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Episode 064 - Interview with Napa Valley Chris (Young) on His $6k Airbnb Settlement - Part One



Part One of our interview with Napa Valley Chris, Christopher Young.

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Show Transcript

[00:01] Over the last two centuries, nearly 90 percent of the world's millionaires have created their wealth through real estate. Here to tell you how you can ride this wave with less risk and less capital while creating greater income, is your host, best selling author and Speaker, Michelle Russell.

[00:21] Hi, this is Michelle, the Master of Money Mindset, and you are listening to the Short Term Rental Revenue Podcast...

and in today's episode, we're going to be talking to Napa Valley. Chris, if you don't know who Napa Valley Chris's, Christopher Young, he is amazing. I've become quite a fan of his through some of the Facebook groups that were on together. I was up late one night and noticed that Chris had posted soon after the shooting at the BNB in California. Chris, his properties are up in Napa Valley and Chris had posted that one of his properties had been robbed, so he had a bunch of damage done to his property. It looked like there was some kind of criminal ring there and drug use that had gone on, but they had stolen television sets, the washer and dryer, I mean it was absolutely crazy and miraculously Airbnb had covered that damage rather quickly.

Speaker 2: (01:18)
I mean he had a $6,000 check coming to him, like what seemed to be right away. I mean it's only in November 10th when this drops, so Holy cow. I mean that's absolutely incredible to have something in less than two weeks being taken care of like that. But a phone call did Chris and a little bit of conversation, he and I were talking about the circumstances of the terrible shooting that took place at the Airbnb there in California and his place on those very same nights. Something I happened and Airbnb had not done their due diligence, so they called it a high risk reservation. Those are reservations that you take when somebody lives in your same town, right? We, we've talked about that. We've said that's a high risk situation. Why do they want to stay there? But in Northern California right now, there's a lot of fires going on.

Speaker 2: (02:15)
So people are telling people that they need to stay there because of a fire. But around the holiday, obviously around Halloween is a big party time. So if they only wanted to stay one night, what would the dealio be? Right? So those are high risk reservations. Taking somebody from in town, taking somebody for a very short amount of time, especially on a date, a holiday or a party day, right? So 4th of July, new years Eve, a Halloween, those are big party days. And like I said, taking only one night on a party day with somebody from in town. So those are big red flags, things that we have to look for. And Airbnb should have noticed because the people who ripped Chris off, they actually had three bad reviews on them and each of them talked about theft and drug use and or drug use. And they should have been taken out of the system immediately.

Speaker 2: (03:17)
But they weren't for some reason they went through on the automatic booking, which it shouldn't have done. And there were a lot of things that had happened and so basically Airbnb was just trying to do damage control, but we're going to talk about the rest of the story with Chris. We're gonna let him go over that with you first really quick. I wanted to remind you that our show today is brought to you by audible. You can get your first audio book for free by going to audible forward slash S T R revenue. That's audible, forward slash S T R revenue to get your first audio book for free and a 30 day trial on the audible membership with the app and it's a really great way to get your reading in. Guys, I'm telling you all the time, readers and leaders, you can listen to a book every single week.

Speaker 2: (04:11)
I know as we get older, people are like, Oh, I don't want to read anymore. Reading is imperative to keep up with all the things that are going on today and you can listen to a book anywhere so you can listen to a book while you're in the shower while you're cooking breakfast. While you're doing yard work, while you're driving to and from a place, wherever you are, you can listen to a book and you can be like me and listened to them really fast because who's got time to listen to them slow, right? Especially when the books are eight hours or 10 hours long. Let's shorten it up and two times this beaten, cut that time in half and listen to those books, but there's so much you can learn. So please go to audible and use our link audible forward slash S T our revenue.

Speaker 2: (04:57)
So let's begin here with a quick introduction to Chris. He's an amazing guy. You guys are going to love him. We're gonna have a bunch of links for this interview so that you can go to Chris's page, get to know him. He doesn't have any courses or anything yet, but the man is just full of wisdom and wit and he's hilariously funny and quite entertaining. I have to tell you, it was, it was quite a fun conversation. So we're going to split that conversation into three different parts it looks like because it did go quite long, but there was a lot of valuable information in there. So we're going to split that into three and we hope you will enjoy them. Here's the first part of that interview with Chris young, Napa Valley. Chris go. All right. So if you like to give us a background of who you are, where you got started, how you got into the short term rental game, how far back do you to go? I mean we want

Speaker 3: (05:58)
to go go all the way back to st Louis. Go back to st Louis. Okay. So where your roots are. Okay. So my business partner, Mike and I are both from st Louis. We grew up together and um, uh, Mike was involved in real estate back in st Louis and ended up moving out here in 2005. I was in the repossession business in st Louis for about 20 years. Repossession and towing, um, owned a repossession agency, sold it in Oh eight. Um, stayed on with a company that bought a total 11. They came in one day, let me go. And I found myself, you know, kind of looking for something to do. So I ended up more in the towing space and doing some consulting work. And then in 2015, my business partner buys a car in Chicago out of the blue. And mind you, I'm not even on social media at that time.

Speaker 3: (06:52)
And he puts this thing out on Facebook and he says, Hey, I bought this car in Chicago. You know, if somebody's interested in driving out to me and my, I've got a twin sister and she hits him up, she's like, Hey, why don't you contact Chris? You know, I'm sure he'd do it. So Mike calls me and he's like, Hey, you know, I bought this car in Chicago, you know, would you be interested in driving in and out? I'm like, ah, yeah, I'll do that. And you know, I fly up to Chicago and I drive it back and, um, you know, drive it out here to California super bowl weekend of 2015. And Mike and I just, you know, we're catching up. We haven't seen each other in a long time. We're catching up and Mike has this ideas like, Hey, what, what do you think about flipping houses?

Speaker 3: (07:32)
I'm like, well, fuck, I don't think we know anything about it, but I'm sure we can figure it out. And at the time, Mike was selling a lot of real estate to real estate developers and he's like, I have to, I think we could do this. Like, well, you know, and we just, we talked about it over the weekend, you know, I think I burned it in town like four o'clock on a Friday. I was catching a red eye out Sunday. We're going to watch Superbowl. He was gonna run me to the airport and I was going to fly home. So we talked about it the whole weekend. And um, you know, I was like, let me think about this. Went home or, you know, we talked about all the way down to SFO flew out. I got home the next day. Or actually no, when I walked in the airport, I called them, we talked about it some more and it became more and more evident that we are both kind of serious about this.

Speaker 3: (08:18)
And um, I think I gave him like a couple days and I said, okay. I said, you know, this is in like mid February. I'm like, what do you think about me being out there? I'd like March 15th. He's like a what year? I'm like, this year, like six weeks. And he's like, well shit. He's like, you think you can get out of here that fast lane. I'm not really doing a whole hell of a lot here so I can probably do it. And you know, I talked to my family about it, told them I was doing called the girl who used to take care of my dog and said, here, I need you to move in my house live here. I'll pay all the expenses if the roof caves in call. Other than that, I don't want to hear shit and I'm going to California. If I, uh, if I got to come back, you're gonna have to move out.

Speaker 3: (09:01)
If I don't, then I'm gonna figure out what I'm going to do with that house. So I rolled into town on, I mean, I don't know, let's say it's, it's, uh, March for 13 rather than a town of malts. 14th and aU haul dragging my Volkswagen. And on March 15th we closed on a house. On March 16th we're working on the house. We had a crew working on the house. I mean, yeah, I mean, we, well the deal was, was I told Micah, you know, I was like, I said, I said, can you find a house? What can you find? He said, all I can find a house. And he finds one within like a week, get it in contract, come in, you know, we get it bought and start working on it. And we're just kind of, we're just kind of running long buying and selling houses, you know, buying houses, flipping them, selling them.

Speaker 3: (09:50)
And we come across one of the licensed vacation rentals here in Napa. And it's, it's, it's funny that you have, um, property in Tucson because this woman lived in Tucson and she was running this property here. It was run down, all the neighbors hated it and it needed work. And I called her on the phone and you know, the listing was getting ready to expire and I managed to get it bought direct. So we bought it direct from her and the play we had, I mean the play we had on this thing is kind of unique because we had, we had no intention of ending up in the, in the short term rental space in the Airbnb space at all. This was going to be a really, really high dollar flip. We are gonna, we're gonna, uh, we're gonna flip it, get it earn and money and then send it down the road and we're gonna, you know, we're like, yeah, we're going to make five or 600 grand in this thing, which had been great for us at the time.

Speaker 3: (10:52)
Um, and mind you, we are, we are in probably I think July or August of 2016 so we're only about 14 months into the end of the whole flipping endeavor. I mean, we were not in it long when we stumbled across this thing and bought it, ran it for a little bit, ran into the end of the year to try to kind of get our feet wet. And then at the end of the year we took it down, took it offline, and did a major renovation to it. I mean, we were moving walls and doing a lot of structural stuff to it and I think we took it down on January six and we wanted to be back up and running in the first part of April. And I, I remember walking in one day and taking a spray paint, cannon writing spray, painting a date on the wall. And the guys were like, what's that?

Speaker 3: (11:39)
I said, that's the day this thing will be up and running. So we've got to get this house done. And the deeper we got into that house, the more problems where we found, Oh Jesus, I don't know if we're going to get this done or not. And one day I walked in like just tear all the sheet rock out of this house. I was like, I have to know what's in this house. I, you know, we have to know. And at the time we had Mike's father on payroll as a consultant. My ex father has this very, very extensive background in construction and he was actually flipping houses when I moved to town and we just kind of assumed his crew because he didn't want to do it anymore. And we brought him on as a consultant to help us with, um, co with code stuff, with, with, uh, permit everything that we would ever need help with. And um, you know, Mike senior would, would, you know, if I had any questions, he'd be in the, he'd be in the project with me and he'd be helped him along and, and, and he was a godsend. Ah, one day I just like, just take all the sheet rock out of this house. And your, what's behind these walls because it's not been good so far.

Speaker 3: (12:49)
And we put, we put about a quarter million dollars into that house. Oh my gosh. Yep. Got it done. Um, it's a, it's a, it's a beautiful house. You know, if people go back into my, uh, in my personal and in my personal profile back and I think, and probably first part of 17, they can see it and we'll, we'll put links to all that in the show notes. People are more than welcome to hit me up on social media, on my profile, on my page. I don't mind. But the house was just stunningly beautiful when it came out. I mean, I loved the house in Napa. Yes. And in Napa it was a licensed unit, which there's, you know, around 50 licensed units. They're not issuing new licenses. So it was a rarity. Wow. And we were running like striking gold, striking a gold mine. It's like finding a mind, having to dig a little, but then, yeah, exactly. And then, and then, and then hit. And that hit in that one big [inaudible].

Speaker 3: (13:51)
So we, we really had, we had no clue what we had. I mean we were just running the deal and it was, it was bringing money in the company and then we're, we're still working flip projects. I think we had two others going at the time and we, we really had no concept of how much money this thing was making cause there was money and money out and I wasn't really watching the books that hard back then. And um, we put it in the market. I think we put it out at like one, three, nine, five and almost instantly the woman we, uh, listed it with when in the contract on it with her, with her business partner and what will shit it's going to sell. We're going to make a truck load of money on this thing. And then her business partner had a heart attack or a stroke or something and she had a bat, she had a backup on it.

Speaker 3: (14:43)
Oh man. We're like, Oh fuck. Okay, this isn't going to be good. So then he goes back out and it goes back out. And I think a couple from London come in and they buy it or they go into contract, I think 1.295 and then they get it appraised and just the real estate, just the house appraised at 1.1 million that's not taken, that's not even taken into account. The bump for having a license and the business attached to it. So they come, they come back like, yeah, you know, we think we want to move to 1.1 like now, fuck that we're done. We kicked it. So we just, you know, let it earn, let it earn, let it earn. And we were, uh, we were still flipping houses. We did one round the corner where we had to Jack it up, put new foundation under it.

Speaker 3: (15:37)
And this was kind of coming into the end of 2017. There were a lot of changes going on in the city of Napa, in the building department. And we're like, you know what? We're going to kind of back out of doing houses for a little bit because this was becoming too difficult. And in doing that, more of my focus was in the office. I was paying more attention to what was coming in. I said to Mike one day, I'm like, this house is making a pile of dough. Say I don't think we need to do this again. We don't even need to be thinking about selling this thing. I was like, this is, this is making a lot of money. Well we'd come across another property and bought it at and got it online as a vacation rental and it was bringing in money. So the time we're running two and um, and the 17 were completely backed out of, out of um, uh, doing regular heavy lifting flips. Cause you know, we did some really, really heavy lifting stuff. Like we'd tear down a house around a toilet and rebuild it. It was, it was like reading on some of these things. It was like rebuilding an engine through the muffler. It, it was, it was simple. That's crazy. Um,

Speaker 4: (16:49)
and California has some of the deepest stipulations with, um, with their codes and regulations and the guys who come in. I've got a friend in LA and he was actually, he's got a whole program about how to beat the inspector. He calls it because it's crazy. There are rules and laws and regulations and how they just come up with new stuff. So like you said, it gets trough, it's not an easy thing.

Speaker 3: (17:13)
It gets really, really tough. So, um, we're running two and um, we just kind of laid back for like the last quarter of 17. I had ran home to sell a house I had back there and we were pivoting into wholesaling. So in the pivot and the wholesaling and then we had these two vacation rentals going in there. I mean, they're just barfing up dough and that's when we kind of realized like, okay, there is possibility here, there, I mean this, this can work here. And one of the reasons I can work here is we're in Napa Valley. I mean it's, everything here is regulated. You know, it's, you're not gonna have a whole bunch of people coming in unless they're running illegal units. Where at any place that you have short term rental regulation, you're going to have a bunch of illegal units. It's just, it's going to happen, you know, I mean it's, you know, it's kinda like when I was in the repossession and telling space, you can be running on, you can be running an honest business and you're going to have a bunch of people who are not, it's just, it's part of the space, you know, we accept it.

Speaker 3: (18:21)
So, um, we got into wholesaling, we are running that pretty good and Hoffman along and then we come across a property down in Vallejo, California that, um, was in, it was in a small HOA and overlook the Napa river and it looked out on a mare Island and their Island is what you used to be the or it was the first West coast Naval base. I decommissioned, I think 96 it was Clinton decommissioned at, so I think it was a 96 so that, that timeframe kind of makes sense. Um, but it's kind of an up and coming area South of Napa. I mean it's, they say it's the first affordable housing outside of, outside of the city. And we had talked about, um, looking for a place down there and, and I, I drove around down there and I was like, you know, this would be a really, really nice place to have one, but it's an HLA.

Speaker 3: (19:19)
And I was just driving around, you know, writing down addresses. We're going to start calling people and just kind of make that part of our wholesale, our wholesale a deal. We're just gonna just gonna do the same kind of calling that we're doing on that and just call for, um, uh, these houses. So I drove by his like, that's a really, really nice HOA, but it's an HOA. Well, lo and behold, within like 10 days, one of the houses in that HOA comes up and I walk into my, I said, Hey, this thing's in an HOA. Let's go look at it. One down looked at it. And, um, I was very, very diligent in the purchase that house. I wanted to see everything from the HOX. I wanted to know from the outset, are we going to get burned later on than have to get rid of the house.

Speaker 3: (20:05)
I mean it's, I, I try to be a really, really proactive soul. I come from an insurance background, you know, I owned that silly repossession agency and it's just like, you know, those are two businesses. A lot of shit can go wrong and you see a lot of shit no wrong. Yeah. This, I didn't want to buy a house and we had to remarket it later on. So I read all the HLA docs and there was nothing in there about running a short term rental. It's like, let's buy it, bought it, got it. Run in. Um, had a few, uh, had a few issues early on. We had a few parties early on down there. It's in Vallejo, it's the same city where other houses we have where we just got this big claim paid on. And um, you know, it's a, it was a learning experience for us because the stuff we have in Napa, it's a different demographic.

Speaker 3: (21:02)
So we didn't really experience people wanting to have parties and people smoking a bunch of dope in the house and sometimes the parties get out of hand and uh, you know, having to go, you know, put noise where sensors in the house. So that one that went through us, a couple of loops, we got through it really easy. Um, the HOA president sent me a couple of threat. Nene emails was going to shut us down. I'm like, Hey dude, it's like there's nothing in the rules and regs that you can shut us down. So just tell me what's going on. You know, all the neighbors have my contact information. Nobody's calling me if nobody calls me, I can't do anything about it. And we had some communication with a couple of the neighbors and we completely turn that thing around within like, I don't know, 30 days, no issues at all. And uh, run long, run long run long. Mike and his wife by one jointly, another one, the licensed units up here in Napa. So we started managing that one for them. And then one of our flip houses that we did down in Vallejo,

Speaker 5: (22:14)

Speaker 3: (22:16)
we decided just to make it an Airbnb, you know, it didn't sell the number we wanted to sell it. So like, you know, this thing doesn't sell at this number, let's just make it an Airbnb. Let's make it a short term rental. Let's, let's see what happens. And Mike got it up and running. Mike's really, really good about getting these houses online and get them up and run in and getting them Earnin and before long a thing was booking its ass off, I mean he was,

Speaker 4: (22:40)
but when you buy those, when you buy those properties, did you know the demographics of the guests you might be getting then? Or were you just thinking about flipping?

Speaker 3: (22:51)
Which house? Which house you talking about the, the last one or the, the one on the, the one on the riverfront. The one on the riverfront, the one on the river front. We bought with the intention of it being a short term rental that was bought for that intention because the beautiful thing about that house was that house was completely re floored, painted everything. All we had to do with that house was furnishing furnish shit and into this cute little HOA. The HOA does all, all of the lawn service from the Gates. So essentially from the garage line towards the street, everything behind that we take care of and the the, we bought the house from the old HOA president and it was, and still is, it's the nicest house in the development. I mean he had landscaped really nice, had nice nice plants and everything in it.

Speaker 3: (23:39)
And all we had to do was all we had to do is sprinkle it all we had to do with sprinkle it and keep the plants alive and trim omen. I mean it's a beautiful little property. We did one thing that property, which is we do it to every property we have, we put a hot tub in. So we had to run a 50 amp service from the box back there. Get a hot tub, get it installed. And that was it. That's all we had to do. Which, I mean it was easy. That's, that's the easiest house to bring online we ever had. Fantastic. And tastic so that brings you up to three managing four, correct? Yes. Yep. And then, and then the flip house was number five. Okay. And then, and then the flip houses where, uh, that one started booking up really, really good.

Speaker 3: (24:31)
Due to we want to, do we want to talk about this claim? Yeah, we're definitely going to get into the claim. I've been, I've been getting, I've been getting a lot of action on, on that, on that video for that claim and I why Airbnb paid you so fast. Well, okay, so let's, let's get into the claim then. We'll talk about why, why Airbnb paid us so fast. Um, so we get a booking, it's a, I think a three day booking. Now mind you, I don't know a whole lot of particulars on this, um, because I don't handle that side of things. Mike and Becca handle that side of things, but it was a two or three day booking and we are super hosts and we're on instant book and we operate at scale. We don't go and get into everybody's social media and then get on and then get on these, on these Facebook groups and start saying, Hey, you know, this guy's got a cat picture as his profile picture.

Speaker 3: (25:29)
You think he's going to bring his cat with him and all the crazy shit that goes on in those things. You know, we, we operate like a hotel. I mean it's, we operate at scale. So if they book they book and you know, we've always had good experience with having these properties, you know, in Napa Valley and we got the other one inL under control and we operated like most people do under the auspices that Airbnb has us under control. So Airbnb has the guest's under control. You know, we never imagined we would experience what happened to us with this claim by these guests. So, uh, these guests book the property for a couple of days, I don't know, two or three days. And then they want to, they want to extend the, the stay and they book, they, they checkout and our cleaning crew goes down there and they're like, the TV is missing from the wall.

Speaker 3: (26:28)
We're like, what? And they send a picture, I mean the whole fucking TVs and ripped off the wall mountain, everything. There's holes in the wall and we're like, Oh fuck, what else is missing? And then they walk around like the washer and dryer are gone. Now mind you, this house has been online for like maybe 60 days. So everything in this house is brand new and we're like, Oh Jesus. So hell did they get a washer and dryer out? Well, so it's a California deal. The washer and dryer were in the garage and this is a two story house and they took everything down the stairwell. So it was out of the view of the cameras that are on the sidelines of the house. At that point in time, we didn't have a camera on the front of the house. We didn't have a ring camera on the front of the house. So they knew where they could get the shit out. So the washer and dryer in the garage, typical goofy California thing and they took everything out to the stairwell. So we're like, okay, the TV's missing, the washer and dryer are missing. You know what else was gone? And I go down there,

Speaker 5: (27:38)

Speaker 3: (27:39)
our manager goes down there, our admin goes down there and we're down there like, okay, we get, we've got to get this figured out. There was some damage to the house we had to get fixed. And lo and behold, a couple hours later, our admins like the microwave is gone, the coffee maker is gone and the toaster are gone too. I'm like, okay, we got to get into this and figure out what in the hell is missing. Now mind you, we're walking around this house and somebody meth pipe slash crack pipe is on the counter. There is a book there with what appears to be a bunch of stolen bank account numbers and credit card numbers. Oh man. Oh yeah. I mean, this is a big full on. This is a big full on, uh, uh, uh, deal here. Oh my God, the bedrooms appear to be slept in, but there's paraphernalia in the one master bedroom there. Shit going on down in the other master bed room. When I was watching the camera, a gal was coming in and out with different wigs and um, in their booklet there was like this checklist of, you know, buy wigs,

Speaker 5: (28:52)

Speaker 3: (28:53)
buy gift cards. It's like this checklist of nefarious shit they were going to be up to. I mean, thank God there wasn't any like, let's steal all this guy's shit while we're at it too. Oh my God. Yeah. So credit card they used to get the Airbnb was probably a, well, what was, what I found really, really peculiar was they came into, when I started watching the cameras after the event, they came into the end of the house with a brand new printer in the box and left the box behind, took the printer. So in kind of scouring the house after the police left because they didn't really give a shit about anything. We found the needles and then we found a printed altered,

Speaker 5: (29:37)

Speaker 3: (29:38)
paper, temporary license plate for some other state. And it w then we started finding receipts from like over in Lafayette where they're buying gift cards and all of this, all of this weirdness, you know, and I get it. Airbnb cannot, Airbnb isn't going to run a criminal world. I am.

Speaker 4: (29:58)
Exactly. They're not a police. Yeah. Yeah,

Speaker 3: (30:01)
exactly. There's, there's, there's only, there's only so much this stuff that you're going to prevent, you know. Um, Chesky actually said it really, really good in a, uh, interview I saw him on, he said, you can, you can only prevent so much bad behavior. And he 100% right. I mean,

Speaker 4: (30:22)
looking at Hilton or somebody like that, they, there's no way they can tell who's coming in. They can't do a background check on every single guest,

Speaker 3: (30:31)
every, every, it's going to be a crap shoot with every gas. And you know, when I posted the first video, people like, well, why the hell did you even take them? And the reason why they're saying that was we found out after the fact, they had three previous reviews with drug usage and damage and theft mentioned. Wow. And people are like, well why the hell didn't, why the hell did you take the reservation? I don't know the total mechanics of how that works. Cause like I said, I don't handle it. Somebody else's LinkedIn posts. You bumped them. Yep. We are a super host and we are instant book and we do not go getting mired down in profiling every one and getting in there, getting in there their social media and everything. Cause I, as I said before, we operate at scale. We are, we are not Dick and Jane, Susie or Dick and Jane, uh, uh,

Speaker 4: (31:25)
Oh mama. You don't have a mom and pop one thing where your, those are the only reservations coming into you so you can check. Yeah,

Speaker 3: (31:32)
yeah, yeah. And for that, I don't get mired down and, and, and watching a camera, I mean this is the only house we even have cameras on. You know, I don't get down

Speaker 4: (31:42)
businesses that you're running to Chris, like most people, if that's all they do, great. You've got the time to make them cookies and greet them at the door. We don't. Yeah. Yeah,

Speaker 3: (31:54)
exactly. And I mean, and for all intents and purposes, every one of these houses is its own mini business, you know, so, so we have that going and we have other real estate endeavors going at the same time. So long story short, you know, we get a full accounting of what's missing and it's like, it's $6,000, it's $6,000 of missing stuff and damage and you know, it's, it's in a previous video, feel free to go back and, and, and my stuff and my, all my stuff's open. You can see I've got actually got a video of the listing of stuff and it's crazy. Um, I mean down to stealing their coffee and the, the, the tide pods and stuff. I mean, they did, they, they took everything. Um, so we have the $6,000 claim, we submit it and it's, you know, it's some pushback, well, you know, we need to know the replacement costs versus a purchase cost.

Speaker 3: (32:47)
And, and you know, I'm a realist. I understand that Airbnb is going to vet every claim. It is in their best interest because there's people who are going to try to defraud Airbnb. Right. You know, I'm not one of these souls that sits back and be like, you know, I want my fucking money right now. I, you know, they need to cut me a check right now. And we're also not, the organizations can be like, we've got tens of towels missing. You know, we want to be, it's like that is kind of part of the shit you get into. You're in the hospitality business. People are gonna steal the fucking towel. So it's going to happen. Yeah. So, you know, but we also don't expect people to take all of the small appliances out of the place. So we submit this claim, they're dragging their feet or, you know, I mean normal people would say, Hey, they're dragging their feet.

Speaker 3: (33:36)
They're not going to pay us. We had to get a police report from the city of Lao. It takes 10 business days to get that. So, um, we were into that and this Arenda thing happens. And unbeknownst to us, and we'll go into this to the night of the Orenda shooting. We had another event in this house that we didn't even really know about until a couple of days later or actually we knew about it. We knew of bought it on on November one. So wait, wait, we're dealing with this, this, um, the 6,000 hour claim with, with Airbnb and we send them everything they need and we're sending them documentation upon documentation on documentation and um, Orinda happens. And uh, I think the only reason that got paid was Orenda was a guest centric guests behaving badly event that went bat shit crazy on them really bad. You know, air B and B got punched in the face with that vice article, which was, uh, which was a host centric problem.

Speaker 3: (34:42)
And at night they got punched in the face with the Arendelle shooting. And I, my interpretation is it was all hands on deck and Airbnb and it was purely about, you know, public relations or relationships or emotion relations with their guests. And it was all about damage control. Yup. And I think the only reason that thing got paid as quick as it got paid was they're like, okay, let's go. You know, let's, let's look at shit a little harder. And they looked at the claim, they looked at what happened and they looked at the previous guest reviews. And like, here, this is something that we should have caught because by their, you know, upcoming guidelines and they're gonna verify hosts and verified guests. And if they would have been doing this previously, which I think every one on the host side and guest side will agree this is something they should have been doing previously. I mean they were told

Speaker 4: (35:42)
there should have been key words that they could have picked out from any of those reviews.

Speaker 3: (35:47)
Well, and if you look at this, this new high, these new high risk reservation parameters, that should have triggered it too. And that's something that they should have been doing beforehand. But they are operating like your typical Bay area tech company operating very, very reactively. You know, I don't know how they run, but you know, my speculation is it's not in a really, really proactive manner when it comes to this and Chesky has said, you know, we've handled things poorly in the past and we handled this poorly in the past. So I think the only reason that that claim got paid in an expeditious fashion was because it was a bad behaving guest. There were numerous, there were numerous previous reviews of bad behavior and they did something so outlandish like taking the washer and dryer, taking the television. I mean the, I think the only thing I would've made it better is if they took the, the, the refrigerator and the dishwasher and I think the only thing that kept them from doing that was they couldn't get it out of the house easily if it would've been a ranch house instead of a two story.

Speaker 3: (36:46)
And this is one of those knucklehead California houses where it's a two story house. The garage is in the, in the bottom there is a master suite next to it. Then the whole living deals upstairs. So if it had been a ranch house I I,

Speaker 4: (37:00)
Oh heck yeah. It would have been easier for them to just pop it out the door going downstairs not so easy.

Speaker 3: (37:06)
Yup. And I think the, I think the refrigerator, the refrigerator and the dishwasher would have, would have left as well, so and so it was kind of like the perfect storm of you have this guest center guests you following Orenda and then the, the guests behavior was so outlandish and what they did to like, I mean Jesus, I mean we've got to pay this. I mean if we don't pay it this and this would for some reason go viral or bring attention. We're going to look really, really bad for not paying this. So I think there's like, screw it. We're going to pay it.

Speaker 4: (37:42)
Yup. Oh my God. It's so crazy. Just think about though. But like you said here, this one, you have operations and you have several units. This is going to happen. It's, it's just a matter of when you aren't going to get ripped off. Just, I mean I love the way you handled it. When I was watching the video and I'm watching you laugh and I'm watching you talk about, um, the girl who works for you, I guess, and how she was getting really angry and she was taking it so super personal and not personal man,

Speaker 3: (38:13)
no bag. You know, Beck Beck is a young girl. She's like, I think she's 22 or 23. And she, she took it as a personal affront because Becca put that house together, you'll get the furniture, everything. And she really, really took it personally. And I mean, you know, spend all years the repossession business. I mean, I'm to the point in my life where I just don't anything seriously. I don't give a shit.

Speaker 4: (38:36)
I mean, I'd say, well, you don't take it personally. There's a big difference because you realize it wasn't, they weren't doing something against you, you know, um, they were being bad people doing bad things and you just happen to be, you know, the target, your business happened to be the target. So.

Speaker 3: (38:55)
Exactly. And there's, there's a lot of shit that you can prevent. I mean, could we have prevented this? Yeah, we may have been. We may have been able to prevent it by camera's. You had your noise. We had the cameras, we, we, we trusted Airbnb and what they are doing. And I mean, you know, you know, maybe maybe we should live better by a trust but verify principle. But you know, it's, again, we operate at scale. If we want to operate at scale, there's certain things we can't do. And that's, and that's having a microscope on every house, looking at them, looking at them as they come in. And I'm not doing, you know, we are not gonna watch guests. You don't, we are not going to operate like, no, we're done. We're not gonna do that to folks. I don't want people doing it to me and we're not gonna do it to them.

Speaker 3: (39:39)
So the, the, the, in my, my opinion is the cameras exist. So we can, we can, we can verify what happened after the fact that there's, if there's a problem and, and we've never had a big problem. We've had, you know, these houses in Napa Valley, Napa Valley is, it's no mystery. It's a giant bachelorette party destination and one of our houses is really, really big. It's got a pool and a hot tub and these gals get to drink in a little bit and they end up downtown in the bars and one of the bridesmaids meets mr right now. And they end up back in the bathroom and the fucking towel bar ends up pulled off the wall. You can imagine what's going on in the bathroom, you know? And, but you know, it's, it's stuff that we have experience, that little stuff we've experienced. It's like, okay, we're, we're kind of in the destination for that and we just fix this shit. I mean, we'll charge the guests, we'll say, Hey, it's, you know, it's gonna cost 75 bucks. Yeah. It's gonna cost 75 bucks to fix it. And then we bill important they pay, you know, so we're, we were kind of a knockoff collated to all of the silly nonsense, uh, hospitality space stuff. Yeah. But I mean, nobody expects to have all the appliances stolen out of that.

Speaker 4: (40:57)
I service had appliances stolen on a rental. Properties aren't a longterm rental properties down in Tucson only because, like you said, they're outside in utility closets so you know when they're outside in garage areas. I guess most people don't realize when you're raised in the Midwest, like we were like, why is this even outside? This is safe. And then you'd go to Florida and you're like, it rains here. How can you guys have like, doesn't this stuff kit on the back porch know for you? So you know I it's, it's just,

Speaker 2: (41:35)
yeah, that is part of doing business that we should realize that this is part of our business. We're in the hospitality industry. It's not our job to police people or what they're doing inside our homes is not on any of our business. Once they close those doors, they're renting our space. We do obviously ask that they treat our properties with respect, but at the same time, like you said, you can't watch them. We're not babysitting or we're going to stop it right there. That's the end of the first part of our interview with Chris. I hope you join me next week for the second part of this interview. He's actually got some great stories to share with you and you are absolutely going to enjoy it. Please go to our website, short term rental and click on the link for this episode. You can either hit show above or scroll down and you'll see it right in the last six episodes.

Speaker 2: (42:32)
You'll see those there and you can click on there and find the link to this show, this episode, and inside there you'll find the entire storyline for the posts that Chris had done on his Facebook page that said, Hey, we got ripped off today and here's the first video and the second video of him doing the walkthrough and all the things that happen. Third video of the day after how he got that place cleaned up a really fast and replaced all those items super quickly. I was, I was very impressed and luckily it was an orphan nights so he didn't have somebody coming right in, so he didn't lose any revenue. But I think you're going to learn a lot. And he also talks a lot about insurance because Chris, his background is in insurance. His family sold insurance, and then later on he was in the towing industry. And so he knows about the safety and security. You need to have an LLC to protect your business inside a corporate shell, and not just that, but having the proper insurance behind you. And he also uses proper insurance and recommends proper insurance. So we're going to go into that in the next episode. We hope to see you next week again. Have a great day. God bless you so much. Thank you for listening. Go and grow. 


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