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Updated almost 3 years ago,

User Stats

136
Posts
48
Votes
Joe Tomko
  • Specialist
  • Easton, PA
48
Votes |
136
Posts

Buying an Air B&B in IRA: How do I determine where to buy?

Joe Tomko
  • Specialist
  • Easton, PA
Posted

I will soon be rolling over a 401(k) into my sdIRA and I want to use it to buy one or more Air B&Bs.  How do I decide where demand is highest (i.e. there are not enough units versus renters) and whether rents/occupancy will pay my mortgage and other expenses each month?  I do not need to invest near where I live.  Do I care about mountains (skiing, hiking, etc.), beach, lake, golf destination, national park area, city, or other?

If I decide mountain, should I look at Park City?  Breckenridge?  Vail?  Whiteface?  Other?

If beach, Gulf coast, Florida Keys, Atlantic Ocean, Hawaii, other?

SFH, duplex, condo, townhouse? How many bedrooms and baths (like 2-3 bedrooms for a small handful of guests versus a big place for family reunions, corporate retreats) should I look for?

How do I best diversify?  Multiple property types, multiple locations, multiple quality levels, or some other manner?

Will I need 20% down payment plus the costs of furnishing the home?  As it is an income producing property, can I get away with less than 20% down with a bank?

Presuming I put down 20% and let's say I have $150k.  Generally speaking, would I be better off buying  a $750k unit, two $375k units, or maybe a $250k unit and a $500k unit?  How much should I expect to front for furniture, bedding, kitchen tools/flatwear, artwork/tchotchkies/other home-y items?  Is laundry key?

Is there an Idiots Guide to Air B&B or Air B&B for Dummies or some other resource that can answer most of my questions?  I reached out directly to Air B&B and didn't hear back.

Thank you!

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