Has anyone had success selling a functioning AirBnB?

Question

Hi! Last year, my husband and I purchased an investment property in Salt Lake City that we turned into a short-term rental. Unfortunately, life took us away from SLC, and we're now living on the East Coast. We gave it some time running it from across the country, but are realizing that we'd rather not try to operate it from across the country. I was wondering if anyone had had any success selling a still operating STR and if so if they had any tips.

Shawn McCormick · Answer

@Aspen Lenzen

I live in Orlando, the 'capital' for STR's. I have helped dozens of people buy and sell functioning homes. I market them as basically a 'turn key small business'. In my market, that is a desirable attribute to have it already up and running. If it is performing well, the buyer pays fair market value for the home and enjoys the benefit of some future income with rentals you already have booked.

Although your reviews won't convey, the buyer can have some peace of mind that with future revenue that the first couple of months mortgage are covered while they make adjustments, build up some reviews and work out any nuances they need to. If you have a website, Instagram or other social page for the house, having those convey as well are always welcome.

Our market is heavily driven by STR near the theme parks, so not sure how the SLC market works, but to me, having it still operating is a must. Side note, The calendar can get tricky to work out inspections, appraisers and closing dates as the home may have guests. Your agents will have to work closely with you to make sure no guests are interupted but the buyer has access to the home and you close on a date with no guests that day and the following few days while they go in and take inventory, set up utilities etc.

Hope this helps, best of luck!

Katie Holmes · Answer

Hi Aspen! I'm an agent/investor in SLC. I think the best bet would be to surface it to all the local investor groups here. There's a really strong investor community which tends to be a great way to spread the word about existing Airbnbs coming for sale. The only thing I'll warn you is with SLC cracking down on short-term rentals, demand for the property could depend on how its zoned (e.g., does zoning allow for short-term rental use or would a future owner be at risk of it getting shut down by the city). If zoning is a challenge, it could still be a really attractive mid-term rental and there's some other creative things we could do to make it as attractive as possible to the investor population here. Would love to chat - feel free to reach out!

January Johnson · Answer

There's a STR Homes for Sale Facebook group, and I'm sure there are others.I sell STRs to investors on the Emerald Coast, so my advice to you is to locate the best real estate agent in SLC that ALSO invests in STRs themselves AND does a lot of business in this niche.  They will be your best asset.

Bill B. · Answer

Any STR buyer is going to want something that makes a good profit with a property manager. If the property makes a good profit with a property manager hire one and leave it to them. Even if it can do this, 90% of homes will sell for more to an owner occupant than an investor, maybe 99%.

Don’t forget. If somehow you can charge more for than an owner occupant would pay that would be over the appraised value. Meaning the buyer has to bring 25% downpayment PLUS any extra you can charge. I don’t see any chance for profit or decent return on a 30-40% downpayment STR where you pay over appraised value. They’d be better off buying across the street at market price and competing against you m

Marcus Johnson · Answer

Is the property sellable as a home for someone?   If so why not put it up for sale and get rid of it?  We bought a cabin on a lake that we thought we'd vacation at and run as an AirBNB.   After the running the business successfully for 2 years, I got tired of driving 57 miles each way almost every weekend.   Hiring a cleaner wasn't worth the cost it takes to run the business.  I sold the property to the first buyer in a week and made money off the transaction.  I learned a lot.

January Johnson · Answer

Appraisers give no value to the business aspect, so the property is sold at market value, even if furnished and even if there are future reservations on the books.  I work for an STR-only real estate agency, and we have agents in 20 STR-friendly markets who know this field inside-out.  A realtor who understands STRs and who owns them as well is your best bet in any market you're looking at.  Happy to discuss more offline.  Good luck to you!

Has anyone had success selling a functioning AirBnB?

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