Is buying a Vacation Rental a good investment?

[Steven C. Suarez]

Hi BPers! I'm looking to buy a condo in South Padre Island, TX. There are plenty for sale down there at what appears to be good prices. But that's part of my hang-up. Why would so many people be trying to get rid of there's at lower prices than purchased? I'd like to have one to use and rent out on Airbnb and make profit each year if possible. There's plenty of variables involved, the biggest one being my wife is about to have our 1st baby any day now! Condo details: approx 1,000sf, 2b2b 3rd floor walk up, fully furnished. Negotiated price 107,800. Has a pool, no ocean view though. Mortgage 900/month, HOA 267/month (pays for cable, internet, water, trash, exterior.) insurance 87/month, electricity est. 100/month. In all I'm looking at paying about 22k down, 1350/month. Oh and they just built a new roof and has new a/c. Breaking even each year would be ideal, but conservative estimates I'd probably be losing money on it each year. Now an old saying that has stuck with me from coach Bill Parcels on horse betting. Bet a little, to win a lot. Don't bet a lot to win a little. This keeps ringing in my head. So BPers, what do you think? We do love it down there. We're not rich by any means, so would this be a sound investment? Or a luxurious burden on our finances? Thx! Stevo from Hurst