team to purchase your next vacation home. We sell houses in all of the best vacation markets in America. And we want to earn your business.

14:40Reach out to us anytime at the shorttermshop.com. STSconsultation.com. That's the shorttermshop.com. So, I want to take a minute to talk about a minuteization and and theming. So, that is becoming a popular strategy in your neck of the woods. Can you tell us? And you've done one. I would like to hear what you bought, what you did to it, about how much that roughly costs and what you're expecting to see or have seen in income on that. Sure. We bought a four bedroom in July of 2013. I'm sorry, 2023. We paid $6.34, put about a hundred into remodeling the interior. And we got it up and running before the end of the year, before the beginning of 2024,

15:43for tax purposes. But we didn't really do any improvements to the backyard or add a game room to the garage. For 2024, that property did about 95,000 throughout the year. We shut it down in September, depending on their September project and October. And we built out the backyard. And we added a game room in the garage. When I say built out the backyard, we added a pickleball core. We added a mini golf. We added a big playground for the kids. A bunch of artificial turf extended the patio. Okay. So, it's down the pool cage. You've basically made it like a little mini resort in the backyard. Hang on, see. Down the pool cage, you said. Yeah. Okay. So, that's something that I have a question on before you continue in South Florida. So,

16:43in Central and South Florida, a lot of pools have cages. So, you don't have to keep those, right? You can just take those down. You can take those down. You know, there's pool code requirements that you have to put in place as an alternative to the pool cage. You know, to keep kids safe to keep children from wandering and falling in the pool, which we obviously do. But the house's photograph much better with the pool cage removed. Right. If the photos don't look good, you're not going to get guests to the house. So, you know, again, taking down the pool cage is something that's pretty popular. It also allows a lot more free flow between the pool area and the stuff on the exterior of the pool, which is all these other amenities we're talking about. It makes them more cohesive space. Again, we'd be between, you know, all the stuff that you're putting in the backyard. So, in addition to the backyard, you know, we built out the garage, turned it into a game room.

17:44And what I mean by that is we didn't do anything super crazy, like you see in Orlando, at the semi-market. We just put some lighting in the ceiling, a mural on the wall, epoxy the floor, ping-pong table, pool table, you know, TV in there to watch a football game. Arcade games. Arcade games, stuff like that. But with those improvements, we went from, what I'd say, 95,000 on 2024. In 2025, that property did 217,000. Whoa, so back it up in 20, compare real quick, 2024 income versus 2025. 2024, we did 95, 2025, we did 217. Wow, that is a huge jump. And what did it cost to put all that stuff in? For the backyard and the game room, I spent probably around 100,000. So, that's really not bad at all in terms of cost versus the income that you

18:49had difference in income. Wow, that's amazing. Now, I mean, I tell people that's not normal, that's not average, but it is possible. That is a top-performing property, but it's definitely possible. And all those resources that we have to do, all these things that we do to our properties, you know, we share with our clients and guide them along the way to help them be successful. And I'd like to also add to that, you share those resources with your clients, and there are no hidden like you're getting 30% of what they spend with a contractor either. You're just recommending people who are good for the job. We give our clients our list of contractors who work on our houses. They pay the same price we pay. You know, we're not being any kind of middleman. We're like, you're peers or people. We may say, you know, send an introductory text to some, you know, say, Alex, my terrific guy, he meets someone, so my client, she's buying a house and

19:50looking for, you know, looking for some turf options, you know, can you help her out? But, you know, we are happy to do that because their success is our success. I always tell people, you know, and explain that we're not selling primary homes here. We're selling investment properties. You know, we want, we do everything that we can to help you be successful in the hopes that you'll come back and buy another one. That's a very straightforward and very transparent. And we can call that out because that's big in the, in the influencer world right now, is they influencers will, you'll pay them, you know, 25 grand to teach you how to do a short-term rental. And then they'll say, okay, I have everybody you need. And then they're getting a 25% referral fee from the real estate agent. They're getting a 25% referral fee from the loan officer. They're getting another 20 to 30% of whatever you spend on their contractor. So, and most, most students that are paying for this aren't aware that there's all of this extra kickback stuff and that they probably could have paid less if they did not use that recommendation.

20:54They're getting charged more because they're kicking back to the original recommender. And I just wanted to call out that you guys don't do that. The other thing is quality. You know, we, the people that we recommend, we know do quality work. Like, you know, again, we're very particular. I'm very particular with my engineering background. And engineer. I want to be sure that, you know, the people that we're recommending are going to do good work. They're not just going to, you know, do, do crappy work that they're going to have to redo or have problems with down the road. Yeah. Yeah. So I love that. Just, hey, we're just recommending the best person for the job. Hey, this person did a great job for me. Call them. And would you say that with all these, you know, games and amenities and stuff, does that do anything to make your maintenance more difficult? Like, is there more stuff to break or has it been pretty, pretty straightforward? If anything, there's less maintenance, you know, you don't have to know artificial turf.

21:54Oh, yeah. That is nice. With artificial turf, you don't have stuff blowing in the pool. You know, we usually take down any kind of big messi trees and put up, you know, nice, pretty palm trees, coconut palms, you know, self-cleaning royal palms. So honestly, the way we set them up, maintenance is significantly less. Yeah. I guess I didn't think about that. We've got one in Florida. If you guys are listening and trying to have a grass yard in Florida, just don't bother. It's too hard. You have to like, have a water at nighttime. And it's just, I'm not going to get into all the ins and outs of why. But we've got one that we have like hard skate rocks. And they're not gravel. They're pretty rocks. But still, if it gets, it was still get like, I wish it was grass. I'm like, yeah, you know, maybe we should look into this turf thing because you just can't have grass in Florida. But turf, maybe we should, should look into it. Got a good recommendation for me. I'm sure they won't come up here.

22:58All right. So we've got, you know, about 10 minutes left here. So what else do potential investors in your market need to know about that we haven't talked about yet? The biggest, the biggest mistake I see clients making that this probably goes for any market is designing the property to what they like and not what they're guests like. Yeah. This is what I prefer when I travel. Well, you're not the traveler that comes to this market. You know, and so we really just try to educate what the avatar is. You know, we see different types of people coming in different times. So, you know, we have like the snowbird people that are coming from the north, you know, for spring break travel. But our June and July's traveler is different. They're interstate traveler. They're driving, you know, they're bringing your pet. So, you know, allowing to have pets is a big thing here, you know, especially in the larger houses where

24:00you're getting 12 to 16 people, somebody out of those 16 people probably have a pet they want to bring. So, yeah, that's a big one. I mean, the last statistic I said I saw was about, you know, a third of travelers come with a pet. And like Christina said, the higher the guest count that you're going to sleep, the more likely it is that somebody will have a pet. So, if you're not pet friendly, then you know, you're excluding a large, large pool of guests. That is true. Have you had any horror stories with the pet friendly thing or no? No, you know, I mean, I can think of one time a dog kind of chewed on a windowsill or, you know, but that's really the worst of it. We don't see the horror stories down here. Again, we're hosting families. You know, this isn't a party town that there's not, you know, a bunch of underage kids out drinking and, you know, tearing the place up. We just, you know, in the nine years we've been doing this, you know, knock on wood, we haven't

25:04seen that. Yeah, I really haven't seen it across my portfolio either. We, I mean, we're not pet friendly, but we haven't really ever had anybody just damage things for the sake of it. We've had the occasional mishap, but, you know, no, just straight irresponsibility. Yeah, I mean, oh, you know, a kid might break a lamp or a glass might get dropped, but, you know, those are accidents. It's not, you know, mischievous, you know, deliver it, you know, issues. Yeah, awesome. So if a new investor is listening to this and they're like, you know, maybe I'm going to, they're listening, they're opening up their Zillow in the background. What would be your recommendation other than to call the short term shop and ask for John and Christina? What would be your recommendation in terms of just doing a little research, kicking it around on Zillow, where are we looking? What sizes are we looking at? Sure. So as far as size goes, you know, you definitely want three bedrooms or larger.

26:06Below three bedrooms, it's very difficult to cash flow. You have a three bedroom house that's got a nice backyard. You can do very well. You know, we have a three bedroom in our portfolio that did 159,000 last year. Wow. Again, you know, it's a top performer, but, you know, those numbers are achieving. So one thing you definitely want to steer clear of is anything with a mandatory each away. Because in our neck of the woods, mandatory HOAs do not allow short term rentals. If it's an optional HOA, that's totally fine. I've never heard of that. So an optional HOA would either be an HOA that expired many years ago, because they have to be renewed every 30 years, or an optional HOA would be basically, if you pay the $30 a year, you get to come to the Christmas dinner, you know, those types of things. So yeah, some of the optional HOAs, you know, it's like, you can contribute $12 a month to pay for the landscaping of the entrance, you know, to the

27:10neaprotors or something like that. But it's voluntary things. It's not something where they can mandate what you do, such as regulating short term rentals. As far as locations in Braydenton, you know, 34209, 34210 or popular curve codes, when you get up to Orgo and Seminole, there's the process a number of zip codes. But just the city of Orgo, the city of Seminole, up in Pinellas County, are there, you know, very good performing locations up there. Sarasota is a little bit tricky. That's not your standard cash on investment, because the majority of Sarasota is not short term rental friendly with the 39 minimum stay restriction. The city of Sarasota, which includes kind of like the downtown area, the northern tip of St. Norman, so you don't keep those have a seven night minimum stay restriction. But again, those types of locations would be a different type of investment goal. So again, majority of people looking for cash flow

28:16or tax benefits, looking in in Braydenton, Seminole and to city of Orgo. All right, good to know. So now we're to the very fun last three questions of the show that we ask every single guest. Are you ready? Let's do it. Okay, first question. What advice would you give 20-year-old John and Christina if you knew then what you know now? Oh, man. So yeah, one of the things for us, you know, before we had Little John was we bought a property and moved into it. You know, that's probably not the situation with the buyers that we get here. But we really did start our first investment with us living in it and doing everything ourselves. How's that? My advice would be to start yesterday. You know, if we had started sooner, we would obviously be better than we are today. But we learned along the way. We learned that single family long terms

29:17don't really work. And we've really got the short term thing dialed in. So all the trigger that started. Yeah, and find somebody that you can trust that, you know, that does have the backing of the short term shop and all the education that they bring. You know, and learn that way. Learn from other people some states. Yeah. All right, now I'm kind of along the same lines. What advice would you give a new investor who's looking to get started in short term rentals today? I always tell my clients, you know, market to be prepared, but be patient. And what I mean by that is that your finance is in order of your pre-approval letter and also start analyzing properties now. Don't wait until, you know, there's a property that you're interested in on the market to kind of start working your numbers. Analyze properties that are on the market now and understand why they don't work. Learner understand. Analyze properties that have sold to understand why that

30:18might have been a good deal that I let pass. But get your reps and get your experience, you know, get comfortable analyzing your numbers that way when the right property does come up or, you know, you are in a financial position to where you have enough money saved up to move forward. You're comfortable doing so. Yeah, I think another big thing is don't get to hung up on someone else's numbers. You know, sometimes we'll see low performing short-term rentals come on the market for sale and they're like, oh, no, we did this much. Like, yes, but here's the listing. Look at the photos. Look at all these things. Here's five things that I can think of right off the bat that's going to be able to help perform those numbers that they did. So we talked a lot about that too. That's such a great one. And that that's one that is really a hard habit to break for new investors. Because I mean, I talked to a guy two, three weeks ago, I had coffee with him and he owns like 20 dental practices is looking at, you know, 20 million dollar pieces of land and stuff. Very experienced. And he will not even discuss a property where the rental history is not what he

31:27wants it to be. And that's just so short-sighted because rental history does not give you any context. It's just one data point. And you don't know, well, is this history underperforming? Is it about on par? Is it overperforming? Is it something I'm never going to be able to do? And you don't know that until you look at other similar properties and see what they're doing or look at the listing itself and see, hey, okay, are the photos blurry? Is the house in disrepair and looks bad on in pictures? You know, any number of things are they? Do they have a high? This is a big one that I see all the time that people miss. Do they have like a five-night minimum night stay or seven-night minimum night stay? That'll mess up rental history every time, dynamic pricing or even, you know, looking at who's managing it? That makes a big deal. If it's one of these big, huge managers that have hundreds or thousands of properties, those guys don't their business model is not to optimize each property and get the highest price per night. Their business model is to get a bunch of low-price

32:29bookings across thousands of properties and then take 20%. So all of those properties, if you look at them individually, are not performing well. And that's just what their business model is. So that's such a huge one. And now I've taken over your answer to your question. But that is such a huge one is just don't just look at rental history and pass. Like look at the context, look at comps of other properties. That they can go the other way too. I mean, I don't like looking at rental history at all because just because a property is doing well, you could come in and take that property. Totally. Yes, good. So just like it, you know, it could be underperforming, you can come in and make it a top performer. You know, what's happened in the past doesn't dictate the future. Correct. Yeah, it can go either direction on that context piece. All right, last question. What is your favorite book that's impacted your mindset? Just need to do you have one? I do. I mean, the first one that always comes to mind is who not how, but that's a good one. That is a good one. Great. There was another one that someone had

33:34mentioned yesterday. And it was, would you rather read this book or this one? I don't remember what those two were, but they were both really good books. That's a tough one. I don't know. But, you know, Napoleon Hill level got her to my favorite authors that I really like to read. All right. Cool. Napoleon Hill was that Thinking Grow Rich? That's one of the bigger ones. Thinking Grow Rich, I really like outwitting the devil. I don't know that one. All right, outwitting the devil. I will check that out. Well, guys, if our audience wants to find you, follow you, work with you to buy property in Braydenton, Sarasota, CSDK, Amelia Island, any of these places? How can they do that? Obviously, they can reach out to us through the short term shop. I believe the email is agents of the shorttermshop.com. Is that correct? Agents at the shorttermshop.com and say you want to buy in in Braydenton or Sarasota area and you'll get John and Christina.

34:39We are always here and happy to help. All right. Well, thank you guys so much for coming on. And audience, we will talk to you or to guess not talk to you. Audience, we'll see you next week.