This conversation with real estate broker, investor, designer, and short-term rental expert Stacey Duvall is packed with wisdom from over 30 years in the business. From her unconventional tenant screening process to why she’s transitioning from long-term to short-term rentals—and how she’s increasing cash flow 4X while staying strategic—this episode is a masterclass for investors at every level. If you’ve ever wondered how to manage Section 8 rentals with ease, scale into STRs, or design homes that rent for more, this one’s for you.
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Hello everyone and welcome back. I’m really glad that you joined me today. Thanks for being here.
Thank you so much for having me.
Today we are going to share so much wisdom from experience as an investor, as an agent. So make sure to tune in and stick tight because we’re going to learn so much from over 30 years of experience. That mixes roots as a real estate broker and an interior designer. And there’s a real passion for real estate investing for both self and helping others. So much has been done. I’d love to hear how it all started in real estate investing.
Started real estate investing, it actually started with a conversation that I had with a client of mine at least 22 years ago. He was an investor and he only invested in C and D areas of town. So I’m showing him houses one day and I’m in an area of town that I’d quite honestly never been to. And I’m walking through this house with them and…
Keep in mind, this is 22 years ago, the price of this house, the asking price was $19,000. It was in very poor condition and it was a two-bedroom shotgun. It had a camel back and it was unfinished. And so I asked him, what are your plans with this house? And he walked me through the entire process.
He was going to finish the upstairs camel back to make a third bedroom. And I don’t remember what the rents were at that time, but he was going to get an additional, let’s say $250 a month for that additional third bedroom. And his all-in budget divided by the rent, and my mind just exploded. I immediately understood everything he was describing to me, and especially the forced appreciation, which is really the backbone of my business and what I do with all of my long-term rentals, my short-term rentals, and my flips and rehabs. So that one client, that one conversation, that one house 22 years ago is what started this incredible thirst of how does this work? How do I do this? This is so exciting. I just want to know everything I can know. And so that’s where my journey began.
Wow. It’s always great to hear about that little tiny spark that started it all. I feel like that can motivate those of us who are trying to help others like you do, like I do, to see that one conversation that we could have with someone could totally transform their lives. Because that sounds like what this conversation did for you.
It certainly did. The next experience that I had that sparked it even hotter was a broker that I had a cross sale with probably 20 years ago. So not much after the conversation with my investor client. And he’s an amazing person, so I invited him out for lunch. I said, just want to get to know you better. You’re so amazing. And during the conversation, I asked him, where do you have most of your money parked?
Where do you invest your money? I want to learn from you. What do you do? And I was expecting him to say really sophisticated things like the stock market. He said, everything I own is real estate. I own laundromats, I own strip malls, I own duplexes. And for the first time, I really grasped the concept of diversifying your portfolio and not just single family. And that conversation again, really sparked this desire in me to learn this business. Just asking lots of questions of really smart people. That’s how I’ve done everything.
What I also heard on that is so often, in so many businesses, real estate agents, real estate investors, we see this in all these things. We can see others sometimes as competitors rather than colleagues, right? Especially if they are on the other side of a deal. And I love how you were like, no, we’re doing the same thing. Let me learn from you, right? That’s awesome.
The spirit of cooperation is really everything. It’s the core of everything that I do because I find that if you just ask questions of other people, they love to talk about what they’re good at. And so it’s a great way to build relationships with people. And that’s really how I got started in this business. And then 30 years ago, I started as an interior designer in a furniture company and it was so much fun and I really love interior design. But I got my real estate license about 26 years ago and showing houses to buyers for the last 26 years, I know exactly what buyers like, I know what they don’t like, and most importantly, I know what they will pay more money for. So I always keep that in mind when I buy houses to renovate, whether I’m keeping them as a rental in my portfolio or if I’m selling them as a flip property.
I always keep that in mind of buyers will pay more money for this house if I put in granite instead of laminate countertops. And so it’s one of the things that I do for all of my rental properties in my portfolio is that no matter what price point or what rent category that house is in, no matter what area of town, all of my kitchens get granite countertops because it’s indestructible.
It lasts forever. Well, and your point here, to go off on a little bit of a tangent, but I think it’s relevant for your expertise. Thinking of flips, let’s talk—or just selling investment properties in general, which I think investors do most with flips—let’s talk about staging. I’d love to hear your thoughts, your insights on staging when you’re selling your investment property.
I love this question so much because not only am I a broker, an investor, a flipper, but I’m also a designer. So I kind of wear many different hats in my companies, in my business. Staging is very, very effective, but I don’t really stage any of my properties other than basics—shower curtains, towels in the bathroom, maybe a couple of plants—but I don’t do any furniture staging. The reason I don’t do that is because my houses are beautiful and they’re completely renovated. So everything’s brand new. I don’t need to show a buyer how great this house is by placing furniture because it’s already a 10 out of 10.
Now what about those people who’ve maybe flipped a house and it isn’t a 10 out of 10? You know we’ve seen those as agents or as investors—you go in to buy a place and you’re like, oh, this is a little rough around the edges, right? To put it mildly. Do you think houses that aren’t a 10 out of 10 benefit from more robust staging or what are your thoughts on those situations?
I would advise: a beautiful sofa and great artwork is not going to hide sloppy craftsmanship or very, very inexpensive materials. Buyers are way smarter than that. And if buyers are going to buy in this market with the escalated interest rates and escalated prices, they are pickier than ever. So while the staging might make it look beautiful, if the flipper cuts too many corners, staging’s not gonna help.
That makes sense. Well, let’s go back to your journey and continue down the route. So you had these conversations, you had started real estate investing for yourself. What did your investing look like and how did it evolve over time?
I love this question. Like most investors, we started out with hard money loans and buying properties that were lesser expensive just so we could get in. So we have a lot of properties in the C and D areas of town that were a little more affordable to get into but have really higher cash flow because of Section 8. So we actually have quite a few Section 8 properties that we still own and manage. And that’s where most people start because it’s a little easier to get into more affordable homes. As we built our portfolio and no longer needed the hard money lenders, we now go through either commercial banks or just ready-funding loans for our financing. And we are in the very early stages of identifying which properties we want to do a 1031 with and reposition those assets into short-term rentals. So again, we want to diversify a little bit more.
Okay, well there’s a lot to dive into here. What I’d love to do first is—people stress out about the prospect of owning Section 8 rentals. Can you talk about the logistics of that? People worry about evictions, they worry about damage. What has your reality been owning Section 8 properties?
This question is so important because as with anything, you can believe whatever you want to believe. You have the choice to design your business the way that it fits your business profile. I have a very interesting and very rock-solid way of screening tenants. And all of my tenants, I am so grateful to say this—all of my tenants are amazing. They pay on time and they call me immediately if something’s leaking. Because I have a very good screening process and I train them really, really well. So my experience with Section 8 has been very pleasant. Now, let me say I don’t enjoy the process, I don’t enjoy the paperwork, and I don’t enjoy the inspection process. All of that is very challenging to learn and it changes all the time. But in terms of my tenants, I’ve only ever had two evictions. And when my Section 8 tenants move out—well, not even just my Section 8, all of them—when they move out, there’s a little bit of cleanup to do, but there’s no damage to my houses.
So I’m sure people are dying to know: what is so special about your screening process?
I don’t know that it’s special, but it just sort of designed itself over the course of all of these years because I had to go learn property management. As a real estate agent and broker, nobody teaches you how to do property management. And it’s one of the most important aspects of this business. The first thing I do is they have to fill out the application and upload all requested documents before they tour the property.
I show all of my own rentals. I don’t have anyone that does that for me because that is also by design. Once they fill out the application, upload their paycheck stubs, their Section 8 voucher documents, I do all the screening before I show them the property. That sounds really backwards to some people and I get a little bit of pushback from applicants who just keep messaging me, “I want to see this home Friday at noon.”
That’s not how this works. And I say to them, “I understand that it sounds strange to fill out the application before you even see the home. However, you’re welcome to look at all the professional photographs on the listing and you’re welcome to drive by the neighborhood and the house. That’s everything that you need to know. If you’re unable to follow these instructions, I completely understand and I wish you the best of luck on your search.”
The reason I do that is because I want to make sure that whoever I choose for that property understands that it’s my rules. If you want to live in my beautiful home with granite countertops and a brand new HVAC and a brand new roof and brand new windows, this is how my process works. And when I explain it to them, almost all of them fill out the application.
So that’s the first thing that I do in my business. After I schedule the tour and meet them at the property, I say to them, bring anybody you want to bring to walk through this house and make sure it’s the best house for you. Because I want to meet all the people that are close to you. Because I want to know who’s going to be hanging out at this house.
And then the last thing I do is I schedule a visit with them where they live now. I tell them this is the final step in the process because whatever their current house looks like, that’s what my house is going to look like in 60 days. And a lot of times I walk in and it smells like bleach and Pine-Sol and I’m fine with that. If they’re cleaning, I like them already. So I do things a little bit differently, I think. And it’s just, it’s been a really successful process.
It definitely gives people some ideas and some different ways to do it. One of my other questions with the Section 8 that people I think don’t consider is, what is your average length of tenancy for Section 8 tenants? Like I found in Chattanooga, Section 8 tenants tend to stay for a long time. They’re not moving as much as you might have in like an A-class rental where people are just saving up to buy a house. What do you find with those tenants? How long do they tend to stay at one of your rentals?
That’s a challenging question to answer because every family is different. But I do find that almost all of my tenants are consistent, stable, and they don’t like to move. And that’s actually one of my questions during the screening process—we like to do three-year leases. I understand three years might seem like a long time for you, but we’re really looking for someone who wants to really put down roots in this house and stay for a long time.
Then I go through our safety and maintenance procedures with them and explain: we’re going to schedule a yearly maintenance and safety walkthrough with you. We’re going to replace smoke detectors if needed, check handrails, look for roof leaks—make sure the house is good and safe for your family. So from the very beginning, before they even sign a lease, they get the feeling that we’re not normal property owners. We’re going to make sure this home is really safe and secure for you.
That helps them feel comfortable with signing a long lease with us. And of course we do yearly conversations when their first year is up, second year is up. I ask questions like, “The last time I was there, your stove looked like it was getting a little old. What if I replace your stove as an anniversary gift?” Or, “Would ceiling fans in your bedrooms help?” Or, “Should I replace some window blinds?” Doing those little extra things makes tenants feel valued—and there aren’t many property managers doing that.
To answer your question in a very long answer, most of my tenants are probably in year four to six in their lease.
And that’s definitely longer than average. Now, with the three-year leases, I have two follow-up questions. The first is: what’s your policy if people decide they want to move prior to the end of the lease? How do you handle that?
I have one of those right now. Some girls who are roommates decided they don’t want to be friends anymore. I rarely take roommates for that reason, but I took these girls because I thought they’d be okay. Well, they’re not. One already moved out. She’s still paying her share of the rent and being responsible.
So now I’m having conversations with them to figure out what’s best. It’s a case-by-case decision. I always refer back to my lease, but I also consider what’s reasonable. I had one tenant get a new job in Virginia—amazing tenants, always paid on time—and I let them out of the lease with no penalties. It’s all situational.
That’s nice when it’s a win like that. And my other question about your three-year leases: do you build in rent increases, or do they pay the same monthly rent all three years?
The rent increase is on page one of the lease and is done year by year. It includes the date and the new rent amount for each year—year two, year three.
Awesome. Do you have a typical percentage or range?
I knew that exact situation would occur—where rents stay too low for too long—so my lease states “up to 7% a year.” That gives me the flexibility to raise it anywhere between 1% and 7%, depending on what’s happening with the market, insurance, property taxes, and other costs. I don’t want to put financial strain on families, but I do need to keep up with rising costs.
That’s a good point. It’s nice that you build in increases but keep it flexible based on reality.
I could even use that as a motivator to get tenants to stay. If I sense they’re thinking of leaving, I’ll say, “Your rent is scheduled to go from $1,400 to $1,625 in three months. But what if we do this…”—and offer a small discount if they renew. It creates cooperation and keeps great tenants longer.
Great insights for long-term rental investors. Let’s shift to something I know you’re passionate about. You mentioned you’re converting more properties into short-term rentals. I’d love to hear what you’re doing with STRs right now.
We have four short-term rentals and two more we’re about to start construction on. We’re doing 1031s out of some lower-performing long-term rentals into STRs in a few different markets. We’re in three markets now and evaluating where to go next. Simultaneously, we’re reviewing our long-term rental portfolio to decide which properties to sell to fund the next STR purchase.
That’s a big shift! What’s motivating that?
It’s just so much fun—and it’s four times, if not more, profitable than a long-term rental. For example, I might have five long-term rentals cash flowing $500 each—$2,500/month total. If I sell those and use the equity to buy one STR, I could net $6,000 to $12,000 per month from that one property.
Now, it’s a lot more work. But the cash flow is tremendous. And there are tax benefits like cost segregation that work really well for STRs too.
I love that you’re balancing your net-worth-building portfolio with cash-flow-heavy properties. Now, I noticed you’re buying in new markets. Why expand to new areas instead of adding in the markets you’re already in?
Part of it is lifestyle—we’re looking at markets we want to vacation in, so we can go stay at our STR, do our material participation, and enjoy the area. The other part is diversification—we don’t want to be too concentrated in one market or asset class.
If someone’s struggling to find STRs where the numbers work, what’s your advice?
Great question. I get that all the time. My first answer: it depends on your goals. Are you chasing cash flow? Tax benefits? What’s your budget?
But in general, first check the local STR regulations. That’s non-negotiable.
Second, study the competition—design, pricing, amenities. If they’ve got pickleball courts and you don’t, price accordingly.
Third, don’t overlook the ugly properties. One of my best STRs was underperforming when we bought it. The design was bad, the repairs weren’t done, the listing photos were awful. But I saw the opportunity.
We redesigned it, improved the systems, and we’re now booked every weekend through September. Ugly properties can be goldmines.
That’s great. You were able to add value with better management and design. That can totally flip the numbers.
Absolutely. And their management was another issue. They had a co-host charging 20%. That’s a huge chunk. If you need it, fine. But because we self-manage, we keep that margin.
Now, let’s close with a few quickfire questions. First: what’s your go-to tool for managing operations?
I use a lot of tools depending on the property, but I’m a little old school. I print calendars and bullet point sheets for all my subs and tape them to the inside of the front window. Everyone—my plumber, framer, electrician—gets their sheet, and there’s one giant calendar with the photo shoot date in bright red.
I start with the end in mind. For example, photo shoot on July 1st. Everyone knows that’s the deadline. So if someone misses their scheduled date, I can say, “You were supposed to be here yesterday. Now you’re throwing off my schedule.”
It’s not fancy, but it’s super effective.
Love that system! What advice would you give to your younger self?
Don’t believe the limiting beliefs. “It’s too complicated.” “I don’t have enough money.” “I don’t know what I’m doing.” That kept me on the sidelines for years. But once I dove in and bought my first house, I realized how much I loved it. I just needed the confidence.
So I’d say: believe in yourself and just get started.
Love that. And finally—what’s a book that’s been transformational?
Cash Flow Quadrant by Robert Kiyosaki. That book was huge for me. It sparked the entrepreneur spirit. If you’ve got even an inkling of that inside you, this book will pull it out.
And the classics like Think and Grow Rich—those helped shape everything I do.
If someone wants to connect with you, what’s the best place?
They can find me anywhere—Facebook, my website, even my cell. I’m happy to talk with anyone about investing, design, renovations—it’s my favorite thing to talk about.
Awesome. Thank you so much! Now, if you’re reading this and loved the insights from today’s conversation, take a moment to subscribe, leave a review, and share this with another investor. Who needs to hear this? Send them the link—and I’ll see you again next week.