Pro & Con of Renting my house out vs airbnb in Frisco Tx

[Dorian Moran]

Im interested in renting my house out or going with the Airbnb approach. Looking for advice on which strategy would work best.

[Bruce Lynn]

#1 I'm guessing Frisco and/or your HOA probably don't allow AirBnB type STR. So you would be violating the law. Do others do it or flirt the law....sure they do.....could you be in a world of hurt if you get caught...yes....think about the back taxes you didn't collect for hotel/motel occupancy tax, maybe fines from the city or HOA...plus if you're booked out 1-2 months all the reservations you have to cancel and all the bad reviews you will get....do that and you'll probably get banned from the STR from what I see/hear. Plus you do all those people a real disservice. Think about how you would feel if you have 2-3 weeks booked for medical treatments, or treatments for your kids and 3 days before your stay it gets cancelled....or you're taking your kids on family vacation to the new Universal and your stay gets cancelled...because the owner got busted by code enforcement. Have to think about if that is the way you want to do business.

LTR....Frisco has high demand, but rent vs price is usually horrible....maybe works if you've been there a very long time, but still you could often redeploy the money somewhere else for a better return.  I see $900,000 houses get $4500 in rent.  $500,000 houses get $2500 in Frisco.   Makes sense for some foreign investors who don't want to send that cash back to their country where they have high inflation or risk of confiscation, but for real local investors, that kind of rent doesn't work well for most people.

If you are a recent buyer, probably makes even less sense. Might be better to sell for example and buy a duplex with higher ROI in Sherman/Denison area for example....or smallest single families new build in Princeton or Greenville. $230-$250,000...and rent for $1800/month or so.