Airbnb in Annapolis?

[Rob Roy]

Hey all!

Looking to see if any investors on here have Annapolis, MD Airbnb listings... From all the numbers I've crunched, it would be really hard to cash flow on a long term rental in a SFH anywhere near downtown Annapolis (using VA loan or up to 5% conventional financing to purchase the property- not 20% down). And it only seems to makes sense once you go further out and look at townhouses in the mid 200Ks in Cape St. Claire/Arnold. However, I have a very strong feeling that Annapolis would be a great place to have a full time Airbnb rental, as three out of the four seasons there is always something going on and there never seem to be enough hotel rooms available. If that's the case, it would change the type of primary residence I'm looking to buy with the thought of making a 'separate Airbnb unit' in the house while I live there and then list it as a full time Airbnb place once I move on (as opposed to a standard lease/tenant). From what I can tell on airbnb.com, there are certainly quite a few listings and my initial gut tells me it would make sense. Just curious if anybody has some experience with Airbnb in this market.

Thanks!

[Ben Bannister]

100% agree with Andrew. It’s too risky to buy residential real estate with the sole intention of making it a short term rental. You need an exit strategy in case laws change.

[Joshua Mast]

I’ve done the same analysis as you and cash-flowing looks difficult. The big benefit is commissioning and homecoming week, where rental prices go crazy. I know lots of people that move out of their homes for the week to get the cash ($4000 for a simple SFH all the way up to $15k for a large waterfront home). I believe breaking even would be possible, and if that is one’s investment strategy, it may make sense. I, on the other hand, want a lot of cash flow to make the trouble worth it.

I know one person who does it, but it’s outside the historic district. It’s a small 3 bedroom SFH and I think they make a little bit of money from it; however, they self manage it and it is located beside their primary residence.

I have been interested in short-term rentals in the Annapolis area for some time. Let me know if you get some hard numbers on this!

[Kyle Tipton]

@Rob Roy did you ever move forward on this? I’m always worried moving into the BnB world with fear the rules and laws with it will change one day. Hope it worked out for you!

[Ryan Miller]

Did you find anything that worked in Annapolis?

[Andrew Hemminger]

Hi Rob,

AirBNB is an option but you have to be careful.  A safer bet is to buy something large enough that can survive as a long term rental if you are later forced to abandon or limit AirBNB use (e.g., small multi-family, or tons of bedrooms...something you can house hack).  The city of Annapolis just passed a new law that placed a fair number of restrictions on AirBNB, including limits on numbers of properties someone can own and operate as an AirBNB, requirements for higher annual fees and inspections, and requirements to pay higher taxes on your profits.  Bottom line, I would review the law in it's entirety and understand the nuances before diving in head first.  Also keep in mind that the legislation will likely change again in the future (for better or worse)...all the more reason why you should analyze the property as a 100% long-term rental (or a majority LTR with a small use on AIRBNB) and be comfortable with that outcome before purchasing.  

[Ben Bannister]

100% agree with Andrew. It’s too risky to buy residential real estate with the sole intention of making it a short term rental. You need an exit strategy in case laws change.

[Marylin OShea]

I know this is an old thread - I am just going to chime in to say I've had a really successful experience as host for the past two years and I am happy to help anyone who is considering it.

Yes, laws do change, with proper lobbying there is a way and, so far, so good. Not saying it's scalable without limits but two properties that are well-managed in Annapolis can pay huge dividends. I'd say x3 what market long-term rent would.

Message me and I'll even share numbers!

Full disclosure: I am an investor, real estate agent, Airbnb Superhost & Ambassador, VRBO premier host.

[Alex Talcott]

I'll be on the ground looking at Annapolis property in passing at the end of the month. I'll circle back if anything intriguing.

[Stuart Penman]

Quote from @Marylin OShea:

I know this is an old thread - I am just going to chime in to say I've had a really successful experience as host for the past two years and I am happy to help anyone who is considering it.

Yes, laws do change, with proper lobbying there is a way and, so far, so good. Not saying it's scalable without limits but two properties that are well-managed in Annapolis can pay huge dividends. I'd say x3 what market long-term rent would.

Message me and I'll even share numbers!

Full disclosure: I am an investor, real estate agent, Airbnb Superhost & Ambassador, VRBO premier host.

Hi Marylin - My wife and I are looking into an STR in Annapolis and on the hunt for a real estate agent and folks in the area familiar with how STRs do. This would be our second rental. Hoping to connect if you are still an agent and know the area.

[Rob Schou]

Don't just limit yourself to Annapolis! Southern Maryland waterfront homes are also doing well in the STR market, especially if you furnish them well and market them correctly.