This Investor Turned Vacation Homes Into $30M Business | Dan Pascone with Shawn Moore | Ep #18

Shawn Moore is the founder of Vodyssey and says he's been a full-time real estate investor for 25 years. Shortly after college, he says, he wholesaled a house, earned about 2/3 of his annual salary from the deal and decided a salaried job wasn't for him. He then worked in fix-and-flip, development and build projects before moving into second homes and vacation rentals. He bought his first vacation rental in 2006 and says it earned money even as its value fell during the downturn.

By his account, he got serious about short-term rentals around 2012–13, wrote a book on his process in 2017 and formed Vodyssey as short-term rentals boomed after 2020. He says the company has about 3,000 active investors, and that he's never owned more than 8 homes, usually 6–8, trading up after about 5 years based on return on equity. He also says the company has reached about $18 million a year in revenue and aims for $30 million. [VERIFY: guest figures about his own company]

Shawn's central point is that short-term rentals are assets you invest in, not second jobs. He says most properties have a "highest and best use," and that not every market or property works as a short-term rental because some markets are heavily regulated and others lack demand. In his words, "we're not in the property business" but in the experience and hospitality business, so buying a nice home and listing it online isn't enough anymore.

He disagrees with stories that the short-term rental market is over, saying instead that many people are playing a game whose rules they don't understand. He says he doesn't manage his own properties and instead pays a management company, and that his model asks investors to commit about 3–5 hours a week, versus roughly 15 hours a week if you manage the properties yourself. The pros and cons are real, and results vary widely by market, property and operator.

Shawn says most new investors focus on cash flow, which he considers the smallest part of the return over 5–10 years. His illustration uses a $500,000 property with 20% down ($100,000). These are his assumed figures, not predictions, and they leave out many costs.

• Cash flow: He assumes a 5% cash-on-cash return, or $5,000 a year. He says he mainly wants enough to cover big expenses like a new air conditioner.
• Mortgage paydown: Early on, he estimates about $5,000 a year as the loan balance is paid down by rental income.
• Appreciation: He cites a long-term U.S. average of about 5% and urges looking back 20 years or more. At 5%, a $500,000 property gains $25,000, which on $100,000 of equity is a 25% return because of leverage.
• Tax benefits: He says a cost segregation study and bonus depreciation can allow a write-off of roughly 25% of the purchase price ($125,000). At a 35% tax rate, he estimates that's about $40,000 in lower taxes.

Adding these up, Shawn arrives at a figure he describes as roughly 75% on the $100,000. He also lists a fifth benefit that isn't a financial return: personal use of the property, which he says costs money but upgrades your lifestyle. Dan added that business owners may find an additional tax angle in the so-called Augusta rule, which we'd cover separately and which depends on your specific facts. [VERIFY: guest tax claims, confirm with CPA]

Shawn says his typical client is in their late 40s or early 50s, earns at least $250,000 a year and worries that a 401(k) alone won't maintain their lifestyle in retirement. He describes the process as spinning a flywheel: early properties don't replace income, but if you reinvest the savings and tax benefits, he says many clients reach a point around their 4th or 5th property where they have the option to leave their job. He notes that property size should scale with income. [VERIFY: guest claim; results vary widely]

Dan connected this to Hybrid Retirement, a concept we use for stepping back from an all-consuming career while keeping meaningful, flexible work. In that context, a rental portfolio could be one way to supplement income, for some people and with the right fit. Shawn also said bonus depreciation was expected to return under legislation pending at the time of recording. Tax law changes, so confirm current rules with a CPA. [VERIFY: current law]

His advice on execution is to do heavy due diligence up front, choose a single proven blueprint and stay with it rather than jumping between approaches. He also warns that a lot of advice online is AI-generated or copied.

• Meal for the rest of your life: Steak and potatoes.
• Technology he can't live without: Automatic door openers for the stalls on his farm, so he doesn't have to get up for the cows and chickens.
• Favorite quote: "Be fearful when others are greedy and greedy when others are fearful," which he attributes to Warren Buffett.
• Favorite book: Winning by Tim Grover.
• Personal hack: A consistent daily routine. He says everyone should build their own.
• Bucket list item accomplished: An annual trip to Alaska with 10 friends, now in about its 20th year.
• Current milestone: Growing Vodyssey from about $18 million to $30 million a year.
• Advice to his younger self: Take the chance. You'll be bad at whatever you try first, so be proud to say "I'm glad I did" instead of "I wish I had."

• Return on equity isn't the same as profit: Shawn's math assumes 5% appreciation, a 35% tax rate and eligibility for the tax rules, and it leaves out property taxes, insurance, maintenance, vacancy, management fees, furnishing and selling costs. Depreciation deductions can also be partly recaptured when you sell. Details on rental income and deductions are in IRS Publication 527.

• Hiring a manager can affect the tax treatment: Shawn pays a management company. Whether a short-term rental owner qualifies for the favorable treatment depends on things like average guest stay and how involved the owner is, so a CPA who knows these rules should confirm before you buy.

• Time and liquidity are real costs: At 3–5 hours a week, that's 156–260 hours a year, and you can't sell a house quickly. Local rules can also change. Our post on heart vs. head when buying a vacation home or investment property covers the lifestyle-versus-investment tension.

This hypothetical is for illustration only. All figures are assumed, aren't projections or recommendations, and ignore cash flow, mortgage paydown, taxes and transaction costs.

Assume an executive with $600,000 in household income buys a $500,000 vacation property with $100,000 down and a loan for the other $400,000.

• If the property rises 5%: it gains $25,000, which is a 25% change on her $100,000 of equity.
• If the property falls 10%: it loses $50,000, which is a 50% change on her $100,000 of equity.
• What she still owes: The $400,000 loan doesn't shrink when the price falls.

The same leverage that magnifies gains magnifies losses. That's why we'd also check where the down payment comes from, what happens if the property sits vacant for several months and whether the rest of the plan holds up in the bad case. A CPA can address the tax side.

We use Life-Driven Planning, a 6-phase plan covering Cash Flow, Retirement & Hybrid Retirement, Risk, Expense & Goal, Tax and Legacy. A rental property touches nearly every phase: it affects your cash flow, your risk, what you want your lifestyle to look like and your tax picture. Our video on retiring gradually with a hybrid plan explains the Hybrid Retirement idea in more depth.

Life Driven Investing (LDI) builds a portfolio backward from your life using the Four Liquidity Bands: 0–2 years, 3–5 years, 6–10 years and 10+ years. Real estate is illiquid and belongs, if at all, in the 10+ year band, and a down payment shouldn't come from money you need in the next 0–2 years. For executives with RSUs, options or an ESPP, our Equity Compensation Playbook, a set of structured rules for those awards, helps plan how and when equity is sold to fund a purchase, since those sales can trigger taxes. Under our Quarterly Strategy Rhythm (ongoing plan updates, decision reviews and rebalancing), we revisit whether the property still fits. This episode is educational and isn't an endorsement of Vodyssey or any company, strategy or investment discussed.

This episode is for corporate executives and senior professionals in their 40s and 50s with $500k+ in household income and complex compensation who are curious about real estate as part of a Hybrid Retirement plan and want to understand the time, risk and tax questions before they buy.

If you're a high-earning executive weighing real estate against the rest of your plan, we'd be glad to talk it through. Book a free Wealth Strategy Call with us, and we'll look at your situation together.