Customer type: Real Estate Consultant
Property Type: Short-Term Rental
Region: North America South America
Products: Dynamic Pricing
Number of listings: 5-25
PMS: Smartbnb
Very early into his short-term rental journey, Jonathan Farber realized that his pricing strategy lacked sophistication causing him to lose money because he was
- Pricing his properties too low across stay lengths
- Not taking into account weekdays vs weekends, high vs. low season pricing
- Inconsistent in adapting his calendar and pricing during local events
- Largely guessing what the right price for his property was
About Jonathan Farber
Jonathan Farber’s tryst with real estate began through a strategy called househacking, where he rented out the rooms in the home he was living in, thus living for free, making money, enjoying tax benefits, enjoying property appreciation and not having to trade in time for money.
Jon achieved financial freedom by age 27, leaving his corporate job to focus on real estate investment and rentals with creative acquisition and financing strategies. What started as a side hustle for him nearly 7 years ago, is today a full-time real estate investor role.
His podcast – Millennial Millionaires Through Real Estate helps young real estate investors achieve financial freedom through creative strategies.
Before PriceLabs
Pricing was largely based on guesswork
Challenge 1: The team lacked an adaptive calendar
Jon’s properties are in areas where there are a lot of events that happen from time-to-time. Having to manually update and keep track of the calendar involved significant time and effort that still left room for error, misses and inaccurate pricing.
Challenge 2: They were pricing too low across stay lengths
Their pricing strategy lacked sophistication and didn’t take into consideration
- Weekdays versus weekend pricing
- High season versus low season pricing
- Events happening in the area
- Different bundle pricing
- And more…
This led them to price too low across bulk dates instead of pricing according to local events and availability or lack of availability of other properties. It was then that they started weighing in on options – different ways in which they could have better pricing, for their properties to stay competitive, occupied and make a profit.
“We’re in an area where we have a lot of events going on from time-to-time and we realized quickly that using just Airbnb or just VRBO for pricing – it wasn’t accurate. We were losing money by not being able to have a calendar that would update without us thinking about it. We did a demo of PriceLabs, sent it around the team and it became the winner of the ones we were considering, and now we use it for all the properties today.”
– Jonathan Farber, Airbnb owner & host
Choosing PriceLabs
Jon Farber and his team were recommended a couple of tools and after their demo with PriceLabs they found it easy-to-use, with multiple features and customisations to suit their requirements.
Once they made their decision on PriceLabs as their dynamic pricing tool, they turned to groups that they were part of for feedback about it. Many of the people they respected used PriceLabs successfully making the decision that much easier.
After PriceLabs
PriceLabs has provided a convenience and organization to the business process that he didn’t have before. Without it managing pricing was complicated and difficult to manage. Jon felt like he was leaving money on the table.
With PriceLabs, he is able to be better organized and have a better handle on his margins, rather than undercutting the market with occupancy but at a price that was too low. That feeling of ‘losing money’ is no longer there with PriceLabs.
PriceLabs Best Practices from Jon Farber
- Set up is the most important part. Spend time on this. If you set it up properly you don’t need much adjustments.
- Reach out to PriceLabs Support and attend PriceLabs trainings to ensure your properties are set up correctly.
- Manage variances to ensure your price is right for both occupancy and margins
- Pay special attention to optimize slow season pricing to stay occupied and make a profit
