Why Gulf Shores, Alabama Is Booming for Short-Term Rental Investors | Vicki Brown Explains

Vicki Brown (00:00)
They buy it for themselves. if that’s what they’re, again, you have to ask them, what is your goal? What is it you want? that, ⁓ as I mentioned before, I’m actually in the middle of writing a book on this because this is a common thing. People get into the market for the first time and they’re not asking the basic questions. Why do I wanna do this? What is my goal? And based on your goal, you start working your way through everything.

So for me, in all the years of people buying vacation properties or second homes, they buy it for their entire family.

Dylan Silver (02:05)
Hey folks, welcome back to the show. Today we’re joined by Vicki Brown, owner of Beach Life Properties and a real estate professional with over 25 years of experience in development and sales. Based in Gulf Shores, Alabama, she specializes in short-term rental investments and is a licensed broker in six different states. She helps buyers identify high-performing vacation properties in one of the top coastal markets in the country, bringing decades of experience, local market knowledge, and a strong understanding of what actually works in the short-term rental space. Welcome to the show, Vicki.

Vicki Brown (02:35)
Good morning. Good morning. How are you?

Dylan Silver (02:37)
I’m doing well, good morning, good morning. Gulf Shores, Alabama, I mentioned to you in the green room, that’s an area that I personally have a lot of interest in.

Vicki Brown (02:39)
Yeah.

It is a fast growing place. You should see what they’re doing here. just crazy with airport now. We have a Legion that’s coming in direct nonstop. I could get there from where I’m sitting with you in five minutes. I’d be at the airport and it’s just. And well, they call it that it’s it’s international to us here in the South, so it goes. It goes in mostly the eastern states, but it is so easy if someone wants to invest to bring people to their property. Excuse me, because now it’s nonstop.

Dylan Silver (02:57)
It’s going to be an international airport.

Alright.

Vicki Brown (03:15)
really inexpensive, great safety record, which we’re all concerned about on flights, but that and the infrastructure is really growing here.

Dylan Silver (03:22)
That’s a great point about the accessibility for travelers. How are people currently

getting to Gulf Shores, Alabama?

Vicki Brown (03:29)
Most of them are driving or if they are flying, they’re beginning to fly into Gulf Shores directly because of the new flights. But they’ve been flying into Pensacola or Destin, which Destin is about two hour drive. So it makes so much more sense for people to come right here to Gulf Shores and they’re really trying to promote it here. So like I said, this is a top place for investing in real estate right now.

Dylan Silver (03:41)
Okay.

I mean, when I think about this area, I haven’t been there, but I’ve heard such great things from guests. And I think you can get all of the feel of being at a beach, as beautiful a beach as anywhere, but in a market which is slightly more cost effective than some other markets. So you’re not gonna spend an arm and a leg, you know, just for a margarita.

Vicki Brown (03:55)
Yeah.

Yeah, definitely. Well, you there are places if you want to spend money, you can come here and spend money. But the beaches are pristine. They clean them every day. The sand is white. When you walk on the sand, it squeaks. I mean, it’s white. It’s gorgeous. The water is crystal clear.

My sister-in-law is vacationing right now away and so she sends us her beach pictures. Oh wish you were here. I could walk down the street and give her the exact same picture. The clarity of the water, the color of the water. So you know they call this nickname the redneck Riviera. It’s beautiful. It really is.

Dylan Silver (04:46)
There’s a lot of competition. mean, when you think about if people were previously driving in from Florida, right? So there might have been previously stopping in Pensacola. They’re having to figure out, okay, well, where are we going to vacation at? Where’s our beach destination going to be? And so I can imagine previously and continuing to today, you know, the Gulf Shores, Alabama market felt like, okay, we might not be directly competing with some of these other markets, but there is some type of competition there.

Vicki Brown (06:03)
There is, there is, but our prices are, as you said, it’s more cost effective, not just to vacation here, but to purchase here. We have ⁓ a huge variety of properties. You can go down to Fort Morgan, which is in the unincorporated area of Gulf Shores. But they are restricting, you cannot build over three stories. It’s mostly single family. It’s like going back in time down there. That is the hot spot that is going right now, because there’s still room. You can buy a lot and build there.

We have restrictions, have the beach mouse, we have the turtles, ⁓ but that is a real hot spot right now. You can go the other direction, go by Floribama, which everyone knows about Floribama. You can go that direction, and it’s a little bit more congested. You’re right on the Florida-Alabama line. ⁓ But there’s also an area called Ono Island. We’re very expensive, beautiful. We’ve got the peninsula where a couple of well-known actors live. They bought their homes there. There’s a diversity. I personally…

My husband and have decided to be, if you’ll excuse the term, we call it slumlords. So we will get, we buy the least expensive one that needs help and it’s okay that we don’t get the rents that the beachfront do, but it stays rented. It makes sense. If you don’t mind having a place that may not be what you would stay in, but it’s something where families will be able to afford to come down here. For me, that’s the hot ticket is getting those.

Dylan Silver (07:27)
How long

have out of state investors been looking at Gulf Shores and is it now hotter than ever as far as out of state investor interest?

Vicki Brown (07:38)
Well, it goes in cycles like anything else, know, up and down. had three years ago, it was a hot market and everything I put on the market, I had multiple offers the same day. That was fun. was, was, was, it was crazy how much people wanted to be here. But I think that now that the city is bringing us better infrastructure, it’s becoming a better market for people to buy. It’s, it’s not, let me buy it and hopefully it will all work out. This is a destination more in the, in the know, in the market.

It’s in more in demand right now.

Dylan Silver (08:09)
Are there specific areas in Gulf shores that outperform others or that you’re particularly bullish on?

Vicki Brown (08:18)
Well, as I mentioned the Fort Morgan, but it depends on what you’re talking about outperform outperform on rental income outperform on ⁓ value coming up. I mean, that’s that’s kind of a broad term. So if you’re looking at something that will outperform on getting rentals, you want to be near near the main area. So there’s a place called the Hangout, which is the biggest place on engulfed shores for activity. A lot of vacations want to go there and have something for everybody. That will bring you more

Dylan Silver (08:25)
Good point.

Vicki Brown (08:47)
activity because it’s right there. People will walk to everything. If you’re looking for something you buy now and it should escalate and of course we don’t know. You know I’m not going to say I know this but Fort Morgan has always been the kind of sleepy area that people are noticing now. So again it depends on what you’re looking for outperform. I want to get a better ROI on my property so I’m doing like what I told you. I’m buying that’s in the beach area that checks all as I say check all those boxes they can walk to everything.

but I’m not gonna pay 450,000 for beachfront when I can pay half that and my ROI is the same. I, you know, I’m very, yeah, yeah. So I can buy multiples of those and it’s easier on me.

Dylan Silver (09:22)
Yeah, ⁓ cash flow.

What’s the biggest mistake that you see people making when buying their first short-term rental?

Vicki Brown (09:37)
They buy it for themselves. if that’s what they’re, again, you have to ask them, what is your goal? What is it you want? that, ⁓ as I mentioned before, I’m actually in the middle of writing a book on this because this is a common thing. People get into the market for the first time and they’re not asking the basic questions. Why do I wanna do this? What is my goal? And based on your goal, you start working your way through everything.

So for me, in all the years of people buying vacation properties or second homes, they buy it for their entire family.

And I have told them forever, okay, so how often do your children visit you? So you’re gonna spend so much more and you’re gonna have three extra bedrooms you’ll never use because you’re planning for that family vacation that happens once a year. Is that the right thing to do? Wouldn’t it make sense that they can rent a place next door to you? Or they can, know, we used to sleep on the floor.

No problem, know, grandma hands me a pillow and a blanket and I’m good. Even as adults, you know, I’ll sleep on the floor, it’s okay. But they buy property, yeah, it’s okay. Yeah, you just wanna be there. You wanna be with your family or if your adults rent something, buy them. But don’t buy a property that’s more than what you need. Now, you you might be talking yourself out of a big sale, but your customer’s gonna be happier that way. I truly believe that.

Dylan Silver (11:13)
Yeah, we’re happy to be there. Vacation spot.

How has the

short-term rental market changed over the past few years?

Vicki Brown (11:38)
the management has changed. We’ve gone through cycles of that as well. So it started out with, ⁓ you get it, you do it yourself, you can go VRBO, Airbnb, and we had a lot of small mama pop places here. The local people, know them, you know, and they put on Airbnb and take care of it, which is good because a lot of these people don’t live in the state. So you need that. Then it started to grow and we had these very large companies.

Dylan Silver (11:57)
Yeah.

Vicki Brown (12:05)
that I’m not saying they’re bad, I don’t want to mention them, but mean, very large companies would come in and they would do the best they could. They would just gobble up all these other ones, hoping that it would still be the same. But what you find out is you’ve got a corporation that needs, requires to maintain control, but then it’s not focusing on the little markets. So that is, it’s now coming back the other way. So now these larger companies are making changes.

they’re making their, if they’re gonna keep these, the areas, they’re focusing smaller or they’re selling franchises. But the small, I used to call it, small boutique management companies are what is going right now. So if you’re gonna buy one, use the one, sorry.

Dylan Silver (12:48)
I mean, when we talk about

that short-term rental space, it’s so critical to have like top-notch communication, right? I’m actually in an Airbnb right now in Santo Domingo, and I know that I’ve stayed in several, right? If you have any issue and you’re in a new place, it’s not something that you can necessarily wait for even a couple hours with because it could really throw a wrench in your plans.

Vicki Brown (13:14)
Yeah.

Absolutely. What if you have a water leak? Can’t get a hold of somebody. That’s terrible. I had one that they the visitors came and they used the washing machine. Well, the owners had just had it hooked up and they didn’t punch out. You know, there’s a punch out to the back for the drain in a washing machine. Didn’t do that. So all of sudden water is pouring everywhere. You know, we were right there. So it wasn’t bad. But imagine if that happened and you had a big, huge company that didn’t have local.

you know, good communication. You’ve got water going from your floor to the next floor, to the next floor, to the next floor, all this water damage and money. a local person that you have seen and you’ve talked to, to me, is very important.

Dylan Silver (13:56)
For someone who already owns one STR and they’re thinking about ⁓ potentially scaling their business, what’s the next step for them to scale? Is it hiring a dedicated ⁓ property manager? Is it them really delegating a lot of the work as far as management and cleaning and changeover?

Vicki Brown (14:18)
⁓ If they live in the area and they’re doing nothing else, you know, you should do it yourself. Don’t be lazy. You know, take care of own property. If you live out of the area, our very first rental, I lived in Missouri and we bought it down here. So we had to have someone. But what we had was a really good cleaner. Number one, got to have a good cleaner. If you have a good cleaner that will take pictures for you, you can deal with everything else. You can create a list of contractors.

So I would say the first step to go back, answer your question, the first step is what do you have? How much you wanna be involved? Have a good list of contractors, of people that you can talk to. Your cleaner is number one, because those are your eyes to your unit.

So I would start with that. If it’s just more than what you wanna deal with, get some names. Talk to other people in your unit. Who are they using? Find out what has worked for them, what is successful for them, and then look at the reviews.

on those units, see if they have any problems with it. But if you can do it yourself, don’t be lazy, do it yourself. Just have your resources.

Dylan Silver (15:59)
Yeah.

Do it yourself.

I want to pivot a bit here, ask you a question about the development space. I’ve heard from folks that it’s just trickier and trickier to find properties at a rate that pencils, that makes sense, and that flips are tougher and tougher. And so oftentimes people have to look into longer time horizons in order to ride that appreciation. But I’m also seeing a lot of people

all over the Sunbelt get into development of some capacity, whether that’s, you know, a single family infill lot or even building out a small subdivision. In the STR space specifically, are there people that are developing single family homes with the express purpose of creating a short-term rental?

Vicki Brown (16:53)
Yes, there are. Now, the first thing you need to check are regulations, obviously, because that’s a big thing, especially here in the beach area. They’re very environmentally sensitive on everything here. But yes, we have people that are developers are coming in with the full intention of having their program to be rental. ⁓ It’s difficult to find those infill lots at a decent price because you’re going to buy a lot here and there are open spaces.

lots that people use for parking. There are these spaces, but you’re going to be paying a couple million dollars if you want to put up town homes or you want to put up condos. You’ve got to really watch your dollars. It’s difficult to do it. You have to have deep pockets. But if you know you’re going to get the rents, and I think people are really banking on all this new infrastructure coming in, because I see a number of them right now going up right across from the beach.

There’s a street, there’s a beach side, sand side, the opposite side. So the opposite side of the roadway, I see two of them right now that are multiple units that are going up. And they’ll sell them and they’ll rent them.

Dylan Silver (17:59)
So bonus question here for you. I didn’t realize that there was a new construction happening right on the beach or very close to the beach. How much availability is there for those types of properties? If someone wanted to come in and get a new construction, you know, with an ocean view or close to the ocean view, is there a lot of those properties built?

Vicki Brown (18:20)
They’re still there, absolutely still there. I would look out in Fort Morgan for the most variety of lots because there are still beachfront lots out in Fort Morgan, second tier, third tier, fourth tier. There’s still a lot of them, a lot of them. And I would say they’re like 1.7 or so. I haven’t looked in a while to get a beachfront one. It’s gonna be long and skinny, but you know, they build up. So you can get three stories up is what you’re allowed out in Fort Morgan. Here in town,

Dylan Silver (18:47)
Wow.

Vicki Brown (18:49)
It’s just the restrictions are so tight. I if it was me and I had the endless funds to do it, I would build in Fort Morgan. Actually, I wouldn’t even look in town here. I’d build in Fort Morgan. But if you’re going to do rentals, build here, sell them, but market them as short-term rental and be prepared that you can show people what they will rent for. I think there’s so many agents that are selling these short-term rentals, they are not prepared. You have to have the full package. Get multiple

Dylan Silver (19:13)
Great plan.

Vicki Brown (19:19)
companies, vacation rental companies to give you numbers ahead of time before you even list the property and have that as part of your package. ⁓ So I know I’m kind of spinning around different stuff, but one thought you give me that makes my mind go to the next thing. So.

Dylan Silver (19:29)
No, I mean, that is

a great point. And I think it’s particularly true right now because as more and more people, particularly in the sunbelt, but really everywhere are realizing, you know, I could be working a job, but I could also be involved as a real estate investor. think agents can’t just say carte blanche, hey, I’m only going to work with

know, home buyers, I’m not going to work with investors or I’m only going to work with investors and I’m not going to. think you do have to be not 100 % a generalist, but you have to at least be able to speak the lingo a little bit.

Vicki Brown (20:06)
Yes, but if you long time ago I was I started I have just my real estate license and I had a good friend that was a broker and at the time I’m much older than you so at the time it was mostly men were in the business. She said once you get your broker’s license first get as fast as you can and when you go to look at this property you learn every single thing about that property that you can. You learn how it was constructed. You learn what the foundation is. You learn

⁓ what plumbing type of plumbing that they use you learn it all because you are you have to be better than anybody else on your knowledge and So many times we have agents that will list a property and just take pictures Talk to the owner find out the basics of square footage in that and then list it and that’s it That’s that’s not good service to your customers You need to know that property and if it’s an investment property You need to have be able to do some numbers and if you don’t know how to do that

Goodness gracious, know, go on YouTube. know, find something. There’s always something that will teach you how to figure this out. With AI the way it is, how could you not know this stuff? But you have to be prepared.

Dylan Silver (21:13)
What do you think about in a situation like that where you may have great rapport with the seller, you know, it could be someone in your sphere and they want to list with you. And if you’re working in a broker for a broker that has seasoned investor friendly agents, co-listing just so that you can get your feet wet and understand, hey, this is what the process looks like from the cradle to the grave, you know, working with someone who’s selling an investment property.

Vicki Brown (21:40)
That is a beautiful idea. That really is. Don’t be greedy. if you need to learn. So, so many times that they’ll just, you know, take it all and they don’t do well. ⁓ What I’ve always told all the agents I’ve ever worked with is that if you don’t know something, you say, don’t know. Do not make it up. Don’t, you know, BS someone through it. Say, I don’t know, but I will find out and I’ll get right back to you. And don’t take a chance with your reputation. You can’t get your reputation back.

So if you’re going to take on this client that is an investor and you haven’t done it before, the best thing you can do, what you suggested is wonderful because you are showing that you’re going to do the best job for your customer and it will come back to you. You will get referrals. Your business will grow better than faking your way through it and your reputation is ruined because you can’t get that back. Pardon me, excuse me. Yeah.

Dylan Silver (22:30)
Yeah, not worth it in the long run, right? We are

coming up on time here, Vicki. Any new projects that you’re working on and then as well, what’s the best way for folks to get in contact with you?

Vicki Brown (22:41)
Thank you. Well, right now, I’m sorry, sorry about that. ⁓ Right now, I am ⁓ starting to build my business back up. For so long, I’ve been supporting all the agents in property management. So what I’m working on right now is to do this less than perfect units, better ROI, and that’s the project I’m going through, all of them that are on the market. I’m doing all of the footwork ahead of time and

⁓ Working up a portfolio of the best properties on the beach right now, so it takes some time But when I get a phone call, I’ll have it all right in front of me. I I don’t want to depend on what I see on MLS So that’s my current project. I’m working on in addition to the book that I’m working on ⁓ And yes, thank you for asking how to find me I love new customers new clients and I will sit and answer questions Even if you don’t want to work with me if you’re thinking about doing your own thing and you already have your own broker. No problem

I’d answer any questions you like and you can reach me at BeachLife9898@Yahoo or ⁓ should I give them myself? You do that? Okay, I don’t know. 251-284-8661. But if you hit me or send me a note on Beach Life, B-E-A-C-H-L-I-F-E-9898 @ yahoo.com. I’ll get right back to you.

Dylan Silver (23:47)
Go ahead, go ahead.

Vicki, thank you so much for joining us today. Thanks for your time.