You’re listening to Your Happy Place Podcast. Each week we will be bringing you interviews with real estate experts and investors. The show features interviews and discussions on real estate investing, property management and inspiration. With your host Jenna Ross.
Jenna: Today on the podcast we have Jordan Hipson CEO of OverSea. Welcome Jordan.
Jordan: Thank you for having me.
Jenna: Jordan, Can you tell us how you got started initially into property management?
Jordan: Absolutely. I am twenty five years old now. I started this business when I was twenty so five years ago. The way this business got started sort of by fluke. I was working full time as an insurance broker which was in the family genes my entire family is deeply rooted in the insurance and I wanted something else to supplement my income. I had a friend who was a developer sort of on a smaller scale of residential developer and he had built a little portfolio of properties and was starting to require some assistance with the property management. So it became a part time job. I actually basically traded an apartment for helping him with administration side of owning rental properties. Signing leases and dealing with phone calls, just the ins and outs of running properties every day.
After about six months of doing that I decided to eventually start trying to finding more people that I could do this for and slowly built it as a business from there.
Jenna: That is so cool and so amazing that you got started at the age that you did and that what you have done with the business is so incredible.
Jordan: Thank you. I think that as you know starting a business is definitely not easy. I think one of the big benefits of starting so young is that I had the energy to put in those fifteen hour days every day of the week to build up the foundation of my business.
Jenna: Yes. You have switched your focus it seems more to the vacation rentals in the past years. How did that shift come about?
Jordan: It’s interesting, a lot of people will call it a shift, I was just talking to a client yesterday who’s also a long term rental client actually who said that it seems like we changed our focus as well and it’s interesting I think that just shows how really intense the short term rental market is.
Realistically buy number of doors we have just as many long term rentals properties as we do short term rental properties but it’s those short term rental properties that really command so much of our attention. The long term rental properties are really systematic. We got our system down and they certainly do require quite a bit of attention but just by nature the short term rental management industry adds hot vitality in property management and so there for it has really changed the dynamics of our business and it has propelled our business. It has been a big part of our growth by adding short term rental space. And it is also what we put on social media quite a bit because we could just share pictures of empty apartments all the time but that doesn’t really get us to where we have gotten with our art medial effort. Those pretty oceanfront homes definitely helps with the views and the likes and all that stuff.
Jenna: Your marketing is exceptional as well. Can you walk us through, one of the things that I realized the one time that I did a vacation rental and I had your company come in and clean in between the bookings which was so helpful and I realized quickly how labour intensive it is, how active it is kinda like how you explained it takes a lot of time and energy and I was so lucky to have access to you guys with the experience that you had. Can you walk us through how you manage the different companies that you receive booking for?
Jordan: It’s a big tangled web of technology. And for us scaling our business to the point of being able to accommodate hundreds of reservations a month really required really intensive knowledge of how all this technology works. I find that actually becomes a big part of my roll as the CEO of OverSea is really making sure that the
technology that we use is effective and enables our team to focus on providing that hospitality rather than coordinating those details.
Everything from the way we receive reservations from the different online travel agencies like Airbnb, booking.com and how we schedule our housekeeping team and how we communicate with our guests you know at the foundation of all of that is like I said a tangle web of technology the enables us to do what we do
Jenna: That is so neat. Where do you typically see the majority or a big chunk of your guess coming in to Nova Scotia from?
Jordan: On the short term rental side, in 2019 we had about 65% of our bookings come from Atlantic Canada. The rubber tire market as we call it is definitely a good number for what we are kinda dealing with right now. We know our provinces won’t be as opened this year. The remainder is split between Ontario and other pars of Canada. A lot of Ontarians come down to the east coast and discover Nova Scotia for the first time through vacation rentals which we think is awesome. We also get a big chunk of our guests, or we did in 2019 at least, from Europe as well as the United States. We found that the Europeans and US guest gravitated towards our higher end products. I think that is just the nature of their exchange rate helps them to do that. But it was really cool to see or continues to be and will be again in the future how many people really love our region and are interested in exploring Nova Scotia and Atlantic Canada through this business, it’s too cool.
Jenna: It is really neat and certainly people, when I have travelled abroad, people here Nova Scotia they just it’s sort of that iconic place that they want to go to that they haven’t explored. It is such a beautiful province.
Jordan: Definitely and in a weird way, the Trump election in 2016 there was this big marketing thing about moving to Cape Breton and it was a joke but it actually did a lot for Cape Breton as well as the rest of Nova Scotia. I think even for Canadians, you know you see a picture of the highlands and you say like WOW I didn’t even realize that was in my own province and those experiences happen in all for corners of the province.
Jenna: And where are you from originally Jordan?
Jordan: Born and raised in Halifax.
Jenna: I didn’t realize that I was just curious about that. Can you describe how manage the cleaning for the vacation rentals?
Jordan: For sure. Like I said, there are a few different parts when it comes to house keeping. I will also say as a growing business, house keeping is so different from somebody who has one listing.
If you have only one vacation rental property it’s usually pretty easy. What I recommend is connecting your calendar through the availability section of Airbnb to your google calendar. That is the easiest way to manage it. Now if you are like us and have sixty vacation rentals that is going to look a lot different and it’s probably going to require a little bit of technology to enable you in the back end. Scheduling is definitely one of the critical parts of housekeeping because the last thing you want is for your guest to arrive to an unclean space. You have to keep in mind that the first few minutes when somebody checks in is usually when they are the most stressed, think about yourself when you travel, your first arriving to your destination that feeling of ahh ok we are here and so if you arrive to a space that isn’t clean your’re not going to have that at all. So I can’t stress enough to make sure you keep your schedule on track but also make sure that you have your listings set up in a way that it’s manageable that that schedule is manageable for you. If you do not want to be cleaning every day of the week in the summer then you might want to avoid one night stays. You may want to try for a 5 night stay.
Now the flip side and where things really get complicated is the actual housekeeping itself, actually cleaning the unit. I have a really easy rule and that is no surface is to be missed. I try to explain this to people that by no surface is missed is if I am cleaning my sweater I am cleaning the inside, the outside, the zipper, the underneath of the zipper, the collar, I am cleaning everything I am touching every surface. If you are cleaning a table I am cleaning the underside of it because a guest will find something grimy under there and will think” oh gosh what else did they miss”. Having a checklist critical, very important and if you are working with an outside cleaner and you are not cleaning it yourself, which is pretty impossible especially as you scale that training period is so important. You want to work with that person at least three times. You need to get your hands dirty get use to the space so that you can clearly show them what you expect this space to look like. If you are not willing to get dirty and do it yourself you are never going to be able to set that example properly for people. For the first two years I was the cleaner for the first year and even into the second year. Even now we have days that the schedule does not work and I have to jump in and help out. It is pretty few and far between thankfully for my sanity now days but you never know I may have to jump in. I actually enjoy it. It’s a nice escape from being behind the computer all day.
Jenna: It’s hard work and very important work. Cleaning is everything. Jordan: It really is. Actually it’s interesting to see Airbnb is actually coming out with a prescribe protocol. It’s rolled out in the United States now, it started May 1, we haven’t received details yet but there will be a prescribed protocol, probably an online training component all hosts would have to complete and potentially even prescribed cleaning products a specific product that they want hosts to use. They will be the first online travel agency to set and standard for housekeeping. I actually think it’s fantastic, it’s going to show people upfront this is what it takes to clean a short term rental property. It is not like cleaning your house for yourself. It’s like cleaning a hotel room that’s the big differentiator is that clean and tidy isn’t good enough you need disinfectant, sanitized tidy to the extreme.
Jenna: I think that is great because I know my family and I tend to stay at Airbnb rentals or vacation rentals when we travel away and it’s just nice to feel comfortable that it is up to hotel standards so I think that would be the only way to really ensure that so and a lot of times you are paying for a cleaning fee with your booking so you want it clean.
Jordan: For sure and that is really one the most challenging and under rated part of the business is that you do have to be able to offer that hotel quality clean but more so you need to understand what that means. So if you haven’t travelled in awhile and you are going to throw your space on the short rental market, get out there. Try some other properties, go to a nice hotel and really just understand what that means. We learned this from years and years of many failures but what we built is sort of a guide line that we use internally that when we share with new hosts they just kinda say, these are things we never thought of. When in management that is in a beast in it’s own. There is nothing more frustrating than pulling a load of towels out of the dryer and having to discard three of them because they have a black stain the size of a fleck of dust on them but you don’t want to get out of the shower and flip open your nice white towel and find any stains. You are going to start again to question how clean is this, did they bleach it? I hope this is safe especially now a days.
Jenna: Yes, it’s more important now. People are even more paranoid of all of that. Can you tell us about the VRMA Vacation Rental Conference that you attend?
Jordan: I think that if you are someone who is a new host is intrigued by the industry and you want to learn more and you want to build a business that is similar to mine or you want to build your own vacation rental business that you own the properties and want to manage them yourself I highly recommend attending a VRMA conference. They are online now, they do their spring form which typically would have been in Chicago this year but it’s being held online. It’s a great opportunity to attend at a highly reduced cost not having to pay for travel.
So basically what the VRMA International Conference is, is an annual conference put on by the Vacation Rental Managers Association which is an international association of vacation rental managers. Last years conference was held in New Orleans,typically held in the southern United States because it is a sunny destination so it attracts people. We had over 2000 delegates at the conference in 2019 from 20 countries. People are coming from as far as Australia, New Zealand. So you get a really cool in depth and global understanding of the vacation rental industry. Typically 3-5 day and you have different content classes and sessions available through out the day. I highly recommend it. I have met some colleagues in the vacation rental world that I keep in touch with on a regular basis. These are people I know I can call up and say “Ok, What the heck is going on, how do we deal with this? And it’s just nice in any industry to put your head together with like minded people and collaborate on strategies to deal with the challenges of your industry.
Jenna: That sounds awesome and it is so great that you care about the professionalism of what you are offering enough to go and learn more and improve every year, it’s wonderful.
Jordan: Absolutely. Especially if you are newer to the industry. Once you go once I can almost guarantee you are going to continue to go. It makes it pretty easy that is always in a pretty cool spot as well. One of the other aspects is the exhibition hall where you are going to have hundreds of vendors. You can have face time with companies like Airbnb and Booking.com. You are getting flags from those companies and you are getting the opportunity to play around with some of these different software products that aren’t available to our industry. We spend a lot of money on software in our business. It’s a wild amount. About 2% of our management fees roughly is put back into the software that we use for short term rental space and selecting that software is a heck a lot easier when you are their face to face with people and you can really understand their program and what they have to offer when you are comparing it against twenty options that are out there.
Jenna: Can you tell us where you have about sixty vacation rentals that are short rentals in Nova Scotia. Can you tell us about two that you would suggest are the most popular for bookings?
Jordan: We look at our properties in three seperate tiers. This is a system that basically allows our guests to select the property that is most suitable to them. The first tier which is our essential tier. These are typically going to be urban properties like single family homes or condos that are in really convenient locations, it could also be a cottage.
We have our minimal standard of course but these properties may lack amenities like parking or air conditioning. They are standard fares. They are comparable to hotel rooms.
The next tier is our lux properties and these are just a step above. Still urban properties like condos or single family homes but these properties offer you amenities like air conditioning, parking. They typically have a bit more of a sense of style, the amenities offered are a little bit higher end, the finishes maybe a little more luxurious. And then we have our top tier which is the signature. These are properties that are super high end. One of a kind. They are typically at a price point of $600.00 a night upwards as high as, we have some that are upwards to $2000.00 a night. These really are a one of a kind property.
When you are investing in a short term rental property, I am going to kind of answer your question as if I was an investor looking to purchase my first vacation rental cause I think that is the root of the question. Really what is available to you and what you can purchase is going to determine the return that you get and the level of return you get. If you have a small 500 sq ft condo downtown your clearly are not even going to come close as if you buy an oceanfront vacation rental property. Our top performing properties are going to be studio and one bedroom downtown as well as oceanfront cottages are essential lines. They are going to be properties that are accessible and price range of most people so there for you are going to see your highest occupancy throughout the year. The cost of acquisition is usually its going to get you a better cap rate basically in those two different property types. The reason I find studio and one bedrooms are typically more successful is that in the off season we see more business travel there for we find the two and three bedrooms in the urban area may have to be priced similar to a one bedroom in order to get the booking but the cost of acquisition for one of those units is often higher. You can definitely make money with any property and I think that is the cool part of this industry. People have trailers and yurts and all different types of property on the short term rental market but those are the ones we find are the most successful.
Jenna: Excellent .You certainly have a variety of beautiful properties and I just love your oceanfront ones that you have. They’re stunning.
Jordan: Absolutely those definitely are the getaways. I think that with everything going on right now with the pandemic that what we will see is Nova Scotians will want to travel within Nova Scotia and so today if I was buying a short term rental I would be going toward that waterfront cottage staycation experience. We are totally anticipating a surge in those type of properties.
Jenna: For sure. Can you share with us how your company is managing through the COVID 19 pandemic?
Jordan: We are just blessed I think to still be here today. I know there are a lot of companies in the travel world that are struggling big time, both big and small. We are navigating through in a few ways. We are diversified in our lines of business which helps. We are not fully relying on the short term rental world to get us through. The performance that we are seeing in the short term rental space is really grim right now. We anticipated internally our forecasting expected us to have roughly two hundred and seventy checkins in April and we had about forty. In May we are expecting three hundred and sixty and right now we have about twenty. The numbers are down big time in the short term rental space. A lot of our properties had to pivot either temporarily or permanently to long term rental. That is just the decision our clients have made. They are individually making those decisions based on the information we provide them.
The biggest challenge that I mentioned in a video that I put out called Thriving as a Landlord in a Pandemic is the uncertainty in the short term rental space. A lot of our clients are in a position where they can a month or two with no revenues but as we expect to go into 3 months, 4 months and 5 months, we are losing our summer season and suddenly the outlook is not so great for the short term rental space. We are going to be a different business when we come out of this but it is definitely inspiring a bunch of creativity inside our organization and the government assistance has definitely been helpful albeit confusing. I think if you are a restaurant business owner out there and you haven’t even spent an hour doing research do it as there is help out there available.
Jenna: Yes it has been great that the government has kicked in help and it seems to me from things I have read that Airbnb in particular has offered some assistance for the reduction in bookings. Can you speak to that?
Jordan: Airbnb is definitely the dominant online travel agency. They are the ones with very deep pockets. They have a lot to spend in marketing. It has been an evolving situation with Airbnb but what they came out and said is that cancellations will be penalty free both on hosts and guests. They created a very challenging environment for hosts who suddenly are losing reservations left, right and centre with absolutely nothing to fall back on. One of the challenges that we have as hosts, this doesn’t apply to Airbnb but for all other platforms is that are the merchant of record, we have to process the credit card payments internally and so when we accept a payment for a reservation that might be in June and then we have to refund that payment there is often fees associated with that. We are still charged banking fees, credit card processing fees etc. and when the cancellations add up the way they have been it can become quite challenging. You see cancellation fees left,right and centre. So Airbnb addressed their cancellation policy by saying they will be paying out 25% of all reservations that were cancelled due to the pandemic to host. We haven’t seen that come through yet but they made these promises.
They have also made a lot of programs available to front end workers helping them safe, secure housing which also benefits the host. Here on the east coast things are always a it different. The programs put out by these big companies like Airbnb aren’t always as helpful for us or maybe aren’t known about enough that their reach doesn’t become as effective. But it is nice to see companies like Airbnb step up especially when their counterparts aren’t really doing much at all. Airbnb is also suffering big time. We are in this together.
Jenna: For sure. As you have mentioned the essential workers, have you seen some essential workers booking some of your rentals?
Jordan: We have for sure. Not a notable number of reservations or anything along those lines. What we actually saw a lot of especially in March and April were university students who were asked to leave their residences and didn’t really have a place to go as well as people coming into the province that needed self isolate and had no where to go. Whether it was a working mother coming back to NS therefor having to isolate but wanting to stay away from her family or people moving to NS and had to isolate or whatever the situation may be we saw a sudden jump in fourteen nights reservations. The remaining reservations have been those. Any leisure related not really happening any more.
Jenna: I feel like just thinking of my family in particular we just can’t wait to go book a cottage or something down on either of the shores and just have a staycation and just be outside of our four walls that we have been stuck in for eight weeks together. Looking forward to that and I feel like a lot of other families feeling the same way.
Jordan: Absolutely. It is a huge opportunity for the short term rental industry and those hosts who are hurting right now. I have spoken to a lot of hosts and everyone is suffering. May is really when things kick back in to gear for us. I am usually spending my May driving nonstop from property to property,meeting owners,preparing, getting things ready. This is a whole different experience for us but like you said this is an opportunity for the host to perfect their product. Make sure their property is really stand out and impeccable and perfect their cleaning process as well to make sure they can address the need of a post pandemic travel environment. There will be a lot of families are hoping to get out and see their province.
We have seen some real awesome feedback on social media of people just saying “oh it’s so nice to see your update see those oceanfront homes and just dream of exploring our own province” just something we haven’t done that much of. This is the year to do that and this applies to host and travelers. Get out there, see your home province everyone needs your support right now and this is totally the time to do that.
Jenna: Yes and a nice opportunity to support the small businesses along the way. The little knick knack, antique shops, and the restaurants it will be nice.
Jordan: Go to a part of the province that you normally wouldn’t think to visit and you will discover so many cool things and such amazing communities. It’s going to look different this year, we know that but it is an opportunity to get out there. Realistically I think what we are going to see a lot of is booking a cottage, getting all the things you need for the weekend and sort of spending your weekend at the cottage and spending a lot of time there. Find ways to incorporate those local vendors because they are also going to be suffering this year due to a lack of travelling. I am thinking of the vegetable stands in Hubbards, the coffee shop in Chester or the restaurants in Wolfville. Whatever it may be find a way to incorporate that into your stay. Don’t just go to you know Sobeys, grab your stuff and go to the cottage. Find a way to build out the local experience and that’s a tip to the host as well. There is money involved in adding additional services whether you put together a basket of local and charge a bit of a margin on that for your time or whatever it might be. We are investing our time in to just perfecting our offering and finding new ways to generate new revenues. Our hosts and host through out NS are not prepared to just take a big hit contrary to popular belief not everybody who owns an airbnb is a multi millionares. There are several of our clients who are using this as a way to improve their property or a way to keep a family homestead in their family and to support that second property and that rings true for so many hosts in through out NS especially in the rural areas. I am expecting a surge and still think it’s a great time to be involved in short term rentals whether you are a guest or a host.
Jenna: That is so much great advice you just shared. Can you tell us what is your favorite part about being involved with vacation rentals?
Jordan: It’s easy for me, it’s providing hospitality to people. I love real estate and that is what got me into property management. My real passion is showing people new things especially when it’s showing them my beautiful province. I love NS. I love Canada and being able to incorporate my love of real estate with my love of showing people this amazing country. Just providing that hospitality and guest experiences is what makes this so cool for me.
Jenna: It’s certainly wonderful the province and to see your eyes light up when you explain that is so nice. I have one final question that I would like to ask you is, Where is your happy place?
Jordan: I think that is a very fitting question. My happy place is anywhere by the water with my family and my fur babies. The best part of this, like I said I am usually driving around which means I get to see so many amazing parts of this province. This morning I went for a walk across the street and sat on a rock by the water and sort of took it in with my dogs for an hour. That is my happy place. Any where near salt water particularly the Atlantic Ocean I am feeling good.
Jenna: I love that. Can you tell our listeners where they can find out more about OverSea.
Jordan: A little shameless plug I love to tell people to check out my personal website which is jordanhipson.com and from there you can link out to all the different endeavors and project I am working on. I also post blog post on there and share my U tube videos there. Check that out and of course Oversea is just oversea.ca It’s a pun word oversea.ca.
Jenna: Thank you so much Jordan for coming on the podcast.
Jordan: Awesome. Thank you so much for having me Jenna.
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- Episode 1 Podcast with Jenna Ross
- Episode 2 Podcast with Greg and Amanda on Real Estate Investing
- Episode 3 Podcast with Tony LeBlanc from Doorpreneur
- Episode 4 – Scott Gannon from MGM Wealth
- Episode 5 – Daniel St-Jean discusses “Rent to Owns”
- Episode 6 – Jordan Hipson on Vacation Rentals
- Episode 7 Podcast with Landlord by Design Mike Currie
- Episode 8 – Real Estate Investor Juleanna Freeman
- Episode 9 – Pilot Dimitri Neonakis and his Uplifting flights!
- Episode 10 – Real Estate Investor Mike Burgess
- Episode 11 – Interview with Sunil Tulsiani
- Episode 12 – Let’s talk private financing with Marty Crouse
- Episode 13 – Investor Sean Kearney shares his journey with us