Estimating Expenses Near Disney World

[Benjamin P Scribner]

I'm new to STR investing and could use a "gut check" on my estimated expenses. My plan is to purchase a townhouse or SFH in the Lake Buena Vista (LBV) area and rent it through AirBnB for positive cash flow most of the year. My Google search found "Kissimmee short-term rentals on Airbnb and Vrbo average 74% occupancy, $273 daily rate and $4229 in monthly revenue" -- AirDNA. That sounded great until I compiled monthly operating expenses at $3,797 per month! 

Market forces are driving a lot of the high operating expense. Current LBV real estate prices ($305K - $480K) are so high that more than 50% or more of the monthly expenses would go to paying the mortgage. I'm trying to keep all other expenses as low as possible to make this work, but I also want to be realistic. 

Do any of these numbers sound outlandish? 

$267/Month - Taxes (based on Osceola website)

$245/Month - Insurance (based on Zillow listing in Regal Oaks)

$145/Month - Cable/Internet (based moneysavingpro.com)

$117/Month - Repairs ($1/sq. ft. for Zillow listing in Regal Oaks)

$180/Month - Capital Expenditures (best guess)

$400/Month - Utilities (10% of anticipated monthly rent)

$475/Month - HOA (based on Zillow listing in Regal Oaks)

[Tyler Gibson]

Quote from @Benjamin P Scribner:

I'm new to STR investing and could use a "gut check" on my estimated expenses. My plan is to purchase a townhouse or SFH in the Lake Buena Vista (LBV) area and rent it through AirBnB for positive cash flow most of the year. My Google search found "Kissimmee short-term rentals on Airbnb and Vrbo average 74% occupancy, $273 daily rate and $4229 in monthly revenue" -- AirDNA. That sounded great until I compiled monthly operating expenses at $3,797 per month! 

Market forces are driving a lot of the high operating expense. Current LBV real estate prices ($305K - $480K) are so high that more than 50% or more of the monthly expenses would go to paying the mortgage. I'm trying to keep all other expenses as low as possible to make this work, but I also want to be realistic. 

Do any of these numbers sound outlandish? 

$267/Month - Taxes (based on Osceola website)

$245/Month - Insurance (based on Zillow listing in Regal Oaks)

$145/Month - Cable/Internet (based moneysavingpro.com)

$117/Month - Repairs ($1/sq. ft. for Zillow listing in Regal Oaks)

$180/Month - Capital Expenditures (best guess)

$400/Month - Utilities (10% of anticipated monthly rent)

$475/Month - HOA (based on Zillow listing in Regal Oaks)

One thing to look at is the specific community that you're targeting. Many of the ones that are designed for short-term rentals include things like cable and internet as part of your HOA dues. Me and my team specialize in working with this type of asset and you are not wrong in that prices are going up significantly as are the cost of operations. We've also seen the average nightly rate increasing as demanding increases and at this point we don't see any signs of slowing on the demand side for short-term rentals in the area.